Now, a new wave of Democratic leaders has the power to stall his projects.FILE Elon Musk gestures next to U.S. Commerce Secretary Howard Lutnick and White House deputy chief of staff for policy Stephen Miller, on the day of the visit of Indian Prime Minister Narendra Modi at the White House in Washington, D.C., U.S., February 13, 2025.

REUTERS/Kevin Lamarque/File Photo (REUTERS)Musk-run companies like SpaceX and Tesla have flourished in the state thanks to white-glove treatment from elected officials—mainly Republicans—including tax incentives, infrastructure benefits, and legislation that makes it difficult to sue his companies. That is about to change, Texas Democrats who spoke to The Wall Street Journal said.Gov.-elect Gina Hinojosa beat incumbent Republican Gov.

Greg Abbott and is suing him to obtain communications between his office and Musk. She campaigned on slowing down data-center development and her opposition to certain land deals that involve the world’s richest man.“His projects are being approved in a way that other projects have not been,” said Democratic state Rep.

Mary González, whose district includes parts of El Paso. “We need to make sure rules are being followed.”Plans for the sale of public parks to SpaceX have drawn particular ire from Democrats and even some Republicans.chartIn September, a federal judge approved a Trump administration decision to transfer about 700 acres of land in a federal wildlife refuge to SpaceX, despite opposition from conservation groups. In Hinojosa’s first news conference as governor-elect on Thursday, she said she had asked to delay the state’s discussions about another land deal in Boca Chica State Park, near the border of Mexico, until after she took office.Musk has a lot planned for Texas.Austin is home to Tesla’s largest U.S. electric-vehicle factory and, it hopes, the future site of mass humanoid robot production.

SpaceX’s manufacturing and launch footprint spans much of South and Central Texas. Musk is planning to build the Terafab, a crucial, multibillion-dollar semiconductor manufacturing project.While the current administration embraced Musk, many Texans have bristled at his expansion plans, especially in rural areas where they threaten the landscape.

In Grimes County, where SpaceX and Tesla plan to build a 100-million-square-foot facility, residents showed up to the county commission meeting in June to argue that the development could ruin their quiet quality of life.Construction is seen north of the Tesla Giga Texas factory in Austin in March.The Texas governor also influences permitting. The Texas Commission on Environmental Quality, a regulatory agency, approves large projects like those proposed by Tesla and SpaceX.

Soon, Hinojosa will be able to appoint commissioners who can act as more of a check on corporate power.Musk has been relatively restrained in his response to the election results, writing on X that “data centers in space looking pretty appealing right now.”SpaceX and Tesla didn’t respond to requests for comment.Musk’s massive campaign contributions have made him a target of many voters. He donated about $160 million to a Republican super PAC in support of Texas Attorney General Ken Paxton’s U.S.

Senate run, but Paxton ultimately lost to James Talarico. The Democrat accused the billionaire of trying to “buy his own personal U.S.

Senator.”“I think very big money has gotten a rubber stamp in Texas for a long time,” said Sarah Eckhardt, the newly elected Democratic comptroller of Texas.Eckhardt previously dealt with Musk’s projects as a county official in Austin and later as a state senator. She says his companies have brought needed economic development to the state, including good-paying career opportunities for people without college degrees.Musk speaking at the Tesla Giga Texas grand opening party in Austin in April 2022.But as Musk committed to more development in Texas, he demonstrated “a lack of civic empathy,” Eckhardt added.In her view, Musk has leveraged his money to pressure small county governments to move quickly on massive projects with few resources to negotiate the terms.

Eckhardt said she wants the state to step in more often if counties want that.Still, incoming Democrats said they want to continue Texas’ growth and business-friendly nature—just without the rubber stamp for Musk. That may even mean incentives for his competition.“I think the environment is going to change into a productive partnership,” Eckhardt said.“It’s a level playing field.

If Amazon and Starlink are competing, they will compete; we will not put our thumb on the scales for one or the other,” she said of the satellite internet service operated by SpaceX.Gina Hinojosa and James Talarico in Austin on Monday, the eve of Election Day.Musk’s shift to Texas began in 2020 after he felt fed up with California’s political climate and regulations.“If a team has been winning for too long, they do tend to get a little complacent, a little entitled, then they don’t win the championship anymore,” Musk told the Journal at the time about his desire to take some of his businesses elsewhere.State leaders rewarded his search for a climate more friendly to his businesses. The state has fewer zoning laws and environmental and labor requirements, and has vast swaths of loosely regulated land.

Unlike California, it has no corporate income tax or capital-gains taxes on individuals.Musk’s critics say Texas has gone above and beyond for him. The state has rewritten laws and developed a new business court to make its state more friendly to controlling shareholders such as Musk.

Despite Texas’ open records laws, Abbott’s office has accommodated requests from Musk’s companies to censor public records with information about their business.A SpaceX facility is seen behind a shore in Boca Chica, Texas, in September.“I think people are tired of feeling like they’re second class, because there are people who are able and willing to throw around so much money that they get whatever they want,” said Democratic state Rep. Gene Wu, whose district includes parts of Houston.Wu said his constituents are done with “the ultrarich continuing to get handouts.”“If he doesn’t want to pay taxes,” Wu added, “that’s too bad because we need public schools and we need roads and we need hospitals.”Write to Becky Peterson at becky.peterson@wsj.com and Rebecca Cadenhead at rebecca.cadenhead@wsj.comGet the latest World News, breaking headlines and global updates from the US, UK, Pakistan, Bangladesh, Russia and other countries along with latest US midterm elections update.

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