In September 2009, the City of Houston Tax Abatement Program was enacted (Ordinance No. 2009-858), establishing a partial tax abatement for U.S. Green Building Council Leadership in Energy and Environmental Design (LEED)-certified commercial buildings. Since its inception, the tax abatement has been renewed three times, most recently in 2016 (Ordinance No. 2016-252).

Abatement Amount

The Ordinance specifies the abatement as follows:

“If the owner of a new or refurbished commercial facility has registered with the U.S. Green Building Council seeking LEED Certification, then the Economic Development Division…may recommend approval by the City Council of a partial tax abatement for the incremental investment associated with obtaining such certification. The agreement shall be effective up to 10 years, at a percentage based upon the level of certification actually obtained after completion of construction or refurbishment":

• Basic “Certified” Level: 1.0%
• Silver Level: 2.5%
• Gold Level: 5.0%
• Platinum Level: 10%”

Minimum Investment Requirement

The LEED building tax abatement can be a stand-alone abatement or part of a standard economic development tax abatement. If used as a stand-alone tax abatement, the minimum investment requirement to be eligible for the partial tax abatement is:

• $1 million for an investment in a commercial structure that achieves Platinum LEED Certification,
• $2 million for an investment in a commercial structure that achieves Gold LEED Certification,
• $4 million for an investment in a commercial structure that achieves Silver LEED Certification, and
• $10 million for an investment in a commercial structure that achieves basic LEED Certification.