BIDCorp To Use TIF for Downtown Redevelopment

Picture1Brownfield’s downtown could get a much-needed face lift in a few years, financed by a unique program adopted by the City Council Thursday morning.

Proposed improvements include a pocket park at the corner of 6th and Main to beautify the current eyesore of a vacant lot, as well as new sidewalks along Main adjacent to the courthouse, corner bump-outs at two intersections, antique lamp posts, re-configured parking on the north side of the courthouse and a decorative wall to shield a vacant lot on the south side of the square.

A Tax Increment Financing (TIF) Zone to fund the $750,000 project was adopted by unanimous vote following a lengthy discussion of how it will work.

Brownfield attorney Jimmy Hammons addressed the council about the legal specifics of the TIF Zone. Hammons has been working on the project with Brownfield Industrial Development Corp. director David Partlow for almost a year.
He told the council that state law allows only cities to create TIF Zones, but added that other taxing entities could opt to join in once they are created.

Partlow said other entities within the TIF Zone boundaries would be approached to participate following the city’s approval Thursday.

“A TIF Zone is a reinvestment zone that allows for a way to generate funds to improve infrastructure or a blighted area to induce growth within a city,” Hammons said. “Basically, it’s a sophisticated type of financing to fund improvements.”

Law requires that TIF Zones be a single concurrent area, rather than several different locations within a city. For that reason, the TIF Zone adopted Thursday has an oddly shaped border with arms stretching to different areas inside the city limits which could see growth.

Any increase in property value that occurs within the TIF Zone over the next five years will benefit the downtown renovation by diverting only the difference in taxes incurred because of the rise in value.

For instance, if existing property within the zone is valued a $10 million, but improvements or additions raise the value to $15 million within the allotted time frame, the taxes generated by that additional $5 million would go into a separate fund to finance the downtown renovation.

It is not a tax increase, because the property would be taxed regardless, but the adoption of the TIF Zone reserves those funds for the specific use.

“Any increase in value inside of that area applies,” Hammons told the council. “We don’t take away any current tax money from the entities. By participating, they just agree to divert the possible increase to the improvement project. A TIF Zone allows a wide array of projects that can be done. It’s a way to generate money to take care of a situation that would help beautify Brownfield and aid in economic development.”

Texas law allows TIF Zone financing for as long as 30 years, but Partlow said only five are needed to fund the project at hand.

Hammons told the council that Brownfield actually was one of the first communities in Texas to do a reinvestment zone back in the 90s, which helped fund several industrial development projects.

Counilman Geronimo Gonzales asked if there is a downside to adoption of the TIF Zone.

Hammons replied that it commits tax revenue to a certain project, but added that the city has no obligation to pay for the project if the TIF Zone doesn’t generate what is projected.

“If this doesn’t make any money, the city won’t have to pay for the project,” he said. “The project just won’t happen and whatever funds were diverted would be restored to each entity involved.”

Ronny Burran, Chief Appraiser, that the current value of all property within the TIF Zone proposed is $8,314,059 — approximately 4.2 percent of the city’s tax base.

Partlow said the TIF Zone has been a year-long process, which began as a way to correct the unsightly appearance of the vacant corner cadi-corner from the newly renovated Terry County Courthouse.

“It’s a blighted area on a main thoroughfare and I was asked to find a way to improve it,” he said. “This won’t happen overnight. We’re going to have to wait a year to find out approximately how much money we’ll be bringing in.”

A $10 million increase in property value within the TIF Zone would generate approximately $110,000 per year for the project.

“Once we know what we’re going to make, we’ll create a TIF Zone board and then it will meet and decide what to do next,” Partlow said.

The council viewed a power point presentation of the potential Kerry Miller, an engineer working on the project, said this was a great opportunity to improve the appearance and the safety of that part of the city.

“Your square has very wide streets on all four sides which is nice, but our plan will improve safety and mobility in the area,” he said. “The timing is great. You just completed the renovation of the courthouse and traffic through town is increasing. Our goal is to develop a functional space that will attract people.”

He said the pocket park could serve as a starting point for the local quilt tour, including an informational keosk. It could also serve as a location for small concerts or street bazaars, he said.

Shifting the angled parking inside a curb would improve the appearance of the block, as well as provide space for landscaping touches such as the lamps and trees or other greenery.

Councilman Jackie Pinson said he liked the idea and lamented that Brownfield does not have a good scenic route that gives a good impression to travelers passing through the city.

Ownership of the lot was questioned and Partlow said he hopes it could be donated to the city for the cause.

The TIF Zone and redevelopment plan were approved by a unanimous vote of the council.

By Brian Brisendine
Courtesy of Brownfield News

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