A Tax Increment Reinvestment Zone (TIRZ) is an economic development tool available to cities under Texas Law. A TIRZ is a specific geographic area defined by the City Council. For the duration of the TIRZ (no more that 30 years), the property taxes from the increased value due to development within the TIRZ is “captured” and placed in a separate fund administered by the City.
The captured tax proceeds can only be used to pay for eligible public improvements within the zone such as streets, drainage, utilities, and public facilities. The underlying concept is that the new taxes from new development are reinvested within the zone that created the additional value. Generally, the developer is required to advance fund the eligible improvements and is only reimbursed with TIRZ proceeds when/if the captured tax proceeds are sufficient.
Property owners within the zone continue to pay the full taxes that are due, so a TIRZ does not create a “tax abatement” situation. The taxes on the “base value” (the property value within the zone before development) continue to flow to the City’s general fund for use city-wide.
TIRZ #2 includes approximately 3,467 acres in the Shadow Creek Ranch development. The TIRZ proceeds are being used to fund the major infrastructure needed to bring this completely vacant property into a developable state. Projected TIRZ projects include extension of Kirby Drive and Hampton Drive (formerly County Road 48), major water and sewer trunk lines, wastewater treatment plant capacity, drainage and detention facilities, recreational areas and trail system, a police/fire substation, and a public library. Improvements within the individual neighborhoods that will comprise Shadow Creek Ranch are not eligible for TIRZ financing under the terms of the TIRZ plan for this development.
The TIRZ #2 Board makes recommendations to the City Council regarding administration of the TIRZ plan and use of the TIRZ proceeds. The Board consists of nine (9) members. Under State Law, appointments are made by the City Council, but members must meet certain eligibility requirements. The Board meets on an as-needed basis.
Time Commitment: Meets as needed about 4 times a year for approximately 1-2 hours.
Position Term: 2 years
Tax Increment Reinvestment Zone Number 2 (TIRZ) Roster
For meeting or additional information, please contact the liaison: John McCarter, Interim Finance Director - 281.652.1650.