Does the 1,820-hour employment requirement in the Texas Enterprise Zone Program include paid leave?

Plain-English summary

This is a short June 15, 2007 interpretation letter from the Office of the Governor, Economic Development and Tourism Division, to the Comptroller's Director of Tax Administration, published on STAR as guidance for the Texas Enterprise Zone Program.

The Governor's Office interpreted the "1,820 hours" requirement in Government Code Section 2303.401 to be inclusive of all paid leave. Its definition of "hours of employment" includes:

• regular hours worked,
• overtime hours worked,
• paid vacation leave,
• additional paid holidays, and
• paid sick leave.

The office stated this was the intent of the legislation and asked that the clarification be reflected in the Comptroller's Enterprise Zone Program procedures.

Why it matters: The Enterprise Zone Program measures whether workers are "qualified employees," and the 1,820-hour threshold is used in that determination for enterprise-project benefits. Counting paid leave toward the 1,820 hours makes it easier for an employee to meet the threshold.

Important currency note: This reflects the Governor's Office interpretation as of 2007. It is not a Comptroller letter ruling, and Enterprise Zone Program rules and definitions may have changed since; confirm the current program requirements before relying on it.

What this means for you

Employers participating in the Texas Enterprise Zone Program

When counting an employee's hours toward the 1,820-hour measure, you could include paid vacation, holidays, and sick leave — not just hours actually worked — under this 2007 interpretation. Verify the current program rules with the administering agencies before applying it.

Accountants and economic-development advisors

Note the source: this is a Governor's-Office interpretation adopted into Comptroller procedures, not a tax ruling. Treat it as program guidance and confirm it still governs.

Common questions

Q: Does the 1,820-hour requirement count paid leave?
A: Under this 2007 interpretation, yes — regular and overtime hours plus paid vacation, holidays, and sick leave all count.

Q: Who issued this interpretation?
A: The Office of the Governor, Economic Development and Tourism Division, not the Comptroller.

Citations and references

Statutes:

• Tex. Gov't Code Sec. 2303.401 (Texas Enterprise Zone Program; the 1,820-hour employment measure)

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=FIT
• Opinion: https://star.comptroller.texas.gov/view/200706933L

Original ruling text

Office of the Governor
Economic Development and Tourism
Rick Perry, Governor

June 15, 2007

Mr. William S. Hamner
Director of Tax Administration
Stephen F. Austin Building
1700 N. Congress, Suite 310
Austin, Texas 78701

Subject: Texas Enterprise Zone Program

Dear Mr. Hamner:

It is the interpretation of the Governor’s Office that the “1,820 hours”
requirement in Government Code Section 2303.401 is inclusive of all paid leave.
Our definition of “hours of employment” includes regular hours worked, overtime
hours worked, paid vacation leave, additional paid holidays and paid sick
leave. We feel that this was the intent of the legislation.

Thank you for your assistance in getting this clarification included in the
Comptroller’s Office procedures with regard to the Texas Enterprise Zone
Program.

Sincerely,

Aaron Demerson, Executive Director
Economic Development & Tourism Division

cc: Clarence Goins, Comptroller’s Office
Michael Chrobak, Governor’s Office