Houston companies seeking property tax abatements could soon have to pay their workers more, cover health insurance, and steer clear of wage theft complaints under a package of amendments headed for a city council vote. Council Member Alejandra Salinas is pushing the changes, which would tie the city's existing tax relief program to new minimum wage floors, prevailing wages for construction workers, and stronger apprenticeship requirements.
Houston City Council is expected to vote on amendments to the city's property tax abatement rules as soon as this month, according to ABC13 Houston. Salinas's proposal would require higher minimum wage floors tied to city wages, prevailing wages and workers' compensation for construction workers, and health insurance benefits for project employees, per the same report. The plan would also prohibit contractors with documented records of substantial wage theft or OSHA violations from receiving the incentives, and would strengthen the city's apprenticeship utilization program.
The push comes as Houston works through a mandatory, once-every-two-years review of its tax abatement code. Under Chapter 312 of the Texas Tax Code, municipal property tax abatement guidelines automatically expire every two years and individual agreements are capped at a 10-year term, according to the City of Houston. To keep that authority alive while amendments were drafted, the council passed Ordinance 2026-0734 on August 26, temporarily readopting the existing rules ahead of their expiration.
Mayor's Office Signals Support for Wage Floors
Chief Economic Development Officer Gwen Tillotson presented the proposed Chapter 44 amendments to the Houston Economic Development Committee on September 16, confirming that minimum municipal wage floors and prevailing construction wages would become enforceable community-benefit requirements, according to Citizen Portal. Ahead of that presentation, the mayor's office met with ten council members to align district priorities before circulating red-line language, the outlet reported. Separately, the proposed revisions include a mandate requiring companies to perform at least 15% of total construction labor hours using workers enrolled in U.S. Department of Labor-registered apprenticeship programs, according to the Houston Chronicle.
Salinas has said the changes will improve quality of life for Houstonians and that the city can leverage its power without costing taxpayers more, according to ABC13. She has also said she believes her amendments will pass when brought to a vote and that they would be implemented soon after approval, the station reported. Houston paid out $1.6 million in tax abatements in 2025, according to the Houston controller's report cited by ABC13.
Houston Would Join Regional Peers
Salinas noted in October that regional peers including Harris County, Dallas, and San Antonio already enforce minimum wage and health insurance conditions on tax incentives, leaving Houston's code as an outlier, per the Chronicle. Harris County's own economic development guidelines explicitly disqualify companies and contractors with unresolved wage theft complaints or active federal OSHA safety violations from receiving county tax abatements, according to the Harris County Economic Development Office — a model similar to the wage theft and safety restrictions now proposed in Houston.
Not everyone is convinced the overhaul changes much in practice. University of Texas professor Nathan Jensen has said the policy remains broad and allows tremendous discretion over who receives incentives, according to ABC13. Under Houston's standard Chapter 312 guidelines, a commercial project must currently increase the property's taxable real value by at least $5 million — or $1 million for deteriorated properties — and create or retain at least 25 permanent full-time jobs, according to the Houston Mayor's Office of Economic Development. Projects inside Texas Enterprise Zones face lower thresholds of $500,000 in investment and five created jobs.
Council Discretion Remains a Wild Card
Even if the new labor standards pass, companies would still have to meet stringent requirements to receive the tax benefits, and the City of Houston may remedy issues if companies fail to satisfy the benefit requirements, per ABC13. But council members have shown they retain discretion to waive abatement conditions on individual deals. In August, the council held a public hearing on an $8.7 million, 10-year property tax abatement for NRG Greens Bayou 6 LLC's $549 million natural gas plant expansion, which required members to waive standard rules prohibiting abatements for energy generation facilities, according to Citizen Portal. That project committed to retaining just two full-time equivalent jobs by 2028 while investing heavily in power infrastructure.
The debate also underscores a broader distinction in how Texas cities hand out incentives. In addition to Chapter 312 property tax abatements, municipalities frequently use Chapter 380 agreements, which allow direct cash grants, sales tax rebates, and fee waivers without statutory caps on duration or mandatory reinvestment zone designations, according to Texas Business Grants. Those deals offer cities more flexibility but have faced criticism for limited job-creation tracking, the Chronicle has reported.
Salinas, who joined the council after winning a December 2025 special runoff election for At-Large Position 4 and became the first openly LGBTQ+ Latina elected to the body, previously worked as a Susman Godfrey partner representing voters and election authorities in civil rights litigation, according to the City of Houston. Hoodline covered her runoff win last December, and she has since featured in city debates over a $300 million federal grant tied to immigration enforcement priorities. The council is expected to take up her tax abatement amendments in October.
