Title
Consider/Discuss/Act on a Resolution Approving a Chapter 380 Economic Development Agreement and Project Implementation Agreement with the City of McKinney for a Catalyst Project (Sunset Amphitheatre) Located at 2000 Gateway Boulevard
Summary
COUNCIL GOAL: Direction for Strategic and Economic Growth
MEETING DATE: October 21, 2025
DEPARTMENT: City Manager’s Office
CONTACT: Mark Houser, City Attorney
Jennifer Arnold, AICP, Assistant City Manager
RECOMMENDED BOARD ACTION:
• Staff recommends approval of the proposed resolution in an amount not to exceed $40M.
ITEM SUMMARY:
• Venu Holding Corporation (successor to Notes Live, Inc.) is developing the Sunset Amphitheatre, a new, state-of-the-art entertainment venue located within Reinvestment Zone No. 1, at 2000 Gateway Boulevard (Sunset Amphitheatre).
• The proposed Catalyst Project request is part of a broader public-private partnership designed to promote local economic growth, increase tourism, and enhance the City’s entertainment and hospitality offerings.
• The City of McKinney and its economic development entities (MEDC, MCDC) previously approved a Chapter 380 Agreement with the developer (the VENU Agreement), outlining performance-based economic incentives tied to project completion and operation milestones.
• To fulfill certain financial obligations of the City under the VENU Agreement, participation by Reinvestment Zone No. 1 is requested through a companion TIRZ Agreement that provides a funding mechanism consistent with the TIRZ Project Plan.
• Consistent with the VENU Agreement and the approved TIRZ Project Plan, the proposed participation from Reinvestment Zone No. 1 in the Sunset Amphitheatre Catalyst Project is as follows:
o Up to $3M for the payment of roadway, water, and wastewater impact fees in FY26;
o Up to $6.5M for offsite roadway, traffic controls and related qualified public infrastructure costs associated with the Catalyst Project in FY26; and
o The passthrough of TIRZ-captured sales and use tax revenues and ad valorem real property improvement and business personal property tax revenues from the subject property to offset (in full or in part) the financial incentive obligations of the City per Section 9.8 of the VENU Agreement, beginning in FY 27 and expiring on September 30, 2042. If these revenues are insufficient to fully meet the City’s obligations under the VENU Agreement, the remaining balance will be funded through the General Fund.
BACKGROUND INFORMATION:
• Under Chapter 311 of the Texas Tax Code and Chapter 380 of the Texas Local Government Code, the TIRZ Board has the authority to make loans or grants of TIRZ funds for the purpose of promoting local economic development and stimulating businesses and commercial activity within the reinvestment zone.
• The proposed project is an eligible project in the TIRZ No. 1 Project Plan under the Catalyst Project category, which is defined as “significant or new redevelopment projects for which the total project investment from all sources will exceed $5 million per project and for which the designated project will create a noteworthy mixed-use/residential/civic space(s) that has a direct community benefit or a major employment center(s) or an entertainment destination that serves as an iconic/signature development within the community.”
Specific activities eligible for TIRZ No. 1 funding under the Catalyst Project category include:
• Targeted Economic Development
• Environmental remediation and associated interior/exterior demolition
• Historic façade restoration improvements/easements
• Acquisition and restoration of historic sites (public projects)
• Street, utility, and streetscape improvements
• Municipal land acquisition
• Critical maintenance
• Fire suppression
FINANCIAL SUMMARY:
• FY26 began October 1, 2025.
• The estimated fund balance at the end of FY25 is $27.8 million with $2.6 million being restricted for transportation-related projects only.
• Although total TIRZ participation for this project is capped at $40 million over 16 years, only $9.4 million would be appropriated from Reinvestment Zone No. 1 in FY2026. The remaining $30.6 million would be appropriated annually beginning in FY2027 and capped based on the actual tax revenues generated by the subject property each year during the agreement term.