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MAY THE 16TH AND I'M GOING TO CALL THIS SPECIAL CITY COUNCIL MEETING TO ORDER.
WOULD THE CITY SECRETARY PLEASE CALL THE ROLL.
I CHOSE ELLISON FLORES, KALE HERE.
WE HAVE A QUORUM NEXT UP CITIZEN COMMENTS, PERIOD.
IS THERE ANYONE WHO WISHES TO COME FORWARD AND SPEAK? COME ON BRAD.
UH, I JUST WANTED TO INTRODUCE MYSELF.
UM, I DIDN'T ACTUALLY HAVE ANYTHING PREPARED, BUT I WANTED TO SAY THAT I, UH, MY NAME IS JIM MADDIX.
I AM ONE OF THE OWNERS OF THE CAIRO FLEA MARKET.
THAT'S RIGHT HERE, UH, HERE IN KYLE.
UM, I UNDERSTAND THAT, UH, UH, THERE HAS BEEN A LOT OF CONCERN REGARDING, UH, REGARDING THE MARKET RECENTLY AND, AND CONCERNS AND QUESTIONS ABOUT THAT.
I WOULD LOVE TO BE ABLE TO ANSWER ANY AND ALL OF YOUR QUESTIONS.
I'M AN OPEN BOOK, SO WE'RE, SO WE'RE WE DOWN THERE, WE'RE TRYING TO KIND OF SEE WHAT WE CAN DO TO HELP THE CITY OF KYLE, WHETHER THAT MEAN US IMPROVING OR DEVELOPING, OR JUST FIGURING IT OUT.
UH, I HADN'T SPOKE TO ANYBODY ABOUT IT.
NOBODY HAD COME TO SPEAK TO ME ABOUT THE, ABOUT THE MARKET AND ITS KIND OF FUTURE.
SO I'M HERE KIND OF JUST BEING LIKE, OKAY, WELL I'LL TAKE THE INITIATIVE.
UH, SO IF ANYBODY HAS QUESTIONS AND CONCERNS, UM, I'M HAPPY TO GIVE YOU ALL MY NUMBER.
UH, I DO WORK MONDAY THROUGH FRIDAY, BUT I CAN TAKE TIME OFF AND DO WHATEVER ELSE I NEED TO, TO MEET WITH Y'ALL.
UM, AGAIN, I KNOW THAT'S PROBABLY NOT NEARLY EVEN CLOSE TO THE PURPOSE OF WHY WE WERE HERE, BUT UNDERSTANDING THAT I FIGURED I WOULD AT LEAST INTRODUCE MYSELF AND THINK, THANK YOU VERY MUCH.
UH, ANYONE ELSE WHO SHOULD COME FORWARD? ALL RIGHT.
SEEING NONE, WE'RE GOING TO CLOSEST AND COMMENTS PERIOD.
IT'S NOW CLOSED NEXT UP A PRESENTATION REGARDING TAX INCREMENT, REINVESTMENT ZONES AND PUBLIC IMPROVEMENT DISTRICTS.
MISS STEPHANIE LIVE A NAN, THEIR COUNCIL MEMBERS KIND OF MS. STEPHANIE LIVELY PARTNER WITH NORTON ROSE FULBRIGHT.
I'M HERE TONIGHT TO PROVIDE PRESENTATION TO THE CITY COUNCIL REGARDING TAX INCREMENT REINVESTMENT ZONES.
UM, THE PURPOSE OF THIS PRESENTATION WOULD BE TO INFORM BOTH COUNCIL AND STAFF OF THE OVERALL, UH, TOURIST PROCESSES, INCLUDING BENEFITS THAT A TOROS CAN PROVIDE, UH, ANY RESPONSIBILITIES ASSOCIATED WITH CREATION, TIMING, THE DIFFERENT TYPES OF FINANCING OPTIONS THAT WOULD BE AVAILABLE AND THEN PERMITTED USES OF THOSE TAX INCREMENT REVENUES FOR THE ITEMS THAT WE'LL COVER IN THIS PRESENTATION.
WE'LL GO THROUGH THE INTRODUCTION GENERAL INFORMATION REGARDING THE TOURIST, A TOURIST INTERPLAY WITH PIDS, HOW THEY CAN BE USED TOGETHER, AND THEN QUESTIONS.
WHAT I'VE DONE TO PREPARE FOR TONIGHT'S PRESENTATION IS TO WATCH SOME OF YOUR PRIOR CITY COUNCIL MEETINGS.
AND THE PRESENTATION IS GEARED TOWARDS ANSWERING THE MOST COMMONLY ASKED QUESTIONS.
THIS CAN BE AS PRESENTATION TYPE OR Q AND A THAT YOU GUYS FEEL MOST COMFORTABLE WITH.
SO IF YOU HAVE ANY QUESTIONS, AS I'M MOVING ALONG, PLEASE FEEL FREE TO STOP ME.
HOWEVER YOU GUYS FEEL MOST CONFIDENT TO MAKE SURE THAT YOUR QUESTIONS ARE ANSWERED.
SO I'M GOING TO JUMP IN AND JUST, JUST TO SAY THAT THIS, EVEN THOUGH IT FEELS FORMAL, THIS IS WORKSHOP.
SO THE GENERAL RULE FOR THE COUNCIL, UH, WILL BE, WE'RE NOT DOING HANDS.
THE GROUND RULES I WOULD LIKE TO SET IS THAT THIS IS NOT WHERE WE'RE GOING TO, UH, WE'RE NOT GOING TO DEBATE, UH, WHETHER OR NOT TERRORS IS OUR, WHAT WE WANT TO DO, BUT WE'RE HERE TO LEARN AND ASK QUESTIONS.
UM, AND SO AS LONG AS THE CONVERSATION IS IN THAT SPIRIT WHERE WE'RE TAKING ADVANTAGE OF THE RESOURCE THAT WE HAVE, THEN, THEN YOU CAN JUST GO AND, AND FOLKS CAN JUST JUMP RIGHT IN WHENEVER THEY, IF THEY HAVE ANY KIND OF CLARIFYING QUESTION ON SOMETHING THAT YOU'RE PRESENTING, IF THAT WORKS FOR YOU.
I THINK THE ONLY OTHER CAVEAT THAT I WAS GOING TO ADD IS THAT I WAS ASKED TO COME HERE TO BE A RESOURCE TO COUNSEL BASED ON MY PRIOR WORK EXPERIENCE.
I'VE NOT BEEN RETAINED BY THE CITY, SO I'M NOT THE CITY'S ATTORNEY.
SO I'M NOT IN A POSITION TO ANSWER ANY LEGAL QUESTIONS OR ANY QUESTIONS REGARDING ANY SPECIFIC ZONE THAT MAY BE PROPOSED BEFORE THE CITY.
THIS IS DEFINITELY MORE HIGH LEVEL, UM, TOURISM IN GENERAL, SOME OF IT'S THE HISTORY ASSOCIATED WITH THE FINANCING AND THEN SOME, UH, STATUTORY REVISIONS THAT HAVE OCCURRED THROUGH THE YEARS THAT HAVE EXPANDED THOSE POWERS.
SO A LITTLE BIT OF BOTH, BUT ABOUT OUR FIRM AND MYSELF.
SO, UH, LIKE I SAID BEFORE, I'M A PARTNER WITH NORTON ROSE FULBRIGHT.
THE FIRM ITSELF HAS BEEN IN TEXAS SINCE 1923.
WE'RE ONE OF THE LARGEST TEXAS, OR ONE OF THE LARGEST PUBLIC FINANCE FIRMS, BOTH IN THE STATE AND IN THE TEXAS, BOTH IN THE STATE AND THE UNITED STATES AND TEXAS, WE HAVE 19 PUBLIC FINANCE ATTORNEYS WHO PRACTICE THROUGH FOUR OFFICES AND WE HAVE FOUR ATTORNEYS WHO ARE DEVOTED SPECIFICALLY TO A FEDERAL TAX, AS IT RELATES TO ISSUING TAX EXEMPT BONDS.
AND THE LAST 10 YEARS WE'VE SERVED AS BOND COUNSEL OVER ON OVER 808,300 BOND ISSUANCES,
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UH, TOTALING OVER $514 BILLION, UH, FROM, UH, $14 BILLION LAST YEAR, WE'RE RANKED FOURTH AS BOND COUNSEL IN THE NATION.FIRST AS UNDERWRITER'S COUNSEL FOR MYSELF, I HAVE OVER 20 YEARS OF PUBLIC FINANCE EXPERIENCE BEFORE I JOINED THE FIRM IN 2015, I HAD SERVED AT THE TEXAS ATTORNEY GENERAL'S OFFICE FOR 13 YEARS, INCLUDING FOUR YEARS AS CHIEF OF THE PUBLIC FINANCE DIVISION.
I HAVE PUBLIC EXPERIENCE RELATED TO ANY AND EVERY TYPE OF A TAX EXEMPT BOND THAT CAN BE ISSUED.
UM, WHEN I WAS CHIEF OF THE PUBLIC FINANCE DIVISION, WE REVIEWED OVER 1500 PUBLIC SECURITIES THAT ARE ISSUED IN THE STATE OF TEXAS ON AN ANNUAL BASIS AS CHIEF OF THE DIVISION.
I REPORTED TO WHAT WAS CALLED A DEPUTY ATTORNEY GENERAL FOR LEGAL COUNSEL.
UM, THOSE SUPERVISORS INCLUDE A CURRENT TEXAS SUPREME COURT JUSTICE AND A JUDGE ON THE FIFTH DISTRICT COURT OF APPEALS.
AND SO THE PEOPLE THAT I WAS REPORTING TO RELATED TO BOTH LEGAL EXPERIENCE AND INTERPRETATION OF TEXAS LAW, UM, HAVE NOW BEEN ELEVATED TO THOSE POSITIONS.
I'M ALSO A GUBERNATORIAL APPOINTEE TO THE TEXAS PENSION REVIEW BOARD.
I SERVE IN THE STATE RELATED TO EXPERTISE IN GOVERNMENTAL FINANCE.
I WAS APPOINTED TO THE BOARD IN 2015 AND CURRENTLY SERVE AS ITS CHAIR FOR THE, FOR THE EXPERIENCE WE HAVE RELATED SPECIFICALLY TO TOURISM PEDS IS WE ROUTINELY ADVISE ON TURDS AND PID CREATIONS AND FIND AND FINANCINGS EITHER AS BOND COUNSEL OR UNDERWRITER'S COUNSEL, THESE FINANCINGS CAN NEITHER BE USED INDEPENDENTLY OF EACH OTHER OR IN CONJUNCTION.
WHEN I WAS AT THE TEXAS ATTORNEY GENERAL'S OFFICE IN 2008, I DEVELOPED THE AGENCY'S PIT GUIDELINES.
THEY'VE HAVE BEEN APPROXIMATELY 225 PIT FINANCINGS IN THE STATE OF TEXAS.
OUR FIRM THROUGH VARIOUS ROLES HAS PARTICIPATED IN ABOUT HALF OF THEM, EITHER AS BOND COUNSEL, UNDERWRITER'S COUNSEL OR TRUSTEES COUNSEL, WE CAN ADVISE ON PEDS AND TOURIST STRUCTURING.
AND WE CAN ALSO ADVISE AS IT RELATES TO NOVEL FINANCING STRUCTURES THAT MAY ARISE DEPENDENT ON A PARTICULAR PROJECT.
AND THEN FINALLY WE VIEW OUR ROLE AS BOND COUNCILS, HOLISTIC APPROACH.
AND SO WHETHER IT'S FROM THE VERY BEGINNING OR THE END STAGES OF YOUR PUBLIC FINANCE, OR EVEN POST ISSUANCE SECURITY LAW OR TAX MATTERS, WE HAVE SOMEONE WITHIN THE FIRM THAT CAN ADVISE ON ALL ASPECTS FOR A TAX INCREMENT SENSE.
THIS IS NOT A CONCEPT THAT IS UNIQUE TO TEXAS IT'S USED THROUGHOUT THE UNITED EARTH THROUGHOUT THE UNITED STATES.
TERRACES ARE SPECIAL ZONES THAT ARE CREATED BY CITY COUNCIL TO ATTRACT NEW INVESTMENT TO A PARTICULAR AREA.
THE TOURISTS WILL HELP FINANCE THE COSTS OR THE COST OF DEVELOPMENT OR REDEVELOPMENT OF AN AREA THAT WOULD NOT OTHERWISE ATTRACT SUFFICIENT MARKET DEVELOPMENT.
AND A TIMELY MANNER TAX IS ATTRIBUTED TO THE NEW IMPROVEMENTS ARE SET ASIDE TO FINANCE PUBLIC IMPROVEMENTS THAT BENEFIT THE ZONE.
THE STATUTORY, UM, REQUIREMENT IS THAT THE IMPROVEMENTS HAVE TO BENEFIT THE ZONE.
NOT THAT THEY HAVE TO BE WITHIN THE ZONE.
SO TOURIST IMPROVEMENTS CAN BE EITHER INSIDE OR OUTSIDE OF THE BOUNDARIES OF THE ZONE ITSELF.
SO LONG AS THE BENEFITS ARE RECEIVED BY THE AREA WITHIN THE ZONE, IT COULD BE A ROAD IMPROVEMENT.
IT COULD BE A WATER SEWER IMPROVEMENT.
IF YOU HAVE A LIFT STATION AND THAT LIFT STATION WOULD BE LOCATED OUTSIDE OF YOUR ZONE, BUT IT PROVIDED TREATMENT OR WATER DELIVERY TO THE AREA WITHIN THE ZONE, THEN THAT IMPROVEMENT COULD BE OUTSIDE OF THE ZONE.
THE LAND HAS NOT BEEN IN A CERTAIN TIME BECAUSE THERE HAS NOT BEEN ATTRACTION.
SO TIMELY MANNER, JUST LIKE WHEN WE COME INTO A DISCUSSION ABOUT DEVELOPED UNDEVELOPED OR REDEVELOPED, SOME OF THOSE DETERMINATIONS ARE MADE BY COUNSEL USING DISCRETION.
AND SO LONG AS THE DISCRETION THAT IS, UH, USED IS NOT ABUSIVE, THEN THAT WOULD REMAIN SO TIMELY MANNER CAN BE, YOU KNOW, JUST THE FACT THAT DEVELOPMENT HAS OCCURRED ALL AROUND THIS TRACK AND THIS TRACK FOR ONE REASON OR OTHER HASN'T DEVELOPED, IT COULD BE THAT IT SITS ON A PARTICULAR AREA OF THE CITY WHERE NO DEVELOPMENT IS OCCURRING.
SO THERE ARE LOTS OF DIFFERENT VARIABLES THAT COULD GO INTO DETERMINE WHETHER OR NOT SOMETHING IS BEING UNDERTAKEN IN A TIMELY MANNER.
I HAVE A QUESTION, UM, REGARDING THE LAST SENTENCE IN THE SECOND BULLET POINT, IT SAYS UNDER THE TEXAS CONSTITUTION, DOES THAT MEAN THAT THE STATUTE GOES DERIVES FROM THE TEXAS CONSTITUTION? SO THAT IS LIKE, SO THE TEXAS CONSTITUTION, UH, HARRISON XR OF THE CONSTITUTIONAL LANGUAGE RIGHT HERE, ONE G IS
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THE STATUTORY PROVISION THAT RELATES TO TAX INCREMENT FINANCING, ONE A OR ONE A RELATES TO, UH, PROPERTY TAX ABATEMENTS.ONE GB IS THE SECTION THAT PERTAINS TO TAX INCREMENT AND TAX INCREMENT FINANCING.
AND SO YOU'LL SEE THE ACTUAL STATUTORY LANGUAGE IS THAT THE LEGISLATURE, BUT BY GENERAL LAW MAY AUTHORIZE AT NAIL RAISE A CITY OR COUNTY TO ISSUE BONDS OR NOTES TO FINANCE THE DEVELOPMENT OR DEVELOPMENT OF AN UNPRODUCTIVE UNDERDEVELOPED OR BLIGHTED AREA WITHIN THE COUNTY OF THE CITY OR THE CITY'S ETJ.
SO WHAT YOU HAVE IS YOU HAVE CONSTITUTIONAL AUTHORITY, THAT'S BEEN DELEGATED BY THE LEGISLATURE FOR THE LEGISLATURE TO AN ACT LAWS THAT WOULD ACCOMPLISH THE DEVELOPMENT OR REDEVELOPMENT OF UNPRODUCTIVE UNDERDEVELOPED, OR BLINDED AREAS.
AND THEN THAT STATUTORY AUTHORITIES FOUND IN THREE 11 OF THE TAX CODE.
CAN I ASK ONE MORE QUESTION? UM, MY, MY OVERALL CURIOSITY IS WHAT KIND OF BENEFITS DO DOES A DEVELOPER RECEIVE FROM A TERSE? WELL, I GUESS WHAT TYPES OF BENEFITS, THE TYPES OF BENEFITS? SO THE DELIVER OVERSEAS FROM A TOURIST CAN BE MULTIFACETED.
AND I GUESS IN SOME RESPECTS LIKE A PIT, THERE ARE CERTAIN PUBLIC INFRASTRUCTURE THAT NEEDS TO BE PAID FOR AND RELATION TO A NEW DEVELOPMENT.
AND SO THROUGH PIDS IN TOURIST IS YOU HAVE TWO STATUTORY TOOLS THAT ARE FOR LACK OF BETTER WORD TOOLS IN THE TOOLBOX THAT CAN BE USED TO PAY FOR PUBLIC IMPROVEMENTS.
WHEN WE MOVE INTO THREE 11 OF THE TAX CODE, WE'LL SEE THE TUFTS OF FINANCE, THE TYPES OF PUBLIC INFRASTRUCTURE THAT CAN BE PLACED IN THERE.
AND THEN THE LEGISLATURE IS ALSO PROVIDED CITIES AND COUNTIES WITH THE AUTHORITY TO DO THREE 80 AGREEMENTS UNDER, UM, UNDER CHAPTER THREE 11.
AND SO IT IS POSSIBLE TO DO LOANS AND GRANTS OF TOURS, REVENUES DIRECTLY TO A DEVELOPER.
UM, THERE ARE STATUTORY RESTRAINTS ON THE AMOUNT OF, UH, THE SPECIFIC DOLLAR AMOUNT OF THOSE LOANS OR GRANTS.
SO THE THREE 80 WOULD ESSENTIALLY HAVE THE CITY PAIN FOR THE INFRASTRUCTURE UPDATES.
UH, THE THREE 80, NO, THE THREE 80 WOULD BE, UM, A DIRECT, UH, MONETARY, UH, DIRECT PAYMENT FROM THE CITY TO, UH, THE DEVELOPER SO THAT IF THE CITY SO CHOSE, THEY COULD ENTER INTO A THREE 80 AGREEMENT AND PROVIDE, UM, PUBLIC FUNDS TO DEVELOP OR UNDER THE THREE 80 AGREEMENT.
THE NEXT SLIDE JUST PROVIDES A GENERAL OVERVIEW OF THE STEPS THAT ARE REQUIRED, UM, AND THE PROCEDURES FOR CREATING A REINVESTMENT ZONE.
AND IT SPECIFIES THAT A CITY BY ORDINANCE MAY DESIGNATE A CONTIGUOUS OR NON-CONTIGUOUS GROUP GEOGRAPHIC AREA.
THAT'S EITHER WITHIN CITY LIMITS, BE TJ OR A COMBINATION OF BOTH CITY LIMITS AND ATJ, UH, TO CREATE A RE-INVESTMENT ZONE ONCE AGAIN, TO PROVOKE, TO PROMOTE DEVELOPMENT OR REDEVELOPMENT, AND THE AREA AT THE GOVERNING BODY DETERMINES THAT DEVELOPMENT OR REDEVELOPMENT WOULD NOT OCCUR SOLELY THROUGH PRIVATE INVESTMENT AND THE RE REASONABLY FORESEEABLE FUTURE.
AND SO THIS COMES BACK TO THE TIMELY MANNER QUESTION THAT WAS POSED EARLIER FOR WHAT CONSTITUTES A TIMELY MANNER, THE TIMELY MANNER.
AND SO THE LEGISLATURE HAS SAID REASONABLY FORESEEABLE FUTURE WOULD BE TIMELY.
NEXT SLIDE PROVIDES JUST LEGISLATIVE HISTORY UP BOTH CONSTITUTION AND CHAPTER THREE 11.
SO YOU CAN SAY, UH, GOING BACK TO 1977, THERE WAS A PROPOSED CONSTITUTIONAL AMENDMENT THAT WOULD HAVE CREATED A TAX INCREMENT REINVESTMENT SENSE INSTEAD OF TEXAS.
AND THAT CONSTITUTIONAL AMENDMENT DID NOT PASS.
WHAT WE HAVE NOW IS ARTICLE EIGHT, SECTION ONE G WAS PASSED IN 1981 AS S J R EIGHT AFTER S J R EIGHT PASSED.
WE HAVE CODIFICATION OF WHAT IS NAILED CHAPTER CURRY, 11 OF THE TAX CODE, AND THEN STARTING FROM 2005 THROUGH PRESENT DAY, THIS WILL WALK YOU THROUGH ALL THE STATUTORY AMENDMENTS RELATED TO THREE 11 OF THE TAX CODE.
WHICH THE CONSTITUTIONAL AMENDMENT PROP TWO WAS APPROVED WITH 63% OF THE VOTES TO ALLOW COUNTIES TO INDEPENDENTLY CREATE TERCES WAS NOT APPROVED.
SO KELLY CAN CREATE A TERSE, UH, COUNTY CAN NOW CREDITORS AFFECTED 20, 21 NOVEMBER, 2021.
THERE WAS A CONSTITUTIONAL AMENDMENT THAT NOW ALLOWS COUNTY COUNTIES TO CREATE TO RESIST.
SO IS THAT DIFFERENT SO THAT, UM,
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SO COUNTIES PARTICIPATE IN THE WAY THAT IT WORKS FOR US IS THAT THE COUNTY PARTICIPATES THROUGH AN ILA.THEY ACTUALLY DO NOT PARTICIPATE WITH US.
AND MY UNDERSTANDING IS THAT THE REASON THAT THEY DIDN'T IS BECAUSE THEY COULDN'T.
SO I GUESS NOW THEY CAN PRIOR TO, YEAH.
SO I PROBABLY ARE TO NOVEMBER, 2021.
UM, THERE WERE TWO AJA OPINIONS ON THE ISSUE THAT SAID COUNTIES COULD NOT INDEPENDENTLY CREATE TAX INCREMENT.
THAT WAS WHAT I THAT'S HOW I'VE ALWAYS, I JUST DIDN'T REALIZE THIS CHANGE WAS MADE SO THEY CAN CREATE AN INDEPENDENTLY, BUT COULD THEY PARTICIPATE JOINTLY, BUT OFFICIALLY, AS OPPOSED TO AN ILA WHERE THEY'RE PROVIDING IT WAS ALWAYS SENT HER AN ILA WHERE THEY AGREED TO CONTRIBUTE A CERTAIN PART OF TAX INCREMENT, JUST LIKE THE CITY WOULD AGREED TO, UH, CONTRIBUTE THEIRS AND THEN THROUGH PARTICIPATION, THEY COULD ALSO GET A SEAT ON THE TOURIST BOARD.
SO THE DIFFERENCE WOULD BE THE WAY I SEE IT IS, UM, YOU CAN'T COUNT THE REVENUES DERIVED FROM THE COUNTY IF THEY'RE PARTICIPATING THROUGH AN ILA AND NOT THROUGH ACTUALLY BEING A PART OF THE TERRORS, IF THEY'RE JUST, YOU CAN'T COUNT THOSE, UH, REVENUES AS, UM, UM, SOMETHING YOU CAN BORROW AGAINST, FOR EXAMPLE, BECAUSE IT'S SUBJECT TO APPROPRIATIONS FROM THE COUNTY IS WHAT THEY WOULD SAY.
AND SO THE MONEY WE WOULD GET IN A TERM FROM THE COUNTY, IT'S NOT QUITE THE SAME AS THE MONEY THAT IS GENERATED FROM THE CITY, BECAUSE THEY'RE ACTUALLY CREATING A TERRORS.
BUT IF THIS IS THE CASE, THEN THE COUNTY WOULD PARTICIPATE.
THEN THEIR FUNDS WOULD BE SECURED IN THE TERMS IN THE SAME WAY THAT ARE LIKE, WE CAN'T, YOU KNOW, TERS ONE, TWO, AND THEN EVENTUALLY TURN THREE, WHEN THOSE MONIES COME IN, WE CAN'T JUST SAY, NO, WE'RE NOT GONNA, YOU KNOW, USE THOSE MONIES IN THE SAME WAY THAT WE DID THE YEAR BEFORE THEY'RE THERE.
TERS UM, WHEREAS THE ILA, THE MONEY GOES TO THE HAYES COUNTY GENERAL FUND, AND THEN THEY APPROPRIATE THAT THROUGH AN AGREEMENT WITH THE, JUST NOT QUITE AS LEGALLY STRONG.
SO, SO I DON'T KNOW IF I COULD SPEAK TO THE ACTUAL FUNCTIONING OF HOW THE REVENUES ARE APPROPRIATED BY THE COUNTY, DEPENDING ON IF THEY'RE A PARTICIPANT OR NOT.
UM, AND THE FINANCINGS THAT I'VE PARTICIPATED IN, WHERE WE HAVE PARTICIPANTS, THEY ARE BONDING OFF OF THOSE, BOTH OF THE COUNTY REVENUES, EVEN THOUGH THEY'RE NOT IN.
WELL THEN MAYBE IT'S NOT THAT MUCH OF A DIFFERENCE, BUT I WAS IN THE PAST THAT WE'VE BEEN TOLD THAT THE COUNTY REVENUES COULDN'T BE USED FOR DEBT SERVICE.
THIS SLIDE JUST KIND OF SHOWS THERESA'S ACROSS THE STATE OF TEXAS AND, UH, INFORMED CITY COUNCIL OF RELATED TO ANNUAL REPORT REQUIREMENTS, UH, UNDER THREE 11 OF THE TAX CODE AND A CITY THAT HAS A TOURIST MUST SEND A COPY OF AN ANNUAL REPORT RELATED TO THAT TOURIST ALL TO THE COMPTROLLER.
UH, THE COMPTROLLER'S WEBSITE INCLUDES DETAILED INFORMATION, BOTH RELATED TO THREE 11 AND TO TOURISM IN GENERAL.
UM, IF YOU HAVE THE PRESENTATION PULLED UP ELECTRONICALLY, THE LINK THAT'S INCLUDED IN THE PRESENTATION IS A HYPERLINK.
IT WILL TAKE YOU TO THE COMPTROLLER'S WEBSITE, WHERE YOU CAN SEE ALL OF THE INFORMATION THAT THE COMPTROLLER'S OFFICE KEEPS ON.
UM, TAX INCREMENT REINVESTMENT SENSE THROUGHOUT THE STATE FOR THE COMPTROLLER'S MOST RECENT BIENNIAL REPORT.
THE COMPTROLLER PROVIDES THAT THERE WERE OVER 350 TOURISM WITHIN THE STATE OF TEXAS.
THOSE OF COURSE ARE NOT ALL THE TOURISM IS JUST THOSE THAT ARE COMPLYING WITH THEIR STATUTORY REQUIREMENTS TO MAKE REPORTS TO THE COMPTROLLER.
AND THEN THE BIANNUAL REPORT ALSO IDENTIFIES THE AMOUNT OF PARTICIPATING ENTITIES WITHIN A TOURIST.
AND SO THERE WERE 350 TOURISM GRID WITH, WITHIN THE STATE AND THERE ARE 850 LOCAL GOVERNMENTS PARTICIPATING IN TOURISTS.
AS OF THE LAST BITE YOU HAVE REPORT IN 2020, OUR SMALLEST PHILLY'S ALLOWED TO, UH, CRATERS ARE JUST HOME RULE CITIES, ALL CITIES, ALL CITIES.
UH, THIS IS JUST A SLIDE THAT SHOWS AND PROBATION THAT WE PULLED FROM THE COMPTROLLER'S WEBSITE.
IT PROVIDES FUND BALANCES RELATED TO ALTURAS REVENUES THAT ARE CURRENTLY SITTING IN FUNDS $909 MILLION, TOTAL REVENUES, TOTAL EXPENDITURES, THE AMOUNT OF BONDED DEBTEDNESS SECURED BY TOURIST, TOURIST REVENUE BONDS.
THAT'S CURRENTLY OUTSTANDING, JUST OVER A BILLION DOLLARS.
UM, ALSO PROVIDES TAX INCREMENT BASED AND CAPTURED VALUES ONCE AGAIN, FOR ALL TOURISM WITHIN THE STATE.
SO FOR EVERY TOURIST IN THE STATE, YOU HAVE A TAX INCREMENT BASE OF ALMOST $30 BILLION CAPTURED VALUE OF JUST OVER 65 MILLION.
THIS NEXT SLIDE, WE'LL WALK THROUGH A CRITERIA RELATED TO RE-INVESTMENT ZONES.
WHAT FINDINGS ARE REQUIRED BY CITY COUNCIL IF CITY COUNCIL SO CHOOSES TO CREATE A
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TAX INCREMENT AND REINVESTMENT ZONE.SO COUNCIL SHOULD FIND THAT THE IMPROVEMENTS WILL SIGNIFICANTLY ENHANCE THE VALUE OF ALL TAXABLE REAL PROPERTY WITHIN THE ZONE, AND WILL BE OF THE GENERAL BENEFIT TO THE CITY.
THE AREA MUST ALSO MEET THE REQUIREMENTS OF SECTION THREE 11.05.
AND SO WE ALSO HAVE A THREE 11.05 EXTROVERTED FOR REFERENCE.
AND SO TO DESIGNATE A RE-INVESTMENT ZONE, THE AREA MUST SUBSTANTIALLY ARREST FOR IN PARIS SOUND GROWTH OF THE MUNICIPALITY, UM, BE A MENACE TO PUBLIC HEALTH, SAFETY, MORALS, OR WELFARE, AND ITS PRESENT CONDITION AND USE BECAUSE OF THE PRESENCE OF, AND WHAT I'VE DONE IN THIS NEXT SLIDE IS UP HIGHLIGHTED THE MOST COMMON CRITERIA THAT ARE USED IN RELATION TO, UM, CREATING TAX INCREMENT REINVESTMENT ZONES.
BUT ANY OF THE CRITERIA LISTED IN, UH, A THROUGH I, UH, WOULD BE SATISFACTORY.
AND SO YOU HAVE A SUBSTANTIAL OR SUBSTANDARD SLUMS, OR SUBSTANDARD SLUM, DETERIORATING, OR DETERIORATED STRUCTURES, A PREDOMINANCE OF DEFECTIVE OR INADEQUATE SIDEWALKS OR STREET LAYOUTS, FAULTY, LOT LAYOUT IN RELATION TO SIZE ADEQUACY, ACCESSIBILITY, OR USEFULNESS, UNSANITARY, OR UNSAFE CONDITIONS, THIS DETERIORATION OF THE SITE, OR OTHER IMPROVEMENTS.
IF YOU HAVE A TAX OR SPECIAL ASSESSMENT OVER THE LAND THAT EXCEEDS THE FAIR VALUE OF THE LAND, DEFECTIVE ARE UNUSUAL TITLE CONDITIONS.
IF THE AREA, UH, POSES IN DANGER TO LIFE OR PROPERTY BY FIRE OR OTHER CAUSE OR STRUCTURES OR OTHER SINGLE FAMILY, RESIDENTIAL STRUCTURE HAS LESS THAN 10% OF THE SQUARE FOOTAGE OF WHICH HAS BEEN USED FOR COMMERCIAL INDUSTRIAL RESIDENTIAL PURPOSES.
DURING THE PRECEDING 12 YEARS, CONTINUING ON THREE 11.05.
IT SHOULD BE PREDOMINANTLY OPENED OR UNDEVELOPED.
AND BECAUSE OF ABSOLUTE AB OBSOLETE PLATTING DETERIORATION OF STRUCTURES OR SITE IMPROVEMENTS OR OTHERS FACTORS SUBSTANTIALLY IMPAIR OR ARRESTS, THE SOUND GROWTH OF THE MUNICIPALITY, IT COULD BE AT A FEDERALLY DECLARED COMMUNITY OR BEING IN AN AREA THAT BY PETITION OF MORE THAN 50% OF THE OWNERS OF VALUE OF THE LAND PETITIONS FOR CREATION OF THE TOURISTS, ALL THOSE ARE OUR CRITERIA CREATION FOR WHAT TYPE OF LAND CAN BE INCLUDED IN THE TAX INCREMENT REINVESTMENT ZONE.
SO DO YOU HAVE A QUESTION? OKAY.
DOES IT HAVE TO BE 1, 2, 3 OR FOUR? SO I GUESS THE WAY I READ THIS IT'S SEMI-COLON AND THEN IT'S TO THE NUMBER THREE AND THEN NUMBER THREE HAS WHORE.
WHEREAS NUMBER ONE IS THE SAME WAY.
IT DOESN'T SAY ORANGE, IT LOOKS LIKE NUMBER ONE AND TWO OR REQUIREMENTS, AND THEN IT COULD BE THREE OR FOUR.
SO IT'S 1, 2, 3, OR FOUR, ANY OF THEM, ONE, ANY OF THEM STAND ALONE AND ANTHONY STANDING ALONE.
SO THEN HOW WOULD, HOW DOES A NUMBER FOUR LOOK LIKE ANYBODY CAN APPLY? YEAH.
CAN YOU, CAN YOU EXPAND A LITTLE BIT ON THE, THE, AT LEAST 50% OF THE PRAISE VALUE OF THE PROPERTY IN THE AREA THAT YOU HAVE A PETITION THAT SIGNED BY LANDOWNERS OF MORE THAN, OR AT LEAST SO MORE THAN 50% OF THE PRAISE VALUE OR PROPERTY WITHIN THE AREA SO MUCH, LIKE YOU RECEIVE A PETITION FOR A PIT, FROM POSITION OF LANDOWNERS WHO ARE RESPONSIBLE FOR 50% OF TAXABLE VALUE WITHIN THE PIT, THIS WOULD BE A PETITION THAT'S SUBMITTED BY AT LEAST 50% OF APPRAISED VALUE WITHIN THE TOURIST.
AND IT STILL HAS TO MEET THE GUIDELINES.
WELL, I WOULD SAY THAT IT WOULD HAVE TO MEET THE CONSTITUTION, ALL THE GUIDELINES OF BEING UNDEVELOPED, UNDERDEVELOPED THEY'RE BLINDED.
AND WE'LL HAVE TO BE MORE, WE'LL HAVE TO MEET A ONE AND BE CORRECT.
WELL, IT'S TWO DIFFERENT ANALYSIS BECAUSE YOU HAVE CONSTITUTIONAL REQUIREMENTS AND THEN YOU HAVE STATUTORY REQUIREMENTS.
AND SO IF YOU WALK THROUGH THE LEGISLATIVE HISTORY SURROUNDING THE STATUTE, THREE 11.005, A WAS THE ORIGINAL STATUTORY PROVISION.
SO BASICALLY THIS IS THE LEGISLATURE TELLING YOU HOW TO DETERMINE WHETHER OR NOT AN AREA IS UNDEVELOPED, UNDERDEVELOPED OR BLIGHTED.
AND THEN OVER TIME, AS STATUTE HAS GOTTEN AMENDED, THEY HAVE DIFFERENT, OR THEY HAVE ADDITIONAL CRITERIA THAT CAN BE USED, UM, FOR THE DESIGNATION
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OF THE ZONE.WHEN YOU GET TO FOUR, BECAUSE FOUR DOESN'T HAVE THAT SAME REQUIREMENT FOR THERE TO BE UNDEVELOPED, UNDEVELOPED, OR BLINDED, THEN YOU HAVE TO FALL BACK TO THE CONSTITUTION TO MAKE SURE THAT YOU'RE STILL CAPTURING THOSE CRITERIA.
EVEN THOUGH THE CRITERIA IS AN A, BECAUSE IF YOU CREATE AN AREA UNDER FOUR, THAT'S NOT UNDEVELOPED UNDERDEVELOPED OR BLINDED, THEN FOUR COULD RUN A FOUL OF THE CONSTITUTION.
SO YOU HAVE TO, YOU HAVE TO ENACT FOUR IN A WAY THAT GIVES THE CONSTITUTION ITS MEANING.
SO YOU'RE NOT DOING A UNCONSTITUTIONAL INTERPRETATION OF THE STATUTE.
SO THE DEFINITION OF DEVELOP WOULD BE NO, UH, INFRASTRUCTURE, UH, WHERE THEIR WATER, WASTEWATER ROADS, ANYTHING LIKE THAT, RIGHT.
IT COULD BE, BUT YOU HAVE DEVELOPED OR UNDERDEVELOPED.
AND SO AGAIN, UNDERDEVELOPED CAN BE A SUBJECTIVE STANDARD, UH, BASED ON WHAT THE DEVELOPMENT OF THAT TRACT IS AND WHAT THE DEVELOPMENT OF, UH, SURROUNDING TRACKS.
SO, AND THE REASON I'M ASKING IS I SAW SOMETHING THE OTHER DAY ON TELEVISION.
IT WAS ABOUT A NEIGHBORHOOD THAT HAD FALLEN IN SHAMBLES AND WAS NOW DETERIORATING.
THERE WAS NOTHING GOING ON AND ONE PERSON TOOK IT ON THEMSELVES TO REDEVELOP THIS AREA.
AND I WAS WONDERING IF THERE WAS A TERRORIST THAT COULD BE IN PLACE THERE TO HELP THEM DO THAT.
CAUSE THEY WERE DOING THAT OUT OF POCKET JUST TO, AND THEY WERE VOLUNTEERS, EVERYTHING.
IT WAS A GREAT STORY, BUT I KEPT THINKING IT WAS TERRORISTS WOULD HELP AN AREA LIKE THAT.
NOW, YOU KNOW, YOU'VE BEEN ON COUNCIL TOO LONG WHEN YOU'RE THINKING THAT YEAH, IT'S POSSIBLE.
I THINK IT'S POSSIBLE THAT A TOURIST COULD BE, COULD BE HELPFUL IN A SITUATION LIKE THAT WITH TOURISTS.
I THINK YOU HAVE TO BE, UH, UM, CAREFUL AND CERTAIN OF THOSE REDEVELOPMENT ASPECTS BECAUSE THEY DO HAVE SOME STATUTORY LIMITATIONS ON THE AMOUNT OF TOURISTS THAT CAN BE USED OR THAT CAN BE GRANTED OVER A RESIDENTIAL AREA.
AND SO, SO LONG AS, I MEAN, THERE'S A DIFFERENT STANDARD.
IF YOU HAVE VACANT LAND, THAT WILL BE A RESIDENTIAL DEVELOPMENT, THEN THAT STATUTORY LIMITATION DOESN'T APPLY.
BUT IF YOU HAVE RESIDENCES ALREADY IN PLACE, THEN YOU WOULDN'T BE SUBJECT TO THOSE LIMITATIONS.
WELL, THIS AREA WAS COMMERCIAL AND VERY LITTLE RESIDENTIAL, BUT IT WAS THAT PART OF THE CITY WAS BEING FORGOTTEN AND JUST GOING AWAY, IT WAS, IT WAS REALLY SAD STORY.
AND I WAS THINKING TO MYSELF, BOY, THESE PEOPLE, THESE RESIDENTS, HIS COMMUNITY ARE TAKING THEMSELVES TO REDO THIS.
I WAS WONDERING IF THERE WAS HELP FOR THEM, BUT UH, YEAH, JUST A GREAT STORY THAT SOMEBODY REPORTED ON.
OH, WELL, YOU KNOW, THE, THE CHALLENGES, CAUSE I IT'S BECAUSE THE WAITERS IS FUNCTIONING AS THEY WORK OFF THE INCREMENT.
SO IF THERE'S A BLIGHTED AREA AND YOU CREATE A TERSE, BUT THERE'S NO PROJECT THAT'S GETTING READY TO DEVELOP, THEN THERE'S NO, THEY ONLY, IT ONLY CREATES VALUE IN THE IMPROVEMENT BETWEEN THE BASE LEVEL THAT YOU SAID, IF, SO THERE'S A BLIGHTED AREA AND YOU SET THAT IF IT DOESN'T IMPROVE, THEN THE TOURIST HAS A $0 BALANCE.
SO THERE HAS TO BE SOME KIND OF LIKE UPWARD PLAN FOR DEVELOPMENT IN ORDER FOR THE INCREMENT TO ACTUALLY CREATE SOME KIND OF VALUE, WHICH IS THE, THAT'S THE REAL, THE REAL TRICK BECAUSE SURE.
AND THAT'S GENERALLY PROVIDED BY EITHER THE LOCAL GOVERNMENT OR PRIVATE DEVELOPER.
UH, IS IT PR I KEEP, I'VE ASKED THIS BEFORE AND I CAN NEVER SEEM TO REMEMBER IS APPRECIATION, UH, CONSIDERED AN INCREASE.
LIKE IF, YOU KNOW, IF, IF YOU HAVE A TERS, UH, OVER AN EXISTING STRUCTURE THAT SETS THE BASELINE AT A MILLION DOLLARS FOR SOME COMMERCIAL PROPERTY, CAUSE THAT'S WHAT IT'S BEING TAXED AT AND NO IMPROVEMENTS WERE MADE TO THE BUILDING, BUT BECAUSE OF MARKET CONDITIONS, IT GOES TO $110 MILLION.
DOES THAT 10 MILLION COUNT AS AN INCREMENT? SO THAT REVENUE OKAY.
UM, THIS, AND AGAIN, LIKE I SAID BEFORE, I THINK WE PUT THE SLIDES TOGETHER ATTEMPTING TO ANSWER A LOT OF THE QUESTIONS THAT HAVE BEEN PRAISED PREVIOUSLY POSED BY COUNSEL.
AND SO I THINK YOU ALL HAVE HAD DISCUSSIONS ABOUT, YOU KNOW, WHO MAKES THE DECISION OR HOW IT'S DECIDED WHEN THERE WILL OR WILL NOT BE A TOURIST.
AND SO THIS IS AN AG OPINION FROM 1999, UH, THE RELEVANT SECTION THAT WE'VE HIGHLIGHTED FOR YOU ALL IS THAT THE TERMINATION OF WHETHER A PARTICULAR AREA SATISFIES THE CRITERIA FOR ONE OF THESE STATUTORY PROVISIONS OR IS OTHERWISE UNPRODUCTIVE UNDERDEVELOPED OR BRENT BLIGHTED WITHIN THE MEANING OF ARTICLE EIGHT, SECTION ONE GP, UH, ACCORDING TO SIMILAR CRITERIA IS FOR THE CITY TO MAKE THE FINDING AND THE FIRST INSTANCE EXERCISING REASONABLE DISCRETION, WHICH IS SUBJECT TO JUDICIAL JUDICIAL REVIEW.
SO THIS IS JUST THE STANDARD WHEN SOMEONE COMES TO THE CITY AND THEY REQUEST CREATION OF THE TOURISTS FOR YOU ALL TO EVALUATE WHETHER OR NOT THE STATUTORY BENCHMARKS HAVE BEEN MET.
[00:30:01]
IT'S REASONABLE DISCRETION BEING MADE IN GOOD FAITH.ARE THERE ANY TRUE CONSEQUENCES FOR CREATING A HERS, UM, THAT DOESN'T NECESSARILY QUALIFY FOR A TERSE, I SUPPOSE, SUBJECT TO JUDICIAL REVIEW.
UM, YOU COULD HAVE SOMEONE CHALLENGED THAT CREATION.
I'M NOT QUITE SURE WHO WOULD HAVE PROPER STANDING TO BRING SUCH A SUIT.
NEXT SLIDE IS JUST FOR BENEFIT OF COUNCIL.
UM, WE CAN WALK THROUGH IT OR NOT, BUT THIS JUST BASICALLY SHOWS, UH, HOW THE INCREMENT IS GENERATED.
YOU HAVE YOUR BASE VALUE, WHICH IS THE MID KIND OF A DOTTED LINE ACROSS, UH, THE YEAR THAT THE TOURIST HAS CREATED.
THAT GETS YOU YOUR BASE VALUE AS ASSESSED VALUE INCREASES OVER THE LIFE OF THE CHURCH, THAT PORTION AND THE UPPER, UH, I GUESS TRIANGLE IS THE TAX INCREMENT.
THOSE WOULD BE THE TAX INCREMENT REVENUES AVAILABLE TO PAY PROJECT COSTS.
WHEN YOU HAVE THE END OF YOUR TOURS, WHEN THE TOURIST TERM ENDS, ALL OF THOSE TAX REVENUES, THEN COME BACK TO THE TAXING ENTITIES AS GENERAL REVENUE.
SO IF THERE'S MONEY IN THE TERSE, YOU'RE SAYING THAT IT GOES BACK AT THE END OF THE TOURS AFTER THE TOURIST ENDS, ALL OF THOSE TEXTS INCREMENTS COME BACK TO THE CITY AS GENERAL REVENUE.
SO IN YOUR, YOUR OPINION, UM, I GUESS WE HAVE TWO KINDS OF, UM, TOURS IN THE CITY.
WE HAVE ONE THAT IS A HUNDRED PERCENT AND THEN A ONE THAT'S NOT, I THINK IT'S 30%.
SO I'M JUST CURIOUS AS TO WHEN WE SHOULD DO ONE WHERE IT ALL STAYS IN THERE.
AND THEN WHEN WE SHOULD DO ONE WHERE YOU PUT LESS MONEY PERCENTAGE WISE INTO THAT TOURS, I THINK COMPLETE DISCRETION OF COUNCIL FOR WHAT THE POLICY OBJECTIVE IS RELATED TO THE TOURISM ITSELF.
THE TYPES OF PROJECTS THAT ARE, UM, COMING ONLINE RELATED TO THE DISTRICT.
WE HAVE SOME CLIENTS THAT LIKE TO DO THE TOURIST FOR A LONGER TIME PERIOD, OTHER SMALLER INCREMENT.
AND THEN SOME OF THEM WILL DO A HUNDRED PERCENT, BUT THEN THEY'LL SET A NOT TO EXCEED AMOUNT.
SO EVEN IF YOUR TOURIST HAS A TERM OF SAY 40 YEARS, IF YOU'VE CONTRIBUTED EVERYTHING, YOU'VE AGREED TO CONTRIBUTE WITHIN YOUR 25, THE TOURISM AUTOMATICALLY TERMINATE.
AND SO REALLY IT'S JUST A CONTRACTUAL AGREEMENT BETWEEN THE CITY AND THE DEVELOPER.
UM, AND THAT'S PART OF THE NEGOTIATIONS.
SO IN THE EVENT WE DO TOURS AS 30%.
UM, AND IT, THAT'S NOT ENOUGH TO COVER THE IMPROVEMENTS IN THERE AND IT GETS PULLED OUT OF THE GENERAL FUND.
UM, IS THERE ANYTHING SAYING THAT THAT GENERAL FUND WOULD PAY BACK THAT TERSE OR THE TERS WOULD PAY BACK THAT GENERAL FUND? SO MAYBE A LITTLE BIT OF ADDITIONAL CLARIFICATION FOR WHAT YOU MEAN BY, UM, THE PROJECT COSTS.
ARE WE ISSUING TOURIST REVENUE, BONDS TO FINANCE PROJECT COSTS OR ARE WE PAYING FOR PROJECTS ON A PAY AS YOU GO BASIS? UM, THAT'S UH, THOSE ARE NOT ANSWERS THAT I KNOW MAYBE.
THAT IS THE APPROPRIATE QUESTION BECAUSE WE HAVE, WE HAVE THREE TERRACES, NONE OF THEM ARE 30% TO OVER 50 AND ONE IS A HUNDRED AND ALL THREE OF THEM HAD, WERE SET UP WITH VERY DIFFERENT FINANCIAL STRATEGIES IN MIND.
AND SO ONE WAS SET UP WITH $0 IN THE TERS AND ALL THE DEBT FOR THE GENERAL FUND AND PAID BACK.
THE OTHER TERMS, NUMBER TWO WAS SET UP EXACTLY THE OPPOSITE WAY, WHERE THE GENERAL THE TERS HAD NO DEBT, UH, AND CREATED VALUE AND THEN WAS ABLE TO OFFSET GENERAL FUND DEBT, UH, THE OTHER WAY.
AND SO, UM, AND IT WAS 50% WITH CITI.
I DON'T PERSONALLY THINK THERE'S A REASON TO CREATE A TERM IF YOU DON'T GET COUNTY SUPPORT BECAUSE A THREE 80 IS EFFECTIVELY A TERRORS, UH, BUT THE COUNTY SUPPORT, UH, ALLOWS FOR YOU TO GET, TO BE MORE CREATIVE IN PULLING DOWN COUNTY RESOURCES FOR PUBLIC IMPROVEMENTS.
SO A THREE 80 IS JUST, UH, A TAX REBATE BACK TO THE DEVELOPER WHERE YOU TELL THE DEVELOPER THEY'RE GOING TO BUILD THE INFRASTRUCTURE, BUT A TERS IS A, UH, LOWERING A, IT'S A CREATING OF AN AMOUNT OF MONEY THAT COMES INTO A SPECIAL FUND THAT WE HAVE CONTROL OVER AND CAN APPLY FUNDS WITHIN THE DISTRICT.
SO IF YOU HAVE A PROJECT YOU WANT TO DO WITHIN UTTERS, YOU CAN, UH, THE CITY CAN PAY FOR IT THROUGH, UH, UH, A LOT OF DIFFERENT IT'S ALL THE SAME, BUT ALL COMES OUT IN THE WASH.
BUT THE THING THAT CHANGES WITH THE TOURS IS THE COUNTY PARTICIPATION BECAUSE IT PULLS COUNTY RESOURCES INTO THOSE PUBLIC, UM, UH, UH, IMPROVEMENTS.
SO FOR EXAMPLE, 16, 26 IS PAID FOR BY HALF COUNTY, UH, DOLLARS.
UM, UH, WHEN THE TOURISTS NUMBER TWO REVENUES THAT ARE COMING IN, WE'RE USING THAT TO REFUND BACK THE PAYMENT OF HERO'S MEMORIAL PARK, WHICH WE PUT THE MONEY FOR UPFRONT, BUT THE
[00:35:01]
MONEY COMING BACK TO PAY FOR THAT IS HALF COUNTY DOLLARS.AND SO THAT'S THE, THAT'S THE STRATEGIC REASON TO SET IT UP, UH, THAT WAY OR TERM NUMBER THREE CAN BE, UH, A WAY OF REBALANCING THE MAXIMUM TAX RATES SO THAT YOU CAN ACHIEVE ANNEXATION, WHICH IS A COMPLETELY DIFFERENT.
SO ALL THREE TERMS IS THAT WE'VE CREATED, WE'RE ALL CREATED FOR THREE VERY DIFFERENT REASONS, BUT THEY WERE ALL CREATED FOR REASONS.
SO THE, THE QUESTION OF, YOU KNOW, IT'S COMPLETELY UP TO US, DOES IT MAKE SENSE? ARE WE DOING SOMETHING FINANCIALLY SMART, UM, IN THE WAY THAT WE SET THEM UP OR ARE WE JUST DOING IT TO DO IT? AND IF THAT'S THE CASE, THEN YEAH, TERS NUMBER ONE IS THE MOST POWERFUL TERMS BECAUSE IT'S A HUNDRED PERCENT, THE COUNTY WON'T EVEN DO THAT ANYMORE.
AND THEY DIDN'T REALIZE IT BACK THEN BECAUSE I'M NOT SAYING THEY DIDN'T REALIZE IT THAT'S THE WRONG WAY TO SAY IT, BUT WHEN IT WAS CREATED, IT WASN'T A BIG PENNY PINCH TO THE COUNTY BECAUSE WE BORROWED $26 MILLION TO BUILD 1626 AND THE TERS WAS GONNA PAY FOR THAT.
BUT IN THE FIRST SEVERAL YEARS THAT, YOU KNOW, WE'VE GOT SOME MULTI-MILLION DOLLAR DEBT SERVICE, ALL OF THAT DEBT SERVICES, CITY DEBT SERVICE, AS THE TOURIST IS BUILDING REVENUES BY BUILDING A HEB AND THE HOME DEPOT AND ALL THIS DEVELOPMENT, THEN THESE REVENUES ARE COMING IN AND THEN NOW THE COUNTY'S HAVING TO PAY ALL THE COUNTY TAXES.
THEY GET COLLECTED THROUGH THEIR ILA.
THEY'RE MAKING MORE AND MORE PAYMENTS.
AND NOW IT'S GETTING REALLY DEVELOPED.
AND THE CA THE COUNTY IS STILL COLLECTING ZERO TAXES FROM IT.
IT IS ALL GOING TO PAY FOR 1626, WHICH IS A ROAD THAT WE BUILT.
AND SO OUR DEBT SERVICE PEOPLE WILL SAY, OH, THIS IS UPSIDE DOWN.
IT'S UPSIDE DOWN, WHICH I'VE CRITICIZED IT FOR BEING UPSIDE DOWN BECAUSE I DIDN'T UNDERSTAND THE WAY IT WAS SET UP OUR DEBT CONTRIBUTION TO PAY FOR THE DEBT SERVICE ON 16, 26 IS GOING DOWN EVERY IT'S THE ONLY ROAD, OUR 2013 ROAD BONDS, ALL THE ROADS THAT WE'RE BUILDING, OUR DEBT SERVICE IS NOT GOING DOWN ON THAT.
THAT'S A HUNDRED PERCENT CITY TAXES, 16, 26, IT'S GETTING BETTER.
EVERY SINGLE WITH EVERY SINGLE PROJECT THAT GETS BUILT, UH, ESSENTIALLY.
AND EVENTUALLY IT WON'T BE, UH, UPSIDE DOWN, BUT THAT DOESN'T MEAN THAT THE COUNTY WON'T HAVE TO CONTINUE TO GIVE 100% OF THE PROCEEDS, UNLESS THERE'S SOMETHING WITHIN THE TERM CREATION ITSELF THAT LIMITS THE COUNTY'S PARTICIPATION TO 50% OF THE DEBT SERVICE, WHICH I'D BE CURIOUS TO KNOW.
I HOPE THAT'S NOT THE CASE BECAUSE EVENTUALLY, YOU KNOW, THERE WAS A BOARD CREATED, THE BOARD IS DEFUNCT.
TERS NUMBER TWO BOARD IS, HAS TO MAKE ALL THE DECISIONS ABOUT THE BUDGET BECAUSE THERE'S ALL THESE MONIES COMING IN AND WE GET TO DECIDE HOW TO SPEND, BUT TERS NUMBER ONE, THEY DON'T THE, I DON'T EVEN THINK THE BOARD, IT DOESN'T MATTER BECAUSE IT'S UPSIDE DOWN AND IT'S PURELY AN INSTRUMENT FOR HELPING US TO FINANCE IT, WHICH MEANT THAT THE CITY TOOK THE MAJORITY OF THE, OF THE BURDEN OF THE DEBT SERVICE EARLY.
AND THE COUNTY IS PARTICIPATING MORE LATE AND OF LATE IN PARTICULAR.
SO TERSE NUMBER ONE IS BECOMING REALLY, REALLY SWEET FOR US.
AND WE'VE, WE'VE HEARD FROM THE COUNTY THAT THEY, UH, ARE FEELING THE PINCH AND WOULD DO NOT EVER WANT TO SET ANYTHING LIKE THAT UP AGAIN.
SO I'VE GONE IN SIX YEARS BECAUSE A LOT HAS HAPPENED IN SIX YEARS FROM THINKING TERMS, NUMBER ONE WAS FAILURE, AND A BIG MISTAKE TO REALIZING THAT IT WAS KIND OF PURE GENIUS.
UM, AND, UH, SO THOSE WERE MY THOUGHTS ON THAT.
YEAH, I'VE KIND OF FELT THE SAME WAY ABOUT TOURISTS.
NUMBER ONE, ESPECIALLY WHEN WAS IN THE AMOUNT OF DOLLARS NOW GOING AT GENERATING, YOU KNOW, THROUGH TEXTS WITH, UH, PEOPLE NOW LIVING IN KYLE NO LONGER A BEDROOM COMMUNITY.
SO I, YOU KNOW, I SEE THOSE TYPE TAX REVENUES COMING IN AND GOING INTO THE TOURS AND I REALLY THOUGHT IT WAS LIKE WE WERE LOSING OUT OF THE CITY, BUT GOOD EXPLANATION.
I GUESS MY QUESTION WOULD, THIS WAS WITH THE CREATION OF TRUST.
NUMBER THREE, I THOUGHT WE WERE GOING TO BE UPSIDE DOWN AND NOTHING WAS COMING TO THE GENERAL AND WE WEREN'T GOING TO BE ISSUING, WANTS TO PAY FOR WHATEVER PROJECTS.
SO WE WERE GOING TO GET THAT UPSIDE DOWN, I GUESS THERE'S THREE DIFFERENT ONES AND THEY'RE DIFFERENT THE WAY THAT THEY HAVE BEEN SET UP.
UM, SO IT SHOULD JUST BE LIKE YOUR PITS, RIGHT? EACH DEVELOPMENT IS A SPECIAL DEVELOPMENT THAT SHOULD BE SEPARATELY NEGOTIATED WHAT YOU DO FOR ONE, YOU DON'T HAVE TO DO FOR A HALL.
UM, WHAT WE SAY MOST OFTEN RIGHT NOW IN OUR FIRM.
AND I THINK WITHIN THE LAST YEAR, ABOUT HALF OF THE PIDS THAT WE'VE DONE HAVE HAD TOURIST OVERLAYS.
AND SO IT IS FAIRLY COMMON FOR THEM TO BE USED IN CONJUNCTION WITH EACH OTHER.
UM, DOING A PID TOURIST OVERLAY PROVIDES A REALLY NICE DEVELOPER INCENTIVE TO ANNEX LEANT INTO CITY LIMITS WHEN THAT'S AVAILABLE, WHEN THE LAND THAT'S PROPOSED TO BE DEVELOPED AS ADJACENT TO CITY LIMITS AND ANNEXATION AS POSSIBLE, YOU ARE GOING TO DO THE PIT
[00:40:01]
AND YOUR ATJ ANYWAY, TICKET THAT DEVELOPMENT AND TO PROVIDE SOME DEVELOPMENT STANDARDS, UH, TO AREA, TO AREAS WITHIN THE CITY'S ATJ, UH, DOING A PID TOURIST OVERLAY CAN PROVIDE A REVENUE NEUTRAL WAY TO GET THAT ANNEXATION IN BECAUSE YOU CAN USE YOUR TOURIST REVENUES AND WHAT THE TOURIST REVENUES ARE GENERALLY USED FOR.NOT ALWAYS GENERALLY WHAT THE TOURIST REVENUES ARE USED FOR IS TO BUY DOWN THAT PIT ASSESSMENT.
AND SO YOUR CHAIR'S REVENUES ARE NOT GOING AS A PAYMENT TO THE DEVELOPER.
YOUR TOURIST REVENUES ARE ACTUALLY GOING BACK TO YOUR ULTIMATE HOMEOWNERS INSTEAD OF PAYING A $1,500 PET ASSESSMENT ON AN ANNUAL BASIS, THEY MAY ONLY HAVE TO PAY A THOUSAND DOLLARS ANNUAL ASSESSMENT BECAUSE $500 THAT THEY PAID IN CITY, AVALARA TAXES IS BEING DEPOSITED WITH THE BOND TRUSTEE TO YOU AND BEING USED TO BUY DOWN THEIR ANNUAL ASSESSMENTS.
AND SO IT'S NOT A BENEFIT TO THE DEVELOPER OR BENEFIT TO THE CITY.
AND IT, IN ANY WAY, WHAT YOU'RE DOING IS YOU'RE JUST LOWERING SOMEONE'S TAX BILL BECAUSE THEY'RE PAYING A LESSER, UM, PET ASSESSMENT, BUT I'VE ALSO, YOU KNOW, I'VE ALSO PARTICIPATED IN FINANCINGS WHERE THE PITS AND TOURISTS HAVE FINANCED TWO COMPLETELY DIFFERENT SETS OF PROJECTS.
SO IT JUST DEPENDS ON AGAIN, WHAT THE DEVELOPMENT IS, WHAT THE NEEDS ARE, HOW MUCH IS BEING FINANCED, WHAT OTHER, UH, FINANCING TOOLS ARE, WHAT THE DEVELOPER'S CAPITAL STACK LOOKS LIKE.
IT'S ALL VERY, UM, YEAH, I WOULD SAY MY IMPRESSION OF TERMS NUMBER THREE WAS NOT THAT IT REALLY PAID DOWN THE PITT ASSESSMENT.
THE, IT WAS JUST THAT THE DEVELOPER'S GOING TO BE ABLE TO ACHIEVE ALL OF THEIR, UM, REVENUE BONDING THROUGH PIDS.
AND THERE WAS NO, AND THEY WERE GOING TO HAVE A BIG PIT BECAUSE THEY DIDN'T HAVE A CITY TAX RATES SO THAT IT WAS GOING TO BE ZERO REVENUE TO THE CITY.
AND WE SAID, LET'S ACHIEVE ANNEXATION.
SO, BUT IF WE ANNEX THEM, THAT'S 50 CENTS, WHICH PUTS THEM COMPLETELY OUT OF THE MARKET AS A, AS IT RELATES TO THEIR MARKET CAP, WHICH MEANS THE PROJECT FAILS.
BUT BY CREATING THE TERS WITH THE ANNEXATION, INSTEAD OF IT BEING 50 CENTS, WE WERE ABLE TO PULL IT DOWN TO 30 CENTS AND ACHIEVE THE ANNEXATION.
SO IT'S THE 20 CENTS IS WHERE.
SO IF IT GOES FROM 50 CENTS DOWN TO 30, THAT 20 CENTS IS WHAT, UH, UH, IS THAT CAN BE SEEN AS A SUBSIDY WHERE WE'RE BASICALLY TAKING WHAT WOULD HAVE BEEN THIS BIG PID, LOWERING IT AND MOVING IT OVER TO THAT 20 CENTS.
BUT THE 30 CENTS IS NOW OURS TO TAKE THAT WOULD NOT HAVE BEEN THERE AT ALL.
SO WHEN WE WERE TALKING ABOUT A MILLION DOLLARS A YEAR IN REVENUE FROM THE TOLL BROTHERS DEAL, THAT IS BECAUSE THAT 30 CENTS, THIS SUBSIDY WAS THE 20 CENTS THAT OFFSET THE PID RATE, BUT THAT 20 CENTS AND THAT 30 CENTS WERE OFF THE TABLE.
SO WHAT, WHAT THEY ALREADY HAD WAS THE SUBSIDY.
THEY ALREADY HAD THE BIG PID, AND WE PUT THE, THE TERMS THAT THE 30 THAT GOES TO US AND THE 20 THAT GOES TO THEM ON THE TABLE IN ORDER TO, IT WAS, IT WAS REALLY AN INCENTIVE TO US, BUT IT WAS ALSO GOOD FOR THEM.
AND SO IT WAS, IT WAS A WIN-WIN AND THAT'S WHY THAT'S WHY ULTIMATELY WORKED OUT.
BUT THERE IS NO, THERE'S NO DEBT THAT'S BEING FOR ANY OF THOSE PROJECTS, THAT'S COMING FROM THE GENERAL FUND.
AND SO THE 30 CENTS THAT THEY WILL GENERATE IN REVENUE COMES UNENCUMBERED ANNUALLY TO THE GENERAL FUND, JUST LIKE A TAXPAYER.
AND THEN WHEN THE TOUR'S IS OVER, THEY HAVE TO PAY FULL TAXES JUST AS HAS BEEN SAID, THE WAY THEY HAD IT SET UP WAS AN OUT OF CITY PID, WHICH MEANT THAT AT THE END OF 25 OR 30 YEARS, THEN YOU WOULD ANNEX THEM AND COLLECT YOUR FIRST PENNY OF PROPERTY TAX IN 25 OR 30 YEARS, ASSUMING YOU CAN ANNEX, BUT STATE LAW HAS CHANGED.
IT SUCH THAT, UH, ANNEXING THEM IS, UH, WOULD BE VERY CHALLENGING AND UNLIKELY TO HAPPEN AT ALL.
JUST MEANS WE NEVER COLLECT A PENNY FROM THEM EVER.
YEAH, I GUESS MY FEAR WITH THAT COMMENT IS, UM, TAX REVENUE IS GREAT, BUT I DON'T THINK THAT'S NECESSARILY QUALIFIES UTTERS IN ANY WAY.
UM, AND SO I'VE HAD SITUATIONS WHERE DEVELOPERS HAVE COME UP TO ME TWICE SINCE AND, AND ASKED FOR TERMS, YOU KNOW, UM, AND PRESENTED.
AND SO MY FEAR IS WE WERE TALKING ABOUT, YOU KNOW, LIABILITY, AND I DON'T KNOW IF A DEVELOPER HAS STANDING TO SUE, BUT, UM, IF WE GIVE THESE TERS TWO SEPARATE FOR SEPARATE REASONS THAT ARE NOT STATUTORILY COVERED, UM, I, MY FEAR IS IT BRINGS A LIABILITY ONTO THE CITY, AND I'M NOT SURE IF A DEVELOPER CAN BRING THAT STANDING, BUT IF WE GIVE IT TO ONE ANOTHER, WHAT IMAGINE A LOT OF DEVELOPER WOULD HAVE STANDING.
AND AS A COUNCIL, WE'VE GOT TO STOP LIVING IN FEAR OF BEING SUED ON THE BASIS OF TERRORS.
BECAUSE IF YOU LOOK AT TERMS NUMBER ONE,
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WHICH WAS CREATED AND THE WAY THAT IT WAS CREATED, NUMBER TWO, NUMBER THREE, BLANCO, UM, BLANCO VISTA, AND THE WAY THAT IT WAS CREATED THE TERMS IN DRIPPING SPRINGS AND ALL OVER GO LOOK AT THE LIST OF EVERY TERM THAT'S CREATED IN THE STATE OF TEXAS.AND THEY'RE ALL CREATED FOR STRATEGIC REASONS TO CREATE ECONOMIC OPPORTUNITY FOR DEVELOPMENT, WHICH IS VERY CONSISTENT WITH ALL OF THE TERMS IS THAT WE'VE CREATED.
PLUS THE TERMS IS THAT WE ARE PROPOSING THAT THIS BOARD HAS SET SHOWN SIGNS THAT THEY WANT TO SUPPORT LIKE TERM NUMBER FOUR ON THE EAST SIDE, ON COLEMAN'S PLACE.
AND POSSIBLY TERS NUMBER FIVE AS WELL.
THERE'S ALMOST, IT'S ALMOST INDISTINGUISHABLE FROM A STATUTORY STANDPOINT BETWEEN THESE DIFFERENT ONES AND, AND ALL THE PRECEDENT THAT HAS BEEN SET SHOULD GIVE US CONFIDENCE TO SO THAT WE'RE NOT AFRAID OF BEING SUED TO ACTUALLY SPEND TIME THINKING, IS THIS A GOOD DEAL? BECAUSE THAT'S WHERE OUR MINDSET NEEDS TO BE.
IS THIS THE RIGHT WAY TO SET THIS UP, TO ACHIEVE THE BEST RESULTS LONG-TERM FOR THE CITY WE CAN MOVE ON, PLEASE? SURE.
BELOW IS A LIST OF JUST SESH PLAY AUTHORIZED TOURIST IMPROVEMENTS.
SO YOU HAVE SIDEWALKS, CROSSWALKS, PEDESTRIAN CROSSINGS, A STORM SEWER DRAINAGE, SANITARY ASSISTS, SANITARY SEWERS, LANDSCAPING, STREETSCAPE, ART, PLAZAS, PEDESTRIAN SQUARES, MALLS, TRAILS, PARKING, LOTS ROADWAYS, A CERTAIN UTILITY LINE WHERE YOUR LOCATIONS AND INSTALLATIONS I'LL SAY CERTAIN BECAUSE IT WOULD HAVE TO BE MUNICIPALLY OWNED TO BE A PUBLIC INFORMATION PUBLIC PROJECT.
SO YOU COULDN'T DO UTILITY LINE RELOCATIONS OR INSTALLATIONS FOR A PRIVATE UTILITY PROVIDER, A WATER SYSTEM IMPROVEMENTS, PARKS, AND OUTDOOR SPACES, AND PRE EVENTS PER 2% TO THREE 80 AGREEMENTS, WHICH IS THE ECONOMIC DEVELOPMENT, UH, BICYCLE ROUTES AND FACILITIES, PUBLIC TRANSPORTATION PROJECTS, SIGNAGES, AND THEN ANY OTHER PUBLIC IMPROVEMENTS RELATED ARE NECESSARY AND CONVENIENT TO THOSE LISTED ABOVE RELATED TO THE TOURIST CREATION.
THE PROCESS GENERALLY TAKES ABOUT THREE MONTHS AND WE'VE OUTLINED STEPS RELATED TO TOURIST CREATION.
THE CITY COUNCIL WOULD ADOPT A RESOLUTE RESOLUTION, ESTABLISHING ITS A TENT TO CREATE THE TOURISTS AND THEN PUBLISH NOTICE OF A PUBLIC HEARING RELATED TO THAT TOURIST CREATION, UH, WORKING GROUP MEMBERS, WHICH GENERALLY WOULD CONSIST OF THE PROPOSED DEVELOPER, THE CITY SPAWNED COUNCIL, THE CITY'S FINANCIAL ADVISOR.
IF THE CITY HAS A TOURIST CONSULTANT WOULD WORK TO CREATE A PRELIMINARY FINANCING PLAN AND A PRELIMINARY PROJECT PLAN, UH, AFTER THE NOTICE HAS PUBLISHED, THE CITY WOULD CONDUCT A PUBLIC HEARING RELATED TO THAT TOURIST IN WHICH THE PRELIMINARY PLANS WOULD BE PRESENTED AFTER THAT PUBLIC HEARING.
UH, IF THAT'S APPROVED, THEN THE CITY CAN ADOPT AN ORDINANCE TO DESIGNATE THE TOURISTS.
AND THEN THE CITY WOULD ALSO CAN ALSO ADOPT THE FINAL FINANCING PLAN AND PROJECT PLAN APPROVED BY BOTH THE TOURIST BOARD AND CITY COUNCIL FOR ANY, UM, PROJECTS TO BE UNDERTAKEN BY THE PLANT BY THE TOURISTS.
THE PROJECT ITSELF HAS TO BE INCLUDED IN THAT PROJECT PLAN AND IN THE FINANCING PLAN, IF IT'S NOT, IT'S NOT A STATUTORY STATUTORILY AUTHORIZED USE TO REVENUES, BUT THE COUNCIL WOULD HAVE DISCRETION TO GO IN TO AMEND THE PLAN AT A FUTURE DATE.
IF IT WANTED TO ADD PROJECTS, UH, STATUTORY OR THE STATUTE SETS FORTH THE REQUIREMENTS OF WHAT SHOULD BE INCLUDED IN THE FINANCING PLAN RELATED TO THE TOURISTS.
AND SO IT SHOULD PROVIDE A DETAILED LIST OF THE ESTIMATED PROJECT COSTS OF THE TOURISTS, INCLUDING ALL ADMINISTRATIVE EXPENSES SHOULD INCLUDE, UH, THE KIND NUMBER AND LOCATION OF ALL PUBLIC WORKS OR PROPOSED PUBLIC WORKS WITHIN THE TOURIST AND ECONOMIC FEASIBILITY STUDY AND ESTIMATED AMOUNT OF BONDED INDEBTEDNESS TO BE INCURRED.
IF THE TOURIST WILL HAVE BONDED INDEBTEDNESS, UH, TIMING ASSOCIATED FOR ANY INCURRING COSTS OR MONETARY OBLIGATIONS.
AND SO IT'S A FIVE-YEAR FINANCING PLAN AND THEN METHODS FOR FINANCING THOSE IMPROVEMENTS.
IF THERE ARE ANY OTHER EXPENSES, EXPECTED SOURCES OF REVENUES AND THE AMOUNT OF TOURIST INCREMENT THAT WILL BE DEDICATED FOR THOSE PUBLIC IMPROVEMENTS, THE FINANCING PLAN WOULD SET FOR THE CURRENT TOTAL TAXABLE ASSESSED VALUE OF TAXABLE PROPERTY WITHIN THE TOURIST THAT PROVIDES THE BASE VALUE FOR YOUR ZONE.
AND THEN IT ALSO HAS WITHIN THE ECONOMIC FEASIBILITY STUDY, IT HAS THE ESTIMATED CAPTURE VALUE OF, UH, THE ASSESSED VALUE WITHIN THE TOURIST FOR EACH YEAR.
AND MUCH OF THE TOURISM IS TO BE IN EXISTENCE.
AND THEN YOU ALSO SET FORTH THE DURATION, UH, FOR ANY POWER'S ALREADY THE QUESTIONS RELATED TO, UH, USING TOURISTS FOR ECONOMIC DEVELOPMENT OR ECONOMIC DEVELOPMENT ACTIVITIES.
[00:50:01]
UM, THREE 11 HAS BEEN AMENDED SO THAT THE TOURIST BOARD AND ULTIMATELY CITY COUNCIL HAS THE AUTHORITY TO MAKE GRANT GRANTS OR LOANS USING MONEY FROM THE TUX AND COMMIT FUND.AND THEN THERE'S A STATUTORY CAP.
UH, THE GRANTS AND LOANS CAN BE MADE IN AN ACCURATE AND AMOUNT NOT TO EXCEED THE AMOUNT OF TAX INCREMENT PRODUCED BY THE MUNICIPALITY AND PAID INTO THE TEXT INCREMENT ZONE.
SO BASICALLY YOU CAN'T AGREE TO PAY MORE THAN WHAT YOU'RE TAKING IN.
AND SO IF YOU MAKE A THREE 80 AGREEMENT FOR EITHER GRANTS OR LOANS TO A DEVELOPER, THAT AGREEMENT WOULD HAVE TO HAVE A CAP SUCH THAT YOU MAY AGREE TO PAY A THOUSAND DOLLARS, BUT IF YOU ONLY CAPTURE A HUNDRED DOLLARS OR $500 OF INCREMENT, THE DEVELOPER WOULD GET THAT $500 AND YOU WOULD HAVE NO LIABILITY TO GO IN AND MAKE HIM WHOLE FOR THE DIFFERENCE BETWEEN WHAT WAS PROJECTED AND WHAT ACTUALLY CAME IN SPECIFIC ISSUES TO CONSIDER RELATED TO THE CHORES.
CHORES CAN BE USED AS A FINANCING TOOL FOR PROPOSED DEVELOPMENTS, TAX INCREMENT FUNDS CAN BE USED INDEPENDENTLY TO FINANCE THOSE.
THEY CAN BE USED, UH, THROUGH TAX INCREMENT REVENUE BONDS.
YOU CAN USE IT AS A DEVELOPER REIMBURSEMENT SO THAT THE DEVELOPER KIND OF LIKE A PAY AS YOU GO PITCH, THE DEVELOPER PUTS IN ALL THE, UM, INFRASTRUCTURE.
AND THEN YOU ENTER INTO AGREEMENT WITH THE DEVELOPER SO THAT YOU PAY TAX INCREMENTS TO PAY FOR THOSE PUBLIC IMPROVEMENTS.
AS THE INCREMENTS ARE REALIZED, YOU CAN DO IT ON PAY AS YOU GO.
SO THE CITY COULD CREATE A TOURIST CAPTURE ALL OF THE REVENUES FOR A SPECIFIC TIME.
UH, WHEN YOU HAVE KIND OF CRITICAL MASS THAT WOULD ALLOW YOU TO UNDERTAKE A PROJECT, THEN YOU CAN GO AND UNDERTAKE THE PROJECT AND DO PAY AS YOU GO.
SO YOU'RE BASICALLY PAYING CONTRACTOR CASH FOR THOSE PROJECTS.
AND THEN, LIKE I SAID BEFORE, WE ALSO SEE TOURIST REVENUES BEEN USED TO BUY DOWN, PUT ASSESSMENTS ALL, OR A PORTION OF THE TAX INCREMENT CAN BE DEDICATED TO THE ZONE.
AND SO THE CITY RETAINS DISCRETION WHEN DETERMINING THE AMOUNT OF TAX INCREMENT, THAT'LL BE DEDICATED.
SO, AS WE SAID BEFORE, YOU CAN DEDICATE A SPECIFIC PERCENTAGE.
YOU CAN SET A, NOT TO EXCEED AMOUNT, OR YOU CAN SET A TIMELINE FOR THE ZONE, OR YOU CAN DO ALL OF THE ABOVE, UH, PERMISSIBLE USES OF AD VALOREM TAXES GENERATED FROM THE FROZEN BAY SHARE VALUE AND THE PORTION OF THE TAX INCREMENT THAT THE CITY RETAINS OUR CITY FUNDS THAT ARE DEPOSITED INTO THE CITY'S GENERAL REVENUE FUND AND CAN BE USED FOR ANY LAWFUL PURPOSE.
AND SO ANYTHING THAT YOU GET, WE CALL IT THE FROZEN VALUE, THE VALUE OF THE LAND, AS OF THE CREATION DATE, ANY TAXES THAT ARE GENERATED FROM THAT PORTION OR CITY REVENUES, IF THE CITY DECIDES TO DEDICATE 50% OF THE TAX INCREMENT GENERATED FROM CAPTURED VALUE, THEN 50% GOES TO THE TOURIST.
50 CENT COMES TO THE 50% COMES TO THE CITY.
AND THE AMOUNT THAT COMES TO THE CITY IS USED AS JUST ANY OTHER, UH, GENERAL CITY FUNDS CAN BE USED.
IF THE CITY ISSUES, BONDS SECURED BY TOURISM REVENUES, TOURIST PROCEEDINGS WILL BE INCLUDED.
AND THE TRANSCRIPT OF PROCEEDINGS THAT GOES TO THE ATTORNEY GENERAL'S OFFICE WHEN THEY REVIEW AND APPROVE THE BONDS, UH, TOURISM IS FOR GENERAL MUNICIPAL SERVICES.
SO IN ADDITION TO, IF YOU DO A SPLIT TOURIST REVENUE WHERE YOU SAY 50% OF THE INCREMENT CAN GO TO THE ZONE, 50% COMES TO THE CITY TO BE USED FOR GENERAL PURPOSE.
AND ADDITION TO THAT, THIS SECTION WITH THREE 11.01, OH, ALLOWS THE CITY TO USE INCREMENTAL, UH, VALUES OR INCREMENTAL REVENUES TO PROVIDE GENERAL MUNICIPAL SERVICES WITHIN THE ZONE.
AND SO THAT'S AN EXTRA BENEFIT.
SO IF YOU HAVE A ZONE AND IT'S WITHIN CITY LIMITS, IF YOU HAVE POLICE FIRE PROTECTION THAT YOU WOULD OTHER WISE PROVIDE FOR IN THE CITY, YOU CAN ACTUALLY USE THAT INCREMENT FROM THE ZONE TO PAY FOR THOSE GENERAL SERVICES.
IN ADDITION TO SPECIFIC TOURISM IMPROVEMENTS THAT ARE GOING TO GO IN TOURISTS VALIDATION, PROBABLY ONE OF THE ONLY KIND OF STATUTORY VALIDATIONS RELATED TO, UH, PUBLIC FINANCE ISSUES.
BUT THERE WAS A PROVISION IN THREE 11 ON THE TAX CODE THAT PROVIDES AS OF THE THIRD DAY ANNIVERSARY DATE OF ANY ACTION OR PROCEEDING TAKEN IN RELATION TO A TOURIST THAT ACT OR PROCEEDING IS DEEMED VALID.
GOING BACK TO SECTION THREE 11 PORT OH ONE ZERO POWERS AND DUTIES OF BOARD DIRECTORS.
UM, MY QUESTION IS, CAN YOU GIVE A BRIEF, UM, BREAKDOWN OF HOW THE BOARD IS ARE CREATED?
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UM, I WAS READING IN THE STATUTE THAT IT LOOKS LIKE THE STATE SENATE AND THE STATE HOUSE ARE SOMEHOW INVOLVED.AND IF THEY'RE NOT, UM, ACTIVE IN IT THAT THEY THEN, UM, PUT SOMEBODY ELSE IN THEIR PLACE.
SO I'D PROBABLY HAVE TO PULL UP THE STATUTE.
I DON'T KNOW IF I CAN DO THAT FROM, I CAN PROVIDE YOU.
BUT THE PAPER, UM, YOU TALKING ABOUT A 50 50 PAYING FOR ATTIC, UH, POLICING IN THAT AREA, HOW WOULD THAT WORK? WOULD THAT CAUSE WE PAY FOR OUR POLICING OUT OF THE GENERAL FUND WHEN WE SET UP OUR BUDGET, UM, HOW WOULD WE INCORPORATE ADDING EXTRA OFFICERS FOR THAT AREA? SO I THINK WHAT YOU COULD DO IS YOU COULD BASICALLY DETERMINE IF THERE'S A RATIO THAT YOU HAVE WITH SO MANY POLICE OFFICERS, UH, BY POPULATION LOOK AT THE POPULATION OF THAT DEFINED AREA TO DETERMINE ABOUT HOW MANY POLICE OFFICERS WOULD BE REQUIRED TO SERVICE THAT AREA.
AND THEN TOURIST REVENUES FOR THAT SPECIFIC AMOUNT OF OFFICERS COULD BE INCLUDED AS A COST OF THE ZONE.
I GUESS, IF WENT IN THAT, THAT QUESTION THERE ROBERT OR MAYOR PRO TEM, MISSOURI, IS WE'RE LOOKING AT, I GUESS, BIGGER CITIES THAT HAVE THEY'RE NEEDING SUBSTATIONS.
UM, LET'S SAY LIKE MAYBE LIKE AN AUSTIN OR SOMETHING LIKE THAT, WHERE MAYBE DESIGNING THAT KIND OF A TERSE WOULD BENEFIT THAT CERTAIN AMOUNT OF SECTION OF THE CITY.
AND THEN MAYBE THAT MONEY WOULD BE USED FOR SOMETHING LIKE THAT, LIKE FOR SUBSTATIONS OR, UH, BUILDINGS OR SOMETHING TO WHERE IT'S DESIGNED FOR THAT AREA.
SO WHAT I'M GETTING FROM IT, WHAT IT SAYS IS THAT YOU COULD ACTUALLY, IF YOU'RE NEEDING EXTRA OFFICERS SAY YOU BUILD SOMETHING, THAT'S GOT 20,000 RESIDENTS AND NOW HOW MANY OFFICERS DO YOU NEED FOR 20,000 PEOPLE YOU COULD NOW GENERATE REVENUE TO PAY FOR THOSE OFFICERS? IS THAT CORRECT? SORRY.
SO THERESE IS HAVE A MAINTENANCE AND OPERATION COMPONENT.
SO LIKE WHAT WE'RE TALKING ABOUT ENTERS NUMBER TWO IS PAYING FOR MAINTENANCE ON THE PARKS, THROUGH TERS MONEY.
IT'S THE SAME THING YOU COULD DO THAT THE QUESTION IS WITH THE COUNTY SUPPORT, UH, OUR PARTICIPATE IN DETERS WHERE WE'RE HIRING CITY OFFICERS THAT THEY'RE PAYING HALF OF.
SO THAT MIGHT NOT BE SOMETHING THEY WOULD BE OKAY WITH AND THEY'RE GOING TO WANT TO BE ON THAT BOARD, BUT A WAY TO DO IT MIGHT BE TO SAY, INSTEAD OF THE OFFICERS WE'RE GOING TO PAY FOR EQUIPMENT OR THE SUBSTATION ITSELF, AND I COULD GET THEM TO AGREE TO DO SOMETHING LIKE THAT.
BUT I THINK IT IS DEFINITELY LEGAL IT'S JUST WITH THE COUNTY.
AND I MEAN, I THINK RELATED TO THE COUNTY, I MEAN, YOU CAN ALSO LOOK AT THE TYPES OF PROJECTS THAT WOULD BE BOTH CITY AND COUNTY PROJECTS, RIGHT.
AND THEN TAILOR THE COUNTIES INCREMENT SO THAT THEY'RE PAYING A PORTION OF THOSE PROJECTS THAT THEY WOULD OTHERWISE FINANCE.
INSTEAD IT MAY BE THAT YOU CAN SAY THEIR, THEIR TAX INCREMENTS ARE USED FOR ROADS ARE OTHER KIND OF PUBLIC FACILITIES THAT THEY WOULD HAVE TO ISSUE COUNTY BONDS, UM, TO PROVIDE FOR IT.
AND THAT'S COMING THROUGH THE TOURIST.
AND SO THAT MAY MAKE THE TOURISTS A LITTLE BIT MORE PALATABLE TO THEM.
SO IT LOOKS LIKE SECTION THREE 11 PORNO NINE ONE.
CAUSE I THINK, UM, WE ARE A POPULATION OF ONE POINT LESS THAN 1.8, UM, IN BOTH OF THREE 11.09 AND 0 0 9 1.
THEY BOTH HAVE THE SAME SPOT, THE SAME REQUIREMENTS AS FAR AS BOARD MEMBERS.
SO, UM, I DON'T THINK IT MATTERS WHICH ONE YOU READ.
UM, BUT IT LOOKS LIKE THAT, UM, THE STATE SENATOR AND THE STATE REPRESENTATIVE, AND THEY HAVE THE ABILITY TO WAIVE THEIR SERVICE ON BOARD, BUT THEN THEY HAVE TO APPOINT SOMEBODY ELSE.
UM, AND SO I'M REALLY INTERESTED TO LEARN, UM, WHAT IS, UH, WHAT THE SPORT IS SUPPOSED TO LOOK LIKE.
UM, BECAUSE I THINK IF THE COUNTY PARTICIPATES, THEY'RE ALLOWED AS WELL TO HAVE SOMEBODY ON THAT BOARD, REGARDLESS OF, UM, REGARDLESS OF WHO WANTS THEM ON THERE.
UM, SO CAN YOU, DO YOU KNOW ENOUGH TO GIVE A BRIEF EXPLANATION OF THE BOARD AND ITS CREATIONS AND THEIR MEMBERS? SO THE BOARD IS GENERALLY, UM, OR THE BOARD GENERALLY CONSISTS OF PEOPLE THAT ARE APPOINTED TO THE BOARD.
UM, IT COULD BE THE COUNCIL ITSELF, OR IT COULD BE, YOU KNOW, CITIZENS THAT HAVE AGREED TO SERVE ON THE BOARD, UM, IN A PARTICIPATING UNIT.
SO ANY LOCAL GOVERNMENT THAT PARTICIPATES IN THE TOURS HAS THE ABILITY TO APPOINT A BOARD MEMBER.
AND SO IF YOU HAVE COUNTY PARTICIPATION, YOU CAN HAVE JUNIOR COLLEGE DISTRICT PARTICIPATION.
IF YOU HAVE SPECIAL DISTRICTS WITHIN THE AREA, THEY CAN PARTICIPATE.
UM, SCHOOL DISTRICTS GENERALLY WILL NOT PARTICIPATE IN THREE 11.
UM, BECAUSE UNLIKE CITIZEN COUNTIES, LIKE WHEN YOU CREATE A TOURIST AND YOU PARTICIPATE THE AMOUNT OF YOUR CAPTURED VALUE,
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DOESN'T GO ONTO YOUR TAX ROLE, RIGHT? SO THAT MONEY IS HELD BACK.SO WHEN YOU CALCULATE YOUR TOTAL TAX RATE EACH YEAR AND YOU GET YOUR TAXABLE ASSESSED VALUE, THERE'S A LINE ITEM ON THE COMPTROLLER'S WORKSHEET THAT BACKS OUT THAT CAPTURED VALUE WITHIN THE TOURIST.
AND SO AS YOU'RE CALCULATING YOUR TAX RATE AND OTHER STATUTORY LIMITS, THAT AMOUNTS SET ASIDE, THAT'S NOT THE CASE FOR SCHOOL DISTRICTS.
WHEN SCHOOL DISTRICTS SET THEIR TAX RATE, IF THEY PARTICIPATE IN A TOURIST, THEY DON'T GET TO OFFSET THAT INCREMENTAL VALUE.
AND THE STATE WILL LOOK AT AS IF THEY'RE LOVING AN APPLE WHERE I'M TAXED ON THAT AMOUNT AND ITS ENTIRETY.
AND THAT CREATES CHAPTER 49 PROBLEMS FOR SCHOOL DISTRICTS.
AND THE AMOUNT OF MONEY THAT THEY HAVE TO REBATE TO THE STATE BECAUSE THEY MAY ACTUALLY HAVE TO PAY FROM MONIES THAT THEY HAVEN'T OTHERWISE COLLECTED BECAUSE OF THE TOURISTS, BECAUSE THE MONEY HAS BEEN REDIRECTED.
SO SCHOOL DISTRICTS GENERALLY WILL NOT PARTICIPATE.
UM, AND THREE 11 AGREEMENTS OR, OR, AND TOURISM IS, OR IF THEY DO, IT'S KIND OF A TACIT PARTICIPATION, UM, OR THEY MAY MAKE AN END COTTON CONTRIBUTION, BUT THEY'RE NOT ACTUALLY, UH, PROVIDING INCREMENTS OR FOR OTHER LOCAL GOVERNMENTS THAT PARTICIPATE IN YOUR TOURISTS.
THEY DO HAVE THE ABILITY TO POINT, UM, A BOARD MEMBER, I GUESS.
I, I, I'M TRYING REALLY HARD TO GET CLARIFICATION ON THE BOARD MEMBERS AND WHETHER OR NOT A STATE REPRESENTATIVE, UH, NEEDS TO BE INVOLVED.
SO I THINK, LIKE YOU SAID, THAT WAS A STATUTORY REQUIREMENT THAT YOU COULD HAVE A STATE SENATOR OR STATE REPRESENTATIVE ON THE BOARD.
THEY CAN WAIVE THEIR SERVICE OR THEY CAN OTHERWISE APPOINT A DESIGNATE.
SO HOW DOES THAT WORK? DO, DOES THE CITY REACH OUT TO THE SENATOR AND THE REPRESENTATIVE AND THEN DO THEY DECLINE? AND BECAUSE IT SAYS THEY HAVE TO DO IT NO LATER THAN THE 90TH DAY AFTER THE DATE AND MEMBER OF THE STATE SENATOR OR STATE HOUSE REPRESENTATIVE, UM, IS ELECTED TO THE STATE SENATE.
SO I GUESS THEY'RE THERE THEY'RE ON A TIME LIMIT.
AND DOES THAT MEAN THE CITY IS ON A TIME LIMIT TO MAKE SURE THAT THEY HAVE SOMEBODY ON THE BOARD WHO'S REPRESENTATIVE? WELL, I THINK IF YOU HAVE AN INTEREST IN CREATING A TOURIST, THE FIRST POINT OF CONTACT WOULD BE TO YOUR SENATOR AND YOUR REPRESENTATIVE TO TALK WITH THEM, THE STATUTORY PROVISION TO DETERMINE WHETHER OR NOT THEY WOULD WANT TO SERVE ON THE BOARD IF THEY DIDN'T WANT TO SERVE ON THE BOARD, IF THEY WOULD WAIVE THAT SERVICE, OR IF THEY HAD SOMEONE FROM THEIR STAFF THAT THEY WANT TO APPOINT TO THE BOARD.
SO THIS NEXT SLIDE JUST KIND OF TALKS ABOUT THE PID TOURIST OVERLAY.
UM, AND I THINK A LOT OF THIS INFORMATION WE'VE ALREADY ALREADY COVERED.
I'M HAPPY TO COVER IT AGAIN, BUT YOU KNOW, JUST GENERALLY WHEN YOU HAVE A PIT TOURIST OVERLAY, THOSE TWO FINANCING TOOLS CAN EITHER BE USED INDEPENDENT OF EACH OTHER.
SO YOU WILL HAVE CERTAIN PIT FINANCE PROJECTS AND YOU HAVE CERTAIN TOURIST FINANCE PROJECTS, OR THEY CAN BE USED IN CONJUNCTION WITH EACH OTHER SO THAT YOUR TOURISM ASSESSMENTS ARE ACTUALLY BUYING DOWN THE PIT ASSESSMENTS THAT ARE ULTIMATELY BEING PAID BY TAXPAYERS WITHIN THE CITY.
SO WITH THAT, I'M HAPPY TO ANSWER ANY ADDITIONAL QUESTIONS.
I DON'T HAVE A QUESTION, BUT I JUST WANT TO SAY THANK YOU FOR TAKING UP YOUR TIME TO COME OUT AND, UM, GIVING US THIS PRESENTATION AND ANSWERING A LOT OF OUR QUESTIONS.
UM, I DIDN'T KNOW WHAT TO EXPECT, BUT YEAH, I DEFINITELY ENJOYED IT AND LEARNED A LITTLE BIT AS WELL.
WHAT MAYOR PRETEND SOME, I SAY THAT A LOT MORE CLEAR, UM, JUST FOR FUTURE FITTERS AND JUST TOURISTS ALONE.
UM, SO I APPRECIATE YOUR, YOUR TIME WITH US.