Gov. Perry’s Pet Jobs Program Suffers A Recession

Many projects receiving millions of dollars in taxpayer subsidies through Governor Rick Perry’s high-profile Texas Enterprise Fund (TEF) failed to meet their contractual job-creation targets as the recession took hold in 2008, according to a new analysis by Texans for Public Justice.

AUSTIN — Many projects receiving millions of dollars in taxpayer subsidies through Governor Rick Perry’s high-profile Texas Enterprise Fund (TEF) failed to meet their contractual job-creation targets as the recession took hold in 2008, according to a new analysis by Texans for Public Justice.

The new report analyzes 45 TEF projects in which several large corporations received a total of $363 million in taxpayer subsidies and filed job-related compliance reports with the Governor’s Office in early 2009. The report finds that a growing number of TEF recipients defaulted on their job-creation pledges in 2008, with even more defaults expected to be reported this month as the Governor’s Office receives compliance reports for 2009.

Key findings of TPJ’s analysis reveal:
 
*  The Governor’s Office has awarded $363 million to 45 TEF recipients to create or maintain 47,735 jobs. These projects claimed 31,319 jobs in compliance reports covering 2008.
 
*  Just 13 of the 45 job-related projects reviewed were performing well. Twelve deals were non-performing, with two of these canceled outright. Nine deals were troubled, casting doubt on their future job targets. The Governor’s Office signed amendments that weaken the jobs targets in eight development deals. And the jobs provisions in three other deals were fundamentally weak the day that they were signed.
 
*  As of October 2009 the Governor has penalized 11 TEF grantees for defaulting on their job creation commitments. These penalties, totaling $647,100, amount to just 1 percent of the $64.1 million in TEF funding that they received.
 
*  The Governor has imposed the “death penalty” on just two TEF projects (Hewlett-Packard and Maxim Integrated Products), despite the fact that many other TEF recipients have qualified for termination under the terms of their contracts.
 
*  In February 2009, Governor Perry declared that the TEF program had created 54,000 jobs since 2003. More than one-third of these jobs are job pledges that have yet to materialize.