Taxes and Incentives

Our tax rate is competitive with the surrounding counties and we believe does not serve as an impediment to any business.

Hondo has the following tax rate structure:

1. City Tax Rate $0.437 per $100
2. Independent School District Tax Rate $0.9384 per $100
3. County Tax Rate $0.58275 per $100
4. Hospital Special District Rate $0.0898 per $100

Hondo has a tax abatement program as part of the incentives offered to businesses that are seeking to locate in our city. Each request for any tax abatement is done on a case by case basis. Upon your formal commitment to initiate your operation in Hondo, the city will consider designating your site as an Enterprise Zone project and Freeport Zone. This will allow you to take advantage of certain property tax exemptions and to apply for funding for your project from the State of Texas.

The City of Hondo Economic Development Office (COHEDC) will coordinate all applications for incentives offered by the State of Texas, Medina County and the City of Hondo. COHEDC works closely with new business prospects to facilitate their move to Hondo by coordinating with the City Code Compliance Department to facilitate permitting for your business.

The City of Hondo offers incentives on a case-by-case basis to businesses interested in starting or relocating their operation(s) in the city or for business retention, redevelopment and expansion. The incentives are determined by the kind of operation that will be initiated or expanded, the number of full time jobs created within a specific timeframe, the annual wages paid at the $30,000 range or higher, and the anticipated economic impact on the community. We look forward to working with you. Please reach out to Scott Albert, City Manager via email or 830-426-3378.

• Real Estate and Infrastructure Investments
• Type B Economic Development Sales Tax
• Capital Investment Reimbursement Grants, Including Building Fees and Permits
• Debt Financing

Tax Increment Financing Act
Tax increment financing is a tool that local governments can use to publicly finance needed improvements to infrastructure and buildings within a designated area known as a reinvestment zone. The cost of improvements to the reinvestment zone is repaid by the future tax revenues of each taxing unit that levies taxes against the property. Each taxing unit can choose to dedicate all, a portion of, or none of the tax revenue gained as a result of improvements within the reinvestment zone. These zones are commonly referred to as either a tax increment financing (TIF) zone or a tax increment reinvestment zone (TIRZ).

Texas Local Government Code
This Local Government Code authorizes municipalities to offer incentives designed to promote economic development by offering loans and grants of city funds or services at little or no cost.

Tax Abatement
The City of Hondo will consider providing tax abatements to appropriate businesses in accordance with the procedures and criteria outlined in Ordinance 1213-12-19. All applications for tax abatement shall be considered on an individual basis. The city will consider providing tax abatement for real and/or personal property as outlined in Tax Abatement Guidelines and Criteria passed and approved by the City Council on September 25, 2017.

Texas Enterprise Fund
The Texas Enterprise Fund (TEF) is the largest "deal-closing" fund of its kind in the nation. The fund is a cash grant used as a financial incentive tool for projects that offer significant projected job creation and capital investment and where a single Texas site is competing with another viable out-of-state option. The city will work with any new venture to submit the TEF application to the State.

Enterprise Zone Program
This program is an economic development tool for local communities to partner with the State of Texas to promote job creation and significant private investment that will assist economically distressed areas of the state.

Skills Development Fund
The Skills Development Fund is Texas' premier job-training program providing local customized training opportunities for Texas businesses and workers to increase skill levels and wages of the Texas workforce.

Skills for Small Business
This program supports businesses with fewer than 100 employees, emphasizes training for new workers, and helps upgrade the skills of incumbent workers.

Foreign Trade Zone
In the United States, foreign trade zones (FTZs) are the domestic equivalents of international "free trade zones," intended to encourage healthy competition with foreign businesses. These zones directly help U.S. companies who either import products or components from foreign countries by reducing, deferring, or eliminating duties and by allowing for greater supply chain efficiency.

Eb-5 Visa Program
Texas Growth Fund provides immigrant investors with real estate investment opportunities that comply with the United States Citizenship and Immigration Service's EB-5 Visa Program.