Title
Consider/Discuss/Act on a Resolution Approving the Project Plan and Financing Plan for Tax Increment Reinvestment Zone Number One
Summary
MEETING DATE: November 16, 2010
DEPARTMENT: Development Services - Planning Department
CONTACT: Jim Parrish, Deputy City Manager
Mark Houser, City Attorney
John Kessel, Executive Dir. of Development Services
Jennifer Cox, AICP, Director of Planning
Kevin Spath, AICP, CFM, Senior Long Range Planner
RECOMMENDED CITY COUNCIL ACTION: Approval of a Resolution approving the Project Plan and Financing Plan for TIRZ Number One.
ITEM SUMMARY:
• On September 21, 2010, the McKinney City Council created Tax Increment Reinvestment Zone Number One (“Town Center TIRZ”), consisting of approximately 950 acres generally in and around the historic Town Center of McKinney and along State Highway 5 from US 380 to Spur 399/US 75 Interchange (see Ordinance Number 2010-09-034 and as amended by Ordinance Number 2010-10-041).
• On October 19, 2010, the Board of Directors for TIRZ Number One had its first meeting and unanimously passed a Resolution adopting the Project Plan and Financing Plan for the Zone. Pursuant to Section 3(e) of Ordinance Number 2010-09-034, the Board of Directors is required to submit the Project Plan and Financing Plan to the City Council for final approval.
• The Project Plan and Financing Plan as presented to the public and considered by the City Council for the creation of the TIRZ focuses on support for catalytic projects for the continued revitalization of the Town Center; key regional transportation infrastructure for effective access and linkages throughout the Town Center including connections between the Historic Square to the west of Highway 5 and the future Transit-Oriented Development (TOD) to the east of Highway 5, as well as safe auto, pedestrian and bicycle movements along Highway 5 and within the supporting street network of the Town Center; infrastructure and development of the TOD; and for other potential locations and projects that provide opportunity for redevelopment.
BACKGROUND INFORMATION:
• Creation of a TIRZ for the Town Center is an implementation tool for Phase 2 of the Town Center Study. The Town Center Study has provided a community-driven master plan adopted by the City Council in order to direct the redevelopment of and encourage private investment in the Town Center of McKinney including the greater Historic Square, the State Highway 5 Corridor and the future TOD.
• Redevelopment of central cities is often difficult and stunted because of the lack of the ability to aggregate sufficient capacity for the redesign and reconstruction of public infrastructure that benefits the area as a whole. When a large number of small ownership interests, both public and private, exist, no one entity is typically in a position to secure sufficient capacity to invest in common infrastructure for the area. In this context, the TIRZ has been created to provide a mechanism to aggregate capacity to support catalytic projects through infrastructure and other support as identified in the Project Plan for the TIRZ.
• After developing a preliminary Project Plan and preliminary Financing Plan through a City Council TIRZ Committee in coordination with the public process, the City has carried out the necessary steps for the creation of the TIRZ including the creation of the Board of Directors for the TIRZ in accordance with Chapter 311 of the Texas Tax Code.
• The authority of the Board of Directors is established by the City Ordinance Number 2010-09-034 creating the TIRZ. Board authority includes the making of recommendations to the City Council concerning the administration of the TIRZ; and adopting (and amending as needed in the future) a project plan and financing plan consistent with the preliminary project plan and finance plan subject to final approval by the City Council.
FINANCIAL SUMMARY:
• TIRZ revenues will be collected for 30 years from 100% of City property taxes generated above the baseline year assessed property values as of 2010, as well as 100% of City sales taxes above the value of the baseline year of 2010.
• TIRZ revenues will also be collected from 50% of County property taxes generated above the baseline year assessed property values as of 2010, subject to final execution of the Interlocal Participation Agreement with Collin County.
• Projected tax revenues to be collected by the TIRZ will total an estimated $139 Million by the 30th year of the TIRZ in 2040.
• The City Council has created the TIRZ with the primary intention of providing a long-term financing mechanism for critical transportation infrastructure to support and encourage sustained revitalization of the Town Center. Accordingly, the City Council policy in creating the TIRZ was based on the priority to collect and retain revenues in the TIRZ for aggregation to facilitate long-term financing.
BOARD RECOMMENDATION:
• On October 19, 2010, the Board of Directors for TIRZ Number One had its first meeting and unanimously passed a Resolution adopting the Project Plan and Financing Plan for the Zone. Pursuant to Section 3(e) of Ordinance Number 2010-09-034, the Board of Directors is required to submit the Project Plan and Financing Plan to the City Council for final approval.