We would like to thank the Tom Tresser and the TIF Illumination Project of the Civic Lab for all their hard work and allowing us to use their articles and videos to educate Houston on TIF’s
“In 2014 alone, TIRZ’s collected $135.9 million in property taxes. Plenty of that money goes to support worthwhile projects, but those projects only exist within the boundaries of the districts. Meanwhile, drivers all across Houston have to navigate roads that look like they’re modeled from NASA’s new pictures of Pluto.”
http://www.chron.com/opinion/editorials/article/Fighting-inequity-6400511.php
Background on TIF:
Tax increment financing programs go back to 1952, when California became the first state to raise matching funds for federal urban development grants. Today, TIFs (Texas is the only state that calls its tax increment program a TIRZ) are a nationwide trend because of diminished federal financing for infrastructure. Aside from Arizona, every U.S. state has used the financing method that relies upon anticipated increases of property-tax revenues.
http://www.houstonpress.com/news/how-houston-uses-the-tirz-system-to-benefit-high-dollar-areas-and-ignore-poorer-neighborhoods-7497253
What is Tax-Increment Financing?
Tax-Increment Financing (TIFs) is used by City Council to attract new investment to an area. TIFs help finance the cost of redevelopment and encourage development in an area that would otherwise not attract sufficient market development in a timely manner. Taxes attributable to new improvements (tax increments) are set-aside in a fund to finance public improvements within the boundaries of the zone.
http://www.houstontx.gov/ecodev/TIRZ
Problems:
- TIRZ are being used as a way to avoid Houston’s bureaucratic Revenue Cap
- There is no accountability for TIRZ board of directors
- Board of directors are not officially public officials so they are not held accountable to those within their district
- Board of directors have eminent domain powers
- Board of directors may issue bonds with little oversight by the city, county or state
- The criteria to creating a TIRZ is too vague, with no oversight or accountability
Solutions:
- Pass constitutional amendment requiring all TIRZ be terminated at 10 years.
- All bonds, projects and taxes but be finished by the end of the 10th year of operation
- Restrict how much of the city can be within a TIF district
- If the TIRZ surplus is not spent after 5, it automatically goes back to the general fund
Texas Constitution
Code – Tax Code
Chapter – 311 Tax Increment Financing Act
Section – 311.003 Procedure for Creating Reinvestment Zone
Section – 311.009 Composition of Board of Directors
Section – 311.010 Powers and Duties of Board of Directors
Section – 311.005 Criteria for Reinvestment Zone
Tax Increment Zones (TIRZ) Expansions Designed to Beat Revenue Cap
US PIRG – Tax-Increment Financing: The Need for Increased Transparency and Accountability
Is Tax Increment Financing Racist? The Racially Disparate Impact in Chicago’s TIF Spending
Huntsville City Council votes unanimously to repeal TIRZ No. 1
Sealy’s lone TIRZ may fall short
Kansas city to consider terminating tax increment financing district
North Dakota Supreme Court upholds Bismarck’s tax increment financing plan
Bismarck Radisson Pays N0 to Schools and Parks
U.S. Supreme Court – Back Seizure of Property for Development 5-4
Del Rio TIRZ ordinance repeal to be considered
Midland Downtown revitalization without the TIRZ
Midland Residents Not Happy After City Council Votes to Get Rid Of TIRZ After Next Fiscal Year
Business Journal – Houston Taxpayer Money Being Misused Critics Say
US PIRG – Shining a Light on Tax Increment Financing in Chicago
City Council Moves Away from Downtown TIRZ Idea, But Closer to Lone Star Rail Plan
Protecting Low Income Residents During Tax-Increment Financing
Tax Increment Financing: Tweaking TIF for the 21st Century
Business Journal – Turmoil in the summer of TIF
Houston Chronicle – TIF zones remove too much power from elected officials in Houston.
Is HISD getting short end of local TIF carrot?
CATO – Crony Capitalism and Social Engineering: The Case against TIF
Center for American Progress – Raise Needed Revenue Efficiently and Fairly
Daily Kos – California, Birthplace of TIF, Axes It
Business Journal – As California’s TIF goes, so might Colorado’s
Brookings – Tax Increment Financing in the Kansas City and St. Louis Metropolitan Areas
Tax Increment Financing Raises Costs, Hides Giveaways to Politically Connected
Spring Branch TIRZ proposal gets pulled at the last minute
65 The Most Popular Tool: Tax Increment Financing and the Political Economy of Local Government
Factors that Influence the Size of Tax Increment Financing Districts in Texas
Three Chicago companies give back $34 million in tax breaks
Tax Increment Financing Race to the Bottom hurts our Environment
Mayoral Candidates Attack Status Quo at Green Party Forum
Denver Green Party – Responses to our 2015 Municipal Candidate Questionnaire
Green Jobs: Economic Development, Environmental Protection, and Workers’ Rights
Sierra Club – A Dilemma – Who Should Pay for Improving Water Quality?
Galveston City Council votes 5-1 to start closing TIRZ 11
Huntsville City Council votes unanimously to repeal TIRZ No. 1
Midland Downtown revitalization without the TIRZ
Houston Chronicle – Shed some light on TIRZ project
Houston Chronicle – Galveston development project shrouded in secrecy despite public investment
AEI – The growing trend of public redevelopment has increased cronyism, land confiscation, and waste
Mayor Rahm tries and fails to tell the truth about TIFs and taxes
CBS – Activist Protest TIF Funds For Planned Uptown High-Rise Development
Baltimore WYPR Radio – TIFs: The primer
Baltimore WYPR – To TIF or Not to TIF
Baltimore WYPR – Accountability Index: The Mega-TIF Fueling The Port Covington Development
City Paper – Op-Alt: Embracing the TIF With a Twist
USA Today – City may overhaul tax incentives with new report
Knoxville Focus – City adds third-party review to Tax-Increment Financing process
The Atlantic – New Balance Bought Its Own Commuter Rail Station
Chicago Magazine – Is Chicago Really Broke?
Chicago Magazine – Five Ways to Fix Chicago’s TIF Mess