SpaceX Wants a Tax Break for a $24 Billion Starbase Supercomputer

SpaceX is seeking tax incentives for a proposed supercomputer facility and gas-fired power plant in Starbase, Texas, with an estimated $24 billion in capital investment for the project’s initial phases.

A City of Starbase public notice sets a December 9 hearing on the proposed incentive agreements, adding a major South Texas project to the picture of SpaceX’s growing AI computing business. The commission will consider the incentive agreements at that meeting. The notice does not approve them.

The applicant and property owner is Space Exploration Technologies Corp., the legal name of SpaceX. Its proposed site covers approximately 444 acres inside Starbase city limits, just east of Brownsville between Boca Chica Boulevard and the Port of Brownsville.

The $24 billion estimate covers the initial phases of the combined project, which could be built in stages and expanded later. It is not the value of the tax break, and the notice does not put a price on future expansions.

What SpaceX is asking Starbase to consider

Two agreements are on the table: a property tax abatement under Chapter 312 of the Texas Tax Code and a related economic development agreement under Chapter 380 of the Texas Local Government Code.

The public notice does not disclose the proposed abatement percentage, its duration or the financial terms of the economic development agreement. Those details will determine how much support the city would provide and what SpaceX would need to deliver in return.

For now, the project description is limited to a gas-fired power plant and a “super-compute facility.” It does not identify the chips, computing capacity, customers, construction schedule or water requirements.

SpaceX already has a substantial computing presence through its Mid-South AI hub in Memphis and Southaven. The company is also expanding Colossus 2 with the Gun Range and Spam clusters, with configurations aimed at AI training and inference.

A Starbase campus could add another major location to that buildout, with power generation included in the same proposal. However, the city notice does not say how this facility would be used or connect it to a particular Grok product or customer contract.

The commission meeting is scheduled for 7 p.m. on Wednesday, December 9, 2026, at 48491 State Highway 4 in Starbase. The city’s public hearing notice invites interested people to attend and speak on the proposed agreements.

What would you want to see in the tax-incentive terms for a project of this size?