Ord 2020-046/amending the project plan and reinvestment zone financing plan for Tax Increment Reinvestment Zone No. 5, also known as the “Downtown TIRZ,” generally bounded by Concho Street, Moore Street, North Street, Comanche Street, Shady Lane, Frederic

Home Browse Search

Final Draft O429.202O The TIRZ Concept Generally A tax increment reinvestment zone ("TIRZ") is a financing tool created by the State Legislature to assist cities and counties indeveloping orredeveloping unproductive, underdeveloped orblighted areas. Cities may create a TIRZ where conditions exist that substantially impair an area's sound growth and where development o[enhancements financed bythe T|RZsignificantly enhance the value ofall the taxable real property inaT|RZand ofgeneral benefit tothe city orcounty. Prior tocreation, the statute requires preparation ofapreliminary project p|anandreinvestnoent zone financing plan outlining specific projects toaddresstheexistingconditinnsondthennethndond means tofinance those projects. Upon creation, the total appraised value of real property located in a TIRZ is established for the year in which it was created. This is known as the base value. As new development occurs in aT|RZ,the value ofreal property increases. This additional value above the base value isknown asthe tax increment. Such tax increment is typically set aside to finance improvements within a TIRZ including public infrastructure. Once all projects are complete or after a defined period of time, a TIRZ is dissolved. During the life of a TIRZ, a city and other participating taxing jurisdictions collect tax revenue on the base value of a TIRZ as well as sales and use tax revenue generated by new development (unless a city or county agrees that sales tax and use revenue are also part of the increment). When a TIRZ is dissolved, a city and other participating taxing jurisdictions collect tax revenue on the tax increment value created bynew development aawell. � � � New Post -Project AV Total AVnow belongs mall mdnA districts in project area Tenmmxmu Citv of San Marcos Zone No. 5 Project Plan and Financing Plan 3