BRYAN, Texas (KBTX) – A proposed development by SpaceX at the Gibbons Creek Reservoir in Grimes County is turning heads, with eyes from across the tech industry focused on the rural county anchoring the southeastern end of the Brazos Valley. They include economists at Texas A&M’s Private Enterprise Research Center (PERC), who studied the project’s potential impact on Grimes County and the larger Brazos Valley.

The proposed chip manufacturing plant, known at SpaceX as the “Terafab” project, would be vertically integrated, handling all stages of manufacturing for new semiconductor chips used in Tesla products and eventually in AI data centers deployed in orbit around the earth. The plant would be a joint venture among SpaceX, Tesla, and Intel. The project’s ultimate ambition is to provide a terawatt of AI computing power each year to the technology giants, more than 10 times the current capacity of all AI infrastructure, and allow humanity to become a “galactic civilization” capable of interstellar travel.

While SpaceX and Tesla CEO Elon Musk has said Grimes County is just “one of several” sites under consideration for the massive construction project, Grimes County commissioners have held or scheduled several official meetings about potential tax breaks for the project, culminating in a public hearing scheduled for June 3, where a final vote on any abatement might be taken.

A public notice filed for the June 3 hearing by Grimes County describes the proposed development as “multi-phase, next-generation, vertically integrated semiconductor manufacturing and advanced computing fabrication facility, which would represent a transformative investment in domestic semiconductor manufacturing capacity.”

In cost alone, the transformative nature of the investment is clear. The project’s initial phase could bring an investment of about $55 billion. The company’s total estimate for the project is as high as $119 billion, among the highest manufacturing investments in U.S. history.

Experts at Texas A&M, soon to be home to a $226 million Semiconductor Institute of its own, agree on the project’s potential for seismic impact on Grimes County and the surrounding Brazos Valley.

Terafab and its partner industries, according to the PERC report, would mark a major shift from an agriculture-focused economy in Grimes County to a focus on technology and manufacturing. It’s a shift that could mark a 500% increase in the county’s tax base, which economists estimate at around $11 billion in current market value. In total, Grimes County plans to collect about $26.5 million in property taxes to fund its 2026 budget.

PERC predicts the project would bring thousands of high-wage jobs in semiconductor manufacturing, engineering and technician roles, which could amount to more than 10% of the entire workforce in Grimes County. That demand would also create a need for housing, bringing potential new subdivisions and multifamily housing close to the site, and potential influxes of residents to both Bryan-College Station, the closest metro area to the site, and Navasota, which economists say could serve as an additional gateway community to the site.

Among the closest analogs to SpaceX’s proposed investment is Samsung’s semiconductor plant in Taylor, Texas, which is still under active development but aims to house 1,500 employees by the end of 2026. Samsung’s $17 billion investment in Taylor, however, is dwarfed by SpaceX’s potential $55 billion initial phase.

Still, the tax impacts of the Samsung project on Taylor and surrounding Williamson County have been dramatic, according to PERC, even with significant tax abatements. In 2023, total tax revenues for the City of Taylor, Taylor ISD and Williamson County were just $2,331,544. Total tax revenue in 2025 increased more than 700% to $19,015,133, even without the Samsung facility fully online.

The projected tax impact on Grimes County and surrounding taxing districts is also expected to affect sales tax revenues and prompt utility and broadband upgrades, road improvements and expansion of schools and medical facilities to accommodate growth.

Read PERC’s full report on the potential expansion.