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HomeMy WebLinkAbout2010/05/04-Minutes-HEDCCITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE MAY 4, 2010 Present: Committee Member Jungus Jordan, Chairman Committee Member Carter Burdette, Vice Chairman Committee Member Mike Moncrief Committee Member Salvador Espino Committee Member W. B. "Zim" Zimmerman Committee Member Danny Scarth (arrived at 1:04 p.m.) Committee Member Frank Moss Committee Member Kathleen Hicks Committee Member Joel Burns (arrived at 1:05 p.m.) City Staff: Tom Higgins, Assistant City Manager Peter Vaky, Assistant City Attorney Marty Hendrix, City Secretary Jay Chapa, Director of Housing and Economic Development Department Robert Sturns, Manager, Housing and Economic Development Department Other City Staff in Attendance: Cynthia Garcia, Assistant Director, Housing and Economic Development Department Henry Day, Senior Management Analyst, Housing and Economic Development Department Dolores Garza, Community Development Coordinator, Housing and Economic Development Department Karen Meunier, Program Manager, Housing and Economic Development Department Mark Folden, Business Development Coordinator, Housing and Economic Development Department Vicki Ganske, Senior Assistant City Attorney, Legal Department LeAnn Guzman, Assistant City Attorney With a quorum of the committee members present, Chairman Jungus Jordan called the meeting of the Housing and Economic Committee to order at 1:02 p.m., on Tuesday, May 4, 2010, in the Pre - Council Chamber of the Fort Worth Municipal Building, 1000 Throckmorton, Fort Worth, Texas 76102. CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 2 of 20 Approval of Minutes of the April 6, 2010, Housing and Economic Development Committee (Agenda Item 2) Chairman Jordan opened the floor for a motion on the approval of the minutes. MOTION: Upon a motion made by Committee Member Moncrief and seconded by Committee Member Espino, the Committee Members voted seven (7) "ayes" and zero (0) "nays ", with Committee Members Burns and Scarth temporarily absent, to approve the minutes of the April 6, 2010, Housing and Economic Development Committee meeting. The motion carried unanimously. Chairman Jordan adjourned the called — special meeting of the Housing and Economic Development Committee into Executive Session at 1:02 p.m. in accordance with the requirements of the Texas Open Meeting Act. Executive Session (Agenda Item 3) Chairman Jordan called to order the Executive Session at 1:02 p.m. in order to discuss the following items: A. Seek the advice of its attorneys concerning the following items that are exempt from public disclosure under Article X, Section 9 of the Texas State Bar Rules, as authorized by Section 551.071 of the Texas Government Code: (i) legal issues related to any current agenda items; (ii) legal issues related to the use of Neighborhood Stabilization Program funds; and (Committee Members Scarth and Burns arrived at the meeting.) B. Discuss the purchase, sale, lease or value of real property, as authorized by Section 551.072 of the Texas Government Code. Deliberation in an open meeting would have a detrimental effect on the position of the City in negotiations with a third party; and, C. Discuss or deliberate negotiations relating to any economic development negotiations, as authorized by Section 551.087 of the Texas Government Code. Chairman Jordan adjourned the Executive Session at 1:20 p.m. CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 3 of 20 Chairman Jordan reconvened the called — special session of the Housing and Economic Development Committee at 1:20 p.m. Written Reports (Agenda Item 4) Chairman Jordan advised that the committee members had been provided with the following reports: A. Neighborhood Stabilization Program Memo B. Public Improvement Districts Mid -Year Budget Revisions Memo C. Update on Federal Funds Custodial Account These reports were received as a matter of information. There was no discussion on this agenda item. Presentation on Proposed Tax Abatement Agreement with Aliens, Inc., for Former Ranch Style Beans Facility on U.S. Highway 287 (Agenda Item 5) Mr. Robert Sturns, Manager, Housing and Economic Development Department, spoke before the committee on the proposed tax abatement agreement with Allens, Inc., for the use of the former Ranch Style Beans facility on U. S. Highway 287. Using a PowerPoint presentation, Mr. Sturns showed an aerial view of the location of the Ranch Style Beans facility off of U.S. Highway 287. He provided another aerial view of the buildings that were part of this facility. Mr. Sturns advised that Allens, Inc., a privately -owned company, was: • Founded in 1926, remained a family -owned and operated business and was the largest privately owned vegetable company in the United States. • Allens produced a full line of canned and frozen vegetables and beans. • Brands included Allens; Butterfield, East Texas Fair, Freshlike, Popeye and Tappey's. CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 4 of 20 Presentation on Proposed Tax Abatement Agreement with Allens, Inc., for Former Ranch Style Beans Facility on U.S. Highway 287 (cont'd) (Agenda Item 5) • Primary customers were United States companies in the retail food, food service, and food - manufacturing sectors. • Their annual sales were $419.3 million (2008 figure). • Employees: 2000. Mr. Sturns advised that Allens Inc., commitments for the tax abatement agreement were: ■ Invest $4.7 million in real and business personal property investment by December 31, 2010 - Minimum of 20% of real property investment with Fort Worth MWBE firms ■ Commitment to hiring Fort Worth and Fort Worth MWBE firms - Greater of 50% or $250,000 or discretionary service and supply expenditures will be done by Fort Worth MWBE firms. ■ Commitment to hiring Fort Worth and Fort Central City residents. - Creation of a minimum of 110 new jobs. - Minimum of 60% of new FTEs were Fort Worth residents. - Minimum 25% of new FTE's were Fort Worth Central City residents. ■ Invest a minimum of $20,000 in exterior facade improvements /landscaping. Mr. Sturns spoke before the committee members on the proposed incentive terms as follows: PROPOSED INCENTIVE TERMS • Ten year abatement on up to 60% of incremental new value based on real and business personal property investment Potential Maximum Company Commitment Abatement Real & Business Personal Property Investment 25 00 CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 5 of 20 Presentation on Proposed Tax Abatement Agreement with Allens, Inc., for Former Ranch Style Beans Facility on U.S. Highway 287 (cont'd) FW MWBE Contracting Exterior Improvements Overall Employment Employment of Fort Worth Residents Employment of FW Central City Residents TOTAL 5% 10% 10% 5% 5% 60% (Agenda Item 5) • Failure to meet investment deadlines results in default • Failure to meet employment thresholds results in loss of the percentage abatement for that year Mr. Sturns presented the tax projections as follows: Tax Projections Maximum Abatement is 60% Total Taxes Taxes Abated Taxes Paid Real Property $112,344 $ 67,406 $ 44,938 Business Personal Property* $175,660 $105,396 $ 70,264 Total $288,004 $172,802 $115,202 PV in 10 years (6 %) $217,629 $130,578 $ 87,052 *Assumes 10 year useful life Maintain existing RP revenue of $23,000 annually Mr. Sturns spoke before the committee on the development summary as follows: ■ Private Investment - $4.7 million by December 31, 2010 ■ Employment - Minimum 110 FTE ■ Maximum Public Investment $130,578 PV - Ratio (Private: Max. Public) 36:1 Percent City Participation 2.80o CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 6 of 20 Presentation on Proposed Tax Abatement Agreement with Allens, Inc., for Former Ranch Style Beans Facility on U.S. Highway 287 (cont'd) ■ PV of Added Property Tax Revenue $87,052 Mr. Sturns provided the next step in the process as follows: (Agenda Item 5) ■ Mayor and Council Communication and Resolution to hold public hearing and authorize staff to execute contract scheduled for May 18, 2010. Mr. Sturns concluded his presentation. Chairman Jordan opened the floor for discussion and /or comments. Committee Member Hicks advised of her excitement for this project. She pointed out that she could really tell that Robert Sturns was back working for the City by looking at this project. She advised that she was glad to have him back at the City working on these types of deals. She pointed out that in this down economy; the City was seeing some development or redevelopment. She added to see this project come forward was phenomenal for the City of Fort Worth as everyone saw the other cities surrounding the City struggling. She spoke about the number of employees that would be part of this project and that they were to be from the City of Fort Worth and a certain amount from the Central City. She indicated that she was very concerned about this building being left empty as it sat at one of the gateways to the City of Fort Worth. She pointed out that it was an iconic building. She added that it was really exciting that the building would be reused in this positive manner. Committee Member Hicks reiterated that it was really exciting for District 8, the Council District that she represented as well as the entire City. She expressed appreciation to the City staff and for Allens, Inc., for their work in this endeavor. She indicated that she felt it was going to be a wonderful partnership. She added that she looked forward to them being on the ground very soon in order to create more jobs. Chairman Jordan requested clarification on the date the company was to start their operations. Mr. Sturris responded that they had indicated that they wanted to start operations in the month of June. He added that they had a very aggressive time table. He indicated that they already had a hiring manager in place and they were hoping to begin the hiring process in the next couple of weeks. Chairman Jordan added that he thought that they were pretty aggressive as he had already seen their food products and full lines in Albertson's Grocery Stores and CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 7 of 20 Presentation on Proposed Tax Abatement Agreement with Aliens, Inc., for Former Ranch Style Beans Facility on U.S. Highway 287 (cont'd) (Agenda Item 5) pointed out that it usually took a grocery chain some time to move forward in a change in their product lines. Committee Member Moncrief requested clarification from Committee Member Hicks as to whether this new company understood their role as new neighbors with some of the City's homeless population and in Fort Worth it was not "out of sight" "out of mind." Committee Member Hicks indicated that she felt that was a really important aspect. She added that she was recently with the City's Homelessness Coordinator Otis Thornton in the Handley Neighborhood and they had talked about not only was the City trying to address the quality affordable housing issue for the homeless but to also find them jobs in the community. She added that she so wanted to talk about this as this business was right there in that community. Committee Member Hicks indicated that she had also talked with the Police Department's Neighborhood Police Officer for the East Lancaster area and he was very concerned about this vacant building. She pointed out that Ranch Style Beans, the former owner, had continued to have security at this location. Committee Member Hicks added that she felt they should continue to talk about this issue in a larger way in that area and how that not only the City of Fort Worth was concerned about addressing issues in this area but there were other partners in the community that were concerned about this area of the City. She recommended to the City staff that the next time the Allens, Inc., business people were in the community that a meeting be set to bring them up -to- date on what was occurring in this area of the City along East Lancaster and the hiring of people from the Central City area. Committee Member Moncrief interjected that he felt this business would also help the portion of "The T" that had recently moved some of their facilities to this area. He added that the one thing that he wanted everyone to keep in mind was that this building was an iconic building and that Ranch Style Beans was an important part of Fort Worth for a long time. He added that he felt this building needed to continue in that fashion. He stated he was not sure where it would fit in but it needed to be more than on a poster and part of a memory. He indicated that was what the City of Fort Worth was all about. This concluded the presentation and discussion on this agenda item. CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 8 of 20 Presentation on Renewal of Tax Abatement Policy and Recommended Revisions (Agenda Item 6) Robert Sturns, Manager, Housing and Economic Development Department, spoke before the committee on the renewal of the City's tax abatement policy and the recommended revisions to the policy. He advised that City staff was distributing to the committee members a copy of the City's current tax abatement policy along with a survey of area cities regarding their tax abatement policies. Using a PowerPoint presentation, Mr. Sturns reviewed the presentation objectives as follows: ■ To discuss the state legislation that required adoption of a Tax Abatement Policy. ■ To outline the proposed changes to the existing Tax Abatement Policy. ■ To receive direction regarding the Proposed Tax Abatement Policy and discussed next steps. Mr. Sturns advised of the state law requirements for a Tax Abatement Policy as follows: ■ Chapter 312 of the Texas Tax Code required that a municipality have "established guidelines and criteria governing tax abatement agreements ". ■ The "established guidelines and criteria" were effective for two years from the date adopted. ■ Last policy was adopted on June 16, 2008. Mr. Sturns pointed out that it was time to renew the City's existing policy. He pointed out that under the City's existing policy, if the Allens, Inc., project was finally approved, it would be the only company that had utilized those 2008 requirements. He added that was a statement of the current financial environment and the economic difficulties that the City was facing. He added that the proposed changes to the policy were to reflect those economic realities and to ensure that the City remained competitive in the market place. He referenced the survey document of other cities and how their policies related to the proposed changes that the City staff was going to proposed today. Mr. Sturns pointed out that the committee members would not be seeing anything that had not already been proposed in other cities. Mr. Sturns reviewed the proposed changes as follows: CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 9 of 20 Presentation on Renewal of Tax Abatement Policy and Recommended Revisions (cont'd) (Agenda Item 6) ■ Page 5, Sections 4.2 and 5.2 and 6.2: Reduce threshold on capital investment from $10.0 M to $5.0 M for Commercial /Industrial, Mixed -Use and Business Expansion projects. ■ Page 5, Sections 3.2 and 3.3: Reduce threshold on capital investment from $5.0 M to $2.0 M on residential projects eligible for abatement. ■ Page 7 — Section 7.6: For multi - family residential and mixed -use projects, applicant will commit to a set number or certain percentage of handicap accessible units. ■ Page 9- Section 10.2: Reduce the application fee from $15,000 to an amount to be determined with a minimum $2,000 being non - refundable. Mr. Sturns presented the following proposed changes that were referenced on page 10, Sections 10.3 and 10.4 of the policy: ■ Favorable consideration will be given to applicants for tax abatement that provide equal benefits for all employees. ■ Consideration for an additional 10% abatement for a LEED certified project (project would have to actually get the certification). He explained that it also applied to sustainable development. He added that they were also trying to address the "green" technology issues. ■ Remove language in the policy regarding the applicant's Board of Directors and as it related to the gender and ethnicity makeup of the board of directors. ■ Clean -up language regarding evaluation by Council Committee. Mr. Sturns then presented the next steps in the process as follows: ■ Final Policy will be provided in June HED Committee packet. ■ Receive feedback from HED Committee for a 30 -day period. CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 10 of 20 Presentation on Renewal of Tax Abatement Policy and Recommended Revisions (cont'd) (Agenda Item 6) ■ Place an M &C and resolution on the June 15`h Council agenda for consideration of the Tax Abatement Policy. Mr. Sturns completed his presentation. Chairman Jordan opened the floor for discussion and /or comments. He advised that this presentation and the next presentation on Tax Increment Finance Districts were overviews being done today to ensure that these policies were fulfilling the visions that the City had for these programs as incentive programs. He pointed out that the incentive for the tax abatement policy was to produce jobs. He stated that the City of Fort Worth continued to grow as a city and people were coming here to live and work. He stated he felt it was incumbent on this committee as a group and the City staff to work hard to produce the jobs that would continue to lead the City down the path that would make it a successful city. He asked that the members review the policy in that regard. Committee Member Moss requested clarification on the proposed change to remove the language in the policy regarding the applicant's board of directors. He pointed out that the City was not saying there was a requirement. He added at the time the City Council implemented that provision, the Council wanted to know what was the composition of the various governing bodies of the companies. Mr. Sturns reiterated that it was just a request and was not criteria for providing the tax abatement. Mr. Sturns pointed out at the time the Council decided on these criteria was due to the fact that they were concerned about the gender and make -up of the various boards. Mr. Sturns clarified that the City staff was recommending that requirement be removed from the policy. Committee Member Moss indicated that he had a problem with that proposed change. Chairman Jordan reiterated that the City staff was looking for this type of feedback, i.e., if there were any concerns. Committee Member Espino referenced the proposal for the handicapped accessible units and requested clarification that the proposal was just setting the criteria and not setting an amount or goal for the number of units. He then read aloud that section of the policy, Section 7.6.: "For Residential Development Projects and Mixed -Use Development Projects that include rental residential units, commit to a set number or percentage of total rental residential units that CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 11 of 20 Presentation on Renewal of Tax Abatement Policy and Recommended Revisions (cont'd) (Agenda Item 6) must be fully handicap accessible." He then clarified with the City staff that this would be based upon a case by case basis. Mr. Sturns concurred. Committee Member Scarth requested clarification as to whether the City staff had looked at including "universal design" units on all or a majority of the units rather than setting a goal for a certain number of handicapped accessible units. He pointed out that there was a considerable difference between "universal design" and handicapped accessibility. He added that a lot of the specifications for "universal design" was not very expensive to implement, i.e., blocking in the walls in the restrooms to add hand rails if necessary, door thresholds, doorways, etc. He pointed out that these designs were less expensive then adding these changes later on to make it a fully accessible unit. He recommended that the "universal design" specifications be looked at and a determination made whether the design should be rolled into the policy rather than providing a number of fully accessible units. Chairman Jordan requested that the committee members review the documents provided and provide input as necessary to the City staff over the next 30 days. This concluded the presentation and discussion on this agenda item. Overview of Tax Increment Finance Districts and Various Funding Obligations (Agenda Item 7) Chairman Jordan advised that he had requested an update on the City's Tax Increment Finance Districts and this presentation was to fulfill that request. Mr. Jay Chapa, Director of Housing and Economic Development, spoke before the committee members on the overview of the Tax Increment Finance Districts (TIFs) and the various funding obligations. He advised that the overview would provide for the financial condition of the TIFs and where they were at the present time financially as the City Council goes through the full budget process. Mr. Chapa provided the TIF Summary as follows: ■ Tax increment financing (TIF) was an economic development tool authorized by Chapter 311 of the Texas Tax Code by which governments could publicly finance CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 12 of 20 Overview of Tax Increment Finance Districts and Various Funding Obligations (cont'd) (Agenda Item 7) needed structural improvements and enhanced infrastructure within a reinvestment zone. ■ The City of Fort Worth had eleven (11) active TIF districts: Speedway, Downtown, Southside, Riverfront, North Tarrant Parkway, Lancaster, Trinity River Vision, Lone Star, Southwest Parkway, East Berry Renaissance, and Woodhaven. Mr. Chapa stated that the City of Fort Worth TIF Policy contained the following information: ■ Each TIF application must demonstrate: - "But for" the creation of a TIF, development was not likely to occur in the proposed area without financial assistance from a TIF; and /or - An area was ripe for development or redevelopment provided that public infrastructure was constructed to support the revitalization of the area; and /or - Use of a TIF was the appropriate incentive tool to recruit or relocate a catalyst project worthy of public investment; and - The area proposed for TIF designation would have an increase in real property taxable value within the first two (2) years following designation. Mr. Chapa advised that the TIF Policy was amended in December 2009 with the following changes: - "The term of any newly created TIF may not excced 21 years (20 years of tax increment collection), unless otherwise approved by City Council. - Only TIFs created to help finance a "major infrastructure project ", as designated by City Council, may have a term greater than 21 years. - The longer term shall only be permitted as necessary to fully finance the "major infrastructure project ". CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 13 of 20 Overview of Tax Increment Finance Districts and Various Funding Obligations (cont'd) Mr. Chapa presented the Taxable Value Increment as follows: ■ Revenues based on taxable value increment ■ Taxable Value — Base Value = Increment (Agenda Item 7) ■ Base value and taxable value may vary by taxing entity depending on exemptions and jurisdictions. ■ Taxable value growth is usually estimated at 1.5% growth per year, while also taking into account potential development projects. Mr. Chapa provided a chart of each of the TIFs showing their financial standing as follows: TIF 2 (Speedway) Created: 1996 — expiration: 2035 Value Fiscal Year 2010 Value Increment Collected CFW Portion Increment Expended to Date Projected Increment (term) CFW Portion (term) Estimated Unobligated Balance (term) - Base Value: $5,084,127. - Includes TIF 213; Northwest ISD is the only contributor to TIF 2B. TIF 3 (Downtown) Created: 1996 — expiration: 2025 Value Increment Collected CFW Portion Increment Expended to Date Projected Increment (term) CFW Portion (term) Estimated Unobligated Balance (teen) Fiscal Year 2010 Value $11,334,082 $360,002 $11,118,337 $57,049,759 $15,093,686 $0 $5,000,000 $1,948,102 $30,010,925 $72,000,000 $30,477,000 $13,1 17,757 CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 14 of 20 Overview of Tax Increment Finance Districts and Various Fundinp- Obligations (cont'd) (Agenda Item 7) - Base Value: $322,440,637 - Includes TIF 3A; Fort Worth ISD does not participate in TIF 3A; Fort Worth ISD drops out in 2013. TIF 3 will hit its lifetime revenue cap of $72 million in 2017. TIF spends $3 million per year on garage leases to provide free public parking that supports more than $60 million in retail sales. TIF 4 (Southside) Created: 1998 — Expiration: 2022 Value Fiscal Year 2010 Value Increment Collected $6,225,965 CFW Portion $1,883,590 Increment Expended to Date $11,118,337 Projected Increment (term) $62,118,052 CFW Portion (term) $20,814,159 Estimated Unobligated Balance (term) $14,647,803 - Base Value: $229,759,626 - TIF 4 is to remain active for 25 years or until a cash increment of $60 million has been collected, estimated to be 2014. - TCHD contribution is capped at $3.5m; County's contribution is capped at $4m; $15m of FWISD's contribution will be returned to the school district. TIF 6 (Riverfront — Radio Shack Project) Created: 2002 — Expiration: 2036 Value Increment Collected CFW Portion Increment Expended to Date Projected Increment (term) CFW Portion (term) Estimated Unobligated Balance (term) - Base Value: $2,822,348 Fiscal Year 2010 Value $505,210 Does not participate $2,817,682 $22,420,168 Does not participate $0 - City of Fort Worth and Fort Worth ISD do not participate. - Estimates based on billing amount; Not billed in FY' 10 due to outstanding property protest CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 15 of 20 Overview of Tax Increment Finance Districts and Various Funding Obligations (cont'd) TIF 7 (North Tarrant Parkway) Created: 2003 — Expiration: 2019 Value Increment Collected CFW Portion Increment Expended to Date Projected Increment (term) CFW Portion (term) Estimated Unobligated Balance (term) - Base Value: $1,559,670 - TCCD, Keller ISD, and Northwest ISD do not participate. - TCHD participation agreement is yet to be signed. TIF 8 (Lancaster) Created: 2003 — Expiration: 2024 Value Increment Collected CFW Portion Increment Expended to Date Projected Increment (term) CFW Portion (term) Estimated Unobligated Balance (term) - Base Value : $178,938,722 - Fort Worth ISD does not participate. - TCHD participation agreement is yet to be signed. (Agenda Item 7) Fiscal Year 2010 Value Fiscal Year 2010 Value TIF 9 (Trinity River Vision) Created: 2003 — Expiration: 2044 Value Increment Collected CFW Portion Increment Expended to Date Projected Increment (term) CFW Portion (term) Estimated Unobligated Balance (term) Fiscal Year 2010 Value $1,229,216 $920,475 $1,206,006 $32,567,665 $20,572,379 $22,127,575 $3,016,212 $1,966,068 $5,669,837 $79,891,888 $46,427,723 $59,936,542 $1,886,635 $838,029 $1,576,015 $448,037,396 $254,556,975 $0 CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 16 of 20 Overview of Tax Increment Finance Districts and Various Funding Obligations (cont'd) (Agenda Item 7) - Base Value: $133,860,211 - Includes TIF 9A & 9B, TIF 9B revenue not calculated until 2010. - Estimates provided by Gideon Toal. TIF 10 (Lone Star- Cabella's Development) Created: 2004 — Expiration: 2025 Value Fiscal Year 2010 Value Increment Collected $436,967 CFW Portion $281,154 Increment Expended to Date $1,570,749 Projected Increment (term) $8,660,598 CFW Portion (term) $6,017,308 Estimated Unobligated Balance (term) $0* - Base Value: $12,519,651 - TIF I OA values not included; No increment will be collected from TIF IOA this year as it reflected a negative taxable value. - *TIF is only liable to the extent of the TIF revenues received. TIF 11 (Southwest Parkway) Created: 2004 — Expiration: 2025 Value Fiscal Year 2010 Value Increment Collected $109,575 CFW Portion $93,036 Increment Expended to Date $0 Projected Increment (term) $2,452,059 CFW Portion (term) $1,891,307 Estimated Unobligated Balance (term) $0 - Base Value : $60,241 - TCHD has not yet signed a participation agreement. TIF 12 (East Berry Renaissance) Created: 2006 — Expiration: 2027 Value Fiscal Year 2010 Value Increment Collected $97,047 CFW Portion $60,438 Increment Expended to Date $15,099 CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 17 of 20 Overview of Tax Increment Finance Districts and Various Funding Obligations (cont'd) (Agenda Item 7) Projected Increment (term) $12,448,760 CFW Portion (term) $7,298,152 Estimated Unobligated Balance (term) $3,305,717 - Base Value: $29,176,323 - TCCD has not yet signed a participation agreement. - TCHD has not yet signed a participation agreement. TIF 13 (Woodhaven) Created: 2007 — Expiration: 2028 Value Fiscal Year 2010 Value Increment Collected $36,583 CFW Portion $27,894 Increment Expended to Date $13,789 Projected Increment (term) $8,864,966 CFW Portion (term) $5,597,762 Estimated Unobligated Balance (term) $8,428,473 - Base Value: $181,846,751 - TCCD has not yet signed a participation agreement. - TCHD has not yet signed a participation agreement. Mr. Chapa presented the overall TIF Districts financial impact as follows: Overall TIF District Financial Impact All TIF Districts FY 2010 Projected Revenue $19,372,284 Taxable Value Increment $1,613,800,318 FY 2010 CFW Contributions $8,378,788 FY 2010 TIF Commitments $12,336,998 Lifetime CFW Contributions $416,531,460 Lifetime l_'nobligated Balance $121,563.867 CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 18 of 20 Overview of Tax Increment Finance Districts and Various Funding Obligations (cont'd) (Agenda Item 7) Mr. Chapa concluded his presentation. Chairman Jordan opened the floor for discussion and /or comments. He reminded the committee members that the use of the TIFs in the City of Fort Worth had been a very successful program. He pointed out that the City of Fort Worth had been a pioneer in the use of TIFs to look at either blighted or underperforming areas of the City and to use them to redevelop those areas. He indicated that he felt the City needed to move to a policy discussion as to whether the intent was to allow the boards of the TIFs to determine how their monies were to be spent or once the TIFs reached their terms then the funds should be converted back and placed in the City's general fund for revenue use by the entire City. He added he felt for a long time that the visionary financial policy had been successful in generating revenues from these TIFs and for the long term basis it should be determined to return those monies to the City's general fund. He pointed out that right now the City was spending general fund monies on some of these TIFs in police and fire protection and the TIFs were not reimbursing the City. He added overall if the City had lifted a non - producing area to an area that was producing revenue then the intent would be to use it in the general fund in the future. Committee Member Burdette indicated that he agreed with the comments made by Chairman Jordan and added that he felt that the City needed to think about the development of some type of criteria whereby the TIFs could be judged at some time in the future. He pointed out that some TIFs may produce early on their based intended results and; therefore, may not be that productive on a local basis in their future. He added that might be some basis for terminating them and returning those monies back to the City's general fund. He pointed out that there may be other TIFs that continue to develop new opportunities which in the long run generate more tax increments and should stay in effect for a longer period of time. Committee Member Burdette reiterated that he felt that criteria should be developed, if there was not something already in place to make that determination. Committee Member Moncrief stated that he felt this was a timely presentation given that the budget preparation for the City was coming up. He pointed out that the presentation demonstrated that the process worked. He added that at the same time that the City was not TIF poor, given the size of the City, the size of the City's budget and what the City had planned for. He added that there were nay sayers that were stating that what the City Council was doing was not responsible and that it was all to benefit the developers who were seeking support for their various programs and /or products. He added that the fact was that this was a small percentage of what the City does, it was well in keeping with the national average. He pointed out the one CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 19 of 20 Overview of Tax Increment Finance Districts and Various Funding Obligations (cont'd) (Agenda Item 7) thing that he did not feel was projected as far as it would go was the Southwest Parkway TIF. He added that he felt it would take off like a rocket ship. He pointed out that it was now under construction and while it was very painful for the traffic to get around in the City from point A to point B, he felt it was going to show tremendous results. Committee Member Moncrief indicated that he was hopeful that the City was going to get the Hospital District to participate in that effort. Chairman Jordan pointed out that it took almost fifty years for that project to begin but once the word was given to start it, the construction had been going full force. Committee Member Hicks pointed out that it was only fair that the City look at the subject areas to see whether they would have developed without the benefit of the TIF. She pointed out that early on the City Council had looked at a TIF for the redevelopment of 7t" Street and the City was able to utilize other economic incentives and other development opportunities for that area and did not have to create a TIF for that area. She added that development was moving along just fine as opposed to the Fort Worth South area. She also referenced the Medical District and the use of TIFs in both of those areas had resulted in something phenomenal. She commended the City staff on their efforts to look into the City's tool kit to see what was available and whether it would work in a particular area. Committee Member Hicks pointed out the various economic development tools that had to be utilized for the Masonic Home area because developers were just not looking at that area. She also made reference to areas of the City where TIFs were requested but the use of the economic tool in those areas was not valid or reasonable and the areas developed anyway. She again commended the City staff on their knowledge and use of the various economic mechanisms and also supported the need to look at the TIFs for their effectiveness and where they are located. Chairman Jordan advised the committee members that they would be hearing a lot on the new terminology of "transportation reinvestment zones." He explained that the Regional Transportation Council of the North Central Texas Council of Governments was looking at the Cottonbelt Rail Line and at public /private partnerships for the creation of "transportation reinvestment zones" and he had asked for the City staff to participate in that endeavor. He requested again to the City staff that they develop benchmarking or other criteria for measuring the TIFs and bring back a recommendation to the committee. CITY OF FORT WORTH CITY COUNCIL HOUSING AND ECONOMIC DEVELOPMENT COMMITTEE May 4, 2010 Page 20 of 20 Overview of Tax Increment Finance Districts and Various Funding Obligations (cont'd) (Agenda Item 7) Chairman Jordan expressed appreciation to the City staff for the presentation and recognized Assistant City Manager Tom Higgins on his pioneering efforts for bringing the TIF economic tool to the State of Texas. This concluded the presentation and discussion on this agenda item. Request for Future Agenda Items (Agenda Item 8) There were no future agenda items requested by the committee members. Date of Next Regular Meeting — June 1, 2010 (Agenda Item 9) Chairman Jordan advised that he was not certain when the next regular meeting of the Housing and Economic Development Committee would be held as the June 1, 2010, City Council meeting had been cancelled. Assistant City Manager Tom Higgins advised that it would probably be held on Tuesday, June 8, 2010. Adiourn (Agenda Item 10) With no further presentations or discussions, Chairman Jordan adjourned the regular meeting of the Housing and Economic Development Committee at 1:58 p.m., on Tuesday, May 4, 2010. These minutes approved by the Housing and Economic Development Committee on the 8th day of June, 2010. APPROVED• d4'r��� Jurys Jor n, Chairman Minutes Prepared by and Attest: Martv Hendrix, 'itv Secrctary