Texas Soars into the Future: Driving Innovation and Growth in the Space Industry

With the establishment of the Texas Space Commission in 2024 through House Bill 3447 and rapid innovations toward space commercialization by industry-leading companies, NASA, and institutions of higher education in the state, more aerospace companies and investors are turning their sights to Texas for a supportive regulatory environment to expand their aerospace operations and infrastructure.

Created to “further cement Texas’ position as a national leader in the space industry,” the Texas Space Commission was established in connection with a $350 million investment by the Texas legislature for programs focused on innovation and growth within Texas in civil, commercial, and military aerospace activity.

Of that investment, $200 million is funding the construction of a Space Institute near NASA’s Johnson Space Center, which will focus on lunar and Mars exploration, advanced research and development in aeronautics, and robotics and provide workforce training in the rapidly expanding space industry. Texas A&M is leading the construction and will be the first tenant with the Texas A&M University Space Institute, a 400,000-square-foot, four-story building on 32 acres.

The remaining $150 million is allocated to the Space Exploration and Aeronautics Research Trust Fund (SEARF), which was established to provide grants to eligible businesses, nonprofits, and government entities in Texas for projects related to space exploration, research, and aeronautics, including, among other things, development of emerging technologies for human space flight, conducting space research, workforce training, managing post-mission materials, and building spaceport infrastructure.

As the Trump-Vance administration launches its robust agenda, a clear signal has been sent that the United States will pursue its “manifest destiny into the stars,” and Texas is committed to being at the center of those efforts. The Texas Space Commission is actively underway with efforts to promote innovation in space operations and commercial aerospace opportunities. The nine-member Board of Directors for the Texas Space Commission, who oversee the administration of SEARF recently announced their approval of the first round of SEARF grants to four qualifying recipients at their January 24, 2025 public meeting. These grants will facilitate research and feasibility studies into potential locations in Texas for new launch and inland recovery operations, as well as the development of other space-related infrastructure anticipated to enhance the state’s capabilities in the industry and attract additional business opportunities.  

The grants, totaling $21.5 million for proposed projects, provide up to $500,000 to the Concho Valley Council of Governments, $500,000 to the South Plains Association of Government, $800,000 to El Paso County, and $19,758,376 to the Borderplex Alliance. This approval comes on the heels of the Texas Space Commission receiving 284 grant requests totaling approximately $3.46 billion from 140 unique entities in numerous industries, highlighting the impressive uptick in innovation and broad opportunities in Texas for the aerospace and defense industry. As new locations for launch operations in Texas are solidified and additional infrastructure is developed, Texas, which is already home to NASA and four Federal Aviation Administration-licensed spaceports—including two that are public, Houston and Midland—is poised to facilitate unprecedented advancements in space commercialization.

As aerospace companies and investors eye Texas for operational expansion, the 2024 launch of the Texas Business Courts through House Bill 19 provides yet another valuable benefit to doing business in Texas. With five of 11 geographical divisions already operational in the state’s population centers, Texas has created a sophisticated legal alternative to resolve complex business disputes, aimed at streamlining dispute resolution and facilitating more predictable outcomes from judges who have extensive commercial experience. This compliments existing federal and state courts in Texas, including the US District Courts in the Eastern and Western Districts of Texas, which are well known for adjudicating intellectual property disputes.

Texas Business Courts can be accessed by incorporating dispute resolution and venue-selection clauses into contracts that select the Texas Business Courts as the mandatory forum to resolve qualifying disputes. Seasoned legal counsel familiar with the aerospace and defense industry can also help entities and individuals navigate applicable regulatory and licensing requirements, key legal protections, and available tax incentives for those doing business and investing in Texas. Texas’ creation of the Texas Space Commission, the active efforts of its Board of Directors in tandem with the dynamic Texas Aerospace Research and Space Economy Consortium Executive Committee, and Texas’ clear monetary support for the space industry showcase its commitment to leading the way for future commercial space activities, pivotal innovation, and the next generation of human exploration in space.