By LYNETTE SOWELL-STEVENS
Cove Leader-Press
On Tuesday evening, the Copperas Cove city council held a public hearing voted to create a tax incremental reinvestment zone, also known as a TIRZ.
The decision was not unanimous with a 4-2 vote by the council.
Councilmembers Christina Strohfus, Rita Hogan, Howard Hawk, and Dale Treadway voted in favor of creating the TIRZ, with councilmembers John Hale and Jack Smith voting against it. Councilmember Vonya Hart was absent from the meeting.
As with the prior discussions on the creation of the TIRZ, Smith expressed concerns regarding the size of the TIRZ – a little more than 2,500 acres. He did so prior to Tuesday’s vote.
“I'm for a TIRZ, but I feel like the same thing I said last time. This is too much land and too many different properties involved, and I think that some of these areas are already going to develop without a TIRZ,” Smith said. “For instance, the land where the VA (clinic) is going is in this TIRZ, and we are going to be getting the taxes from there, and now we're going to turn them over to a TIRZ board…of course, we can appoint the members of the TIRZ board, but also Coryell County and Lampasas County get to appoint members too. Instead of having the money for operations and the general fund, it's going to go to a fund to increase infrastructure for these areas.
“Already three of the properties that I can identify just from the map are already being developed, and we would already be receiving tax money from within a year.”
City Manager Ryan Haverlah addressed Smith’s comment.
“In terms of specifically the VA clinic facility, we did talk about that previously in a meeting where the document and the incentive 380 Agreement that city council has approved can be assigned to the local government corporation, which will fall under the TIRZ, so that means specifically the TIRZ is actually paying the incentives for that development, which comes from the incremental growth of that development as well,” Haverlah said. “It does not address all of your concerns you have with operations, but very specifically, a lot of the growth in our tax rate is a result of those capital projects. Where we're issuing debt, which has a tax rate implication on it, instead of having to issue that debt and pay interest on it, the TIRZ can actually finance a lot of those improvements, so that it does not impact the property tax rate in a way that is causing the rate to increase or grow because of those projects. Again, it's just a tool.”
A TIRZ in Texas is a designated geographic area that is intended to attract new investment and help improvements in that area. A TIRZ creates a fund from property taxes collected within that zone to pay for things like public infrastructure improvements such as roads, utilities, and parks, in that property area. The TIRZ is not a “new tax” but a way for cities to target improvements in specific areas.
The Copperas Cove TIRZ area consists of a total of 2,583.3 acres, located in the City of Copperas Cove and some within the extra territorial jurisdiction of the City of Copperas Cove. There are 20 parcels of land altogether, with 14 along commercial corridors such as Business 190, and five residential parcels, and one industrial parcel.
Bill Calderon with Calderon Economic Strategies, LLC was consulted by the City administration on the creation of a TIRZ and was present at the public hearing to provide more information.
With this TIRZ, taxable value of property in the TIRZ is considered the base year value. As time goes on and the TIRZ property value rises, which means that tax revenue also rises within the TIRZ. The “increment” taxes above the original base value are put into a fund for the zone to pay for the improvements as the area is developed.
The TIRZ can be used to negotiate with residential developers for a myriad of things that they may not otherwise do, enhanced landscaping, enhanced green spaces, and public facilities.
The TIRZ will have a board of directors appointed to include seven members, five from the city and one each from Coryell and Lampasas Counties.
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