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The recession and the Texas Enterprise Fund

A report worth reading from Texans for Public Justice:

The global recession that hit Texas in 2008 is playing havoc with Governor Perry’s signature business-incentive program: the Texas Enterprise Fund (TEF). A review of 45 TEF projects that received $363 million in public funds reveals that an increasing number of TEF recipients defaulted on their job commitments in 2008—with even more defaults expected to be reported in the 2009 compliance reports that TEF is now beginning to receive.

Run out of the Governor’s Office,1 TEF has been a centerpiece of Perry’s administration, with the governor often convening media events to unveil TEF awards. The political role of the program has become more problematic in the last year. As a brutal economic downturn coincides with Perry’s reelection campaign, the governor has not publicly addressed his job program’s mounting woes. Instead, his office has quietly redefined success. When the 2008 recession struck, the Governor’s Office increasingly amended TEF deals to ease the contractual requirements of what a recipient must do to hold onto its public funds. In its first four years of operation, TEF formally amended just one development deal.2 Since the recession struck in 2008, Governor Perry has signed amendments diluting six additional development contracts.3 While the governor, House speaker and lieutenant governor all approve TEF grants, the Governor’s Office said it acts alone when amending the deals.

The whole report is worth your time to read, as is this DMN story about the report and reactions to it.

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