The city began negotiations with the company at its Sept. 7 meeting, Community Impact Newspaper previously reported.
A TIRZ finances development with future incremental tax revenue, City Attorney Loren Smith said. While the development adds incremental value, it will continue to be taxed at a base value for the duration of the TIRZ, Smith said.
The development is also being considered to become a municipal management district, or MMD, Smith said. An MMD is similar to a municipal utility district in that it can levy taxes and issue bonds, but it also has broader powers, such as the ability to build roads and annex other properties.
Council Member Lori Klein Quinn raised many concerns during the meeting. She said she would like to see the TIRZ be in place for 15 years and cap the tax rate of the MMD as well as denying any annexing powers.
“This is not a decision that the council is taking lightly,” Klein Quinn said.
City Manager David Esquivel clarified the terms of the agreement as it stands. He said the TIRZ is set for 30 years and that it would not have the ability to annex.
The city would receive 25% of the growth on top of the base tax value of the TIRZ as well as 50% of the sales tax generated by the retail portion of the development, Esquivel said. He said the MMD would act as a backstop to make sure the development can recoup its debt.
“If that increment doesn’t gain as much as what we’re thinking, then they can levy the appropriate tax to pay for the debt they issue,” Esquivel said. “We don’t anticipate having to do that.”
City Council will hold a special meeting for a public hearing to consider the TIRZ on Nov. 29. If approved, it would be the city's third TIRZ.
During the meeting, City Council also unanimously approved the first reading of the annexation of the Lovett Industrial property. The second reading and approval will take place Dec. 6.
City Council was also scheduled to hold a public hearing to discuss the rezoning of the property to 231.6 acres of light industrial space and 8.4 acres of general retail. However, the council tabled the hearing until Nov. 29.
