TIRZ DISTRICTS TO HELP MIDLAND PREPARE FOR FUTURE DEVELOPMENT
(Nov. 14, 2024)
MIDLAND, TEXAS -- A Tax Increment Reinvestment Zone – sometimes referred to as a TIRZ – can help communities plan for future development in a specific area or region in the community.
The Midland City Council is in the midst of approving a pair of zones in west Midland that – when completed – will set up city leaders to plan ahead today for growth that we know is coming. On Nov. 12, the Midland City Council approved – on first reading an ordinance to create two TIRZ districts. The second readings will take place in December.
One TIRZ district – Tax Increment Reinvestment Zone No. 3 – will include nearly 1,800 acres north and south of State Highway 191 west of State Highway 158 (north of 191) and west of Avalon Drive (south of 191).
The other TIRZ district considered – Tax Increment Reinvestment Zone No. 4 – will include 1,066 acres along the Loop 250 west corridor from the development around the Scharbauer Sports Complex to the area around the Cinergy entertainment complex.
The gist of a Tax Increment Reinvestment Zone is that a baseline – as it is concerned to real property values to a taxing entity -- is set. As taxable real property value increases, a portion of that tax increment goes to the taxing entity and a portion goes to the TIRZ. The millions raised over a 30-year period can then be spent on project costs like public utilities, parking and transit improvements, street improvements, pedestrian enhancements, economic development grants, parks and recreation facilities and other public facilities.
The City of Midland estimates TIRZ No. 3 – at 50% participation could mean more than $9.8 million for proposed projects.
TIRZ No. 4 could mean around $38 million, which would be key considering the revenue is needed to maintain and operate the Schabauer Sports Complex. The City announced this month the fund, previously known as the 4B account, is expected to run out of funds in around three years. When the 4B tax was discontinued in 2017, the fund had more than $30 million.
Beal Park also is expected to be added to TIRZ District No. 4.
A TIRZ has a defined boundary, term, board of directors and preliminary project and financing plan. More than one taxing entity can participate in a TIRZ. That is the case with TIRZ No. 2, which is located downtown and includes the City, Midland County, The Hospital District and Midland College. It is expected the City will approach other entities about the TIRZ districts in west Midland.