SPACEX to Pay Grimes County $20 million Annually in Lieu of Taxes

Grimes County negotiated an economic development agreement with SpaceX.  In return for 100% tax abatement SpaceX will:

After negotiation, a $10 million upfront payment and a fixed PILOT of $20 million per year for 35 years. 

There are provisions to protect the environment, requiring SpaceX to comply with all environmental laws, and provisions to protect water. They verified it is not their intention to use groundwater. Provisions to protect the grid, they will be providing their own electricity through power plants. In fact, they will be putting more energy, in excess of their needs, back onto the grid. Noise and light pollution were addressed.

NOTICE OF PUBLIC HEARING Grimes County, Texas The Commissioners Court of Grimes County, Texas, will convene in public session at its regularly scheduled meeting on June 3, 2026 at 9:00am at the Grimes County Commissioner Courtroom, located in the Grimes County Justice & Business Center, 270 FM 149 W., Anderson, Texas, at which the County Commissioners will consider approval of a property tax abatement agreement as described below. 

Name of property owner and applicant for the tax abatement agreement: 

Space Exploration Technologies Corp., a Texas corporation 1 Rocket Road, Starbase, Texas 78521 

Name and location of reinvestment zone in which property is located: 

SpaceX Reinvestment Zone No. 1 – 2026-001 will be located at the Gibbons Creek Reservoir and surrounding areas.

A general description of the nature of the improvements in the agreements is as follows: 

SpaceX proposes construction of a multi-phase, next-generation, vertically integrated semiconductor manufacturing and advanced computing fabrication facility, which would represent a transformative investment in domestic semiconductor manufacturing capacity. 

Estimated cost of improvements or repairs: 

Estimated capital investment for the initial phases is $55 billion, with an estimated total capital investment (if additional phases are constructed) of $119 billion.

During the June 3rd meeting:

Motion by Chad Mallett to Approve a Tax Abatement Agreement between Space Exploration Technologies Corp and Grimes County pursuant to Chapter 312 of the Texas Tax Code and allow County Judge as signatory. Seconded by Phillip Cox. 

Record vote: Commissioner Mallett-Yes Commissioner Tullos-No Commissioner Raska-Yes Commissioner Cox-Yes County Judge-Yes

In Favor: 4 Opposed: 1 Motion Passed

In the same meeting the Commissioners' Court moved and passed the following by the same 4-1 vote:

Discussion and action on approving a Section 381.004 Economic Development Program and Agreement between Space Exploration Technologies Corp. and Grimes County, Texas.

There was no specific information relative to the economic development program and agreement with SpaceX in the meeting background packet, nor was any presented during the meeting.  

Even local politicians love TechGods and their PEU (private equity underwriters) brethren.  Increasingly, more are one in our "self service" oriented world.