Title
Consider/Discuss/Act on a Resolution Approving a Chapter 380 Economic Development Agreement and Project Plan Implementation Agreement with UB33 McKinney LLC for a Fire Suppression, Environmental Remediation, and Critical Maintenance Project Located at 308 W Virginia Street
Summary
COUNCIL GOAL: Enhance the Quality of Life in McKinney
(5C: Promote reinvestment activities and ordinance changes in McKinney's historic downtown that balance preservation of historic character and current market needs)
MEETING DATE: October 21, 2025
DEPARTMENT: Development Services - Planning Department
CONTACT: Cassie Bumgarner - Planning Manager
RECOMMENDED BOARD ACTION:
• Staff recommends denial of the applicant’s request for TIRZ No. 1 funding in the amount of $943,103.64 because the request exceeds funding limits established within the TIRZ No. 1 policy.
• However, Staff is recommending approval of a proposed resolution in the amount of $125,739.12 for the project.
ITEM SUMMARY:
• The applicant requests an economic development grant from Reinvestment Zone Number One in support of a vacant/underutilized project at 308 W Virginia Street. The request is to assist specifically with the following TIRZ 1 eligible expenses under the Vacant/Underutilized Sites/Buildings project category of the Project Plan:
o Critical Maintenance
§ Masonry
§ Shoring
§ Utility Trenching
o Environmental Remediation
§ Asbestos Abatement
o Fire Suppression
§ Fire water
§ Wet fire sprinkler
§ Fire alarm system
o Utilities and Infrastructure
§ Water utilities
§ Sanitary sewer
§ Storm sewer
§ Paving/Misc concrete
• As proposed, the applicant is requesting $943,103.64 in TIRZ funding to offset the cost of this development project.
• Per the TIRZ Administration Policy, the allocation and/or awarding of TIRZ 1 funds for qualified critical maintenance activities shall be limited to $100,000 per qualifying project and shall be considered on a 50/50 match. The allocation and/or awarding of TIRZ 1 funds for qualified fire suppression activities shall be limited to $100,000 per qualifying project and shall be considered on a 50/50 match. The allocation and/or awarding of TIRZ 1 funds for qualified environmental remediation activities shall be limited to $50,000 per qualifying project. The allocation and/or awarding of TIRZ 1 funds for street, utility, and streetscape improvement activities shall be evaluated on a case-by-case basis and brought before the Board for consideration and action.
• The applicant completed the work before submitting the request for funding. Because the work was completed prior to application, they have not provided multiple bids. The subtotal of the critical maintenance work was $147,024.24. The subtotal of the environmental remediation was $4,800. The subtotal of the fire suppression was $94,854.00. The subtotal of the utilities, streetscape, and infrastructure was $696,425.40.
• The applicant is requesting a meritorious exception to exceed the funding cap and to not provide a 50/50 match in the individual categories; the applicant details their total project cost in the applicant presentation.
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 category of Vacant/Underutilized Sites/Buildings, which is defined as “relatively smaller projects (under $5.0 million) for the incremental redevelopment of vacant/underutilized Town Center sites or buildings.” Specific activities eligible for TIRZ No. 1 funding under the Vacant/Underutilized Sites/Buildings category include:
o Environmental remediation and associated interior/exterior demolition
o Historic façade restoration improvements/easements
o Acquisition and restoration of historic sites (public projects)
o Street, utility, and streetscape improvements
o Municipal land acquisition
o Critical maintenance
o Fire suppression
FINANCIAL SUMMARY:
• Each year $400,000 is allocated to the “Vacant/Underutilized Sites/Buildings” project category of Reinvestment Zone Number 1 to support project requests under this category. The current budgeted funds in this account for FY26 are $400,000.
• The three Vacant/Underutilized Sites/Building project requests for the October 21 meeting would come from this $400,000 budget. If these three requests were approved with the amounts staff recommended, the remaining FY26 funds would be $174,969.95.
• The applicant’s request exceeds the allotted amounts available under this project category. As such, approval of the $943,103.64 will require a budget amendment. This budget amendment would be required to fulfill the applicant’s request and would be presented at the next TIRZ meeting, then dependent on the City Council’s approval.
• FY26 began October 1, 2025. The projected fund balance at the end of FY25 is $27.8 million with $2.6 million being restricted for transportation. This fund balance is across all of TIRZ1, which includes catalyst projects.