So Downtown Property Values are more important than anything else?
As most Midlanders know Jal Draw Improvements, (the Ditch north of Wadley) have been necessary for well over a decade. To see the City moving on rehabilitating this channel is comforting to the residents and businesses who are located along the channel and the thousands of residents along a line from Whitney to Fannin to Scharbauer who rely on that channel to protect them from flood waters.
I think the story lead and the quote from former Councilor Morgan sum up the situation pretty well.
The rehabilitation of Jal Draw, perhaps one of the city's most urgent needs, could be under way by spring......Former District 1 Councilwoman LuAnn Morgan said the deteriorating, dirt-walled draw has worried her for nine years and now is a priority of her successor, Jeff Sparks
However, the quote from our Mayor a couple of paragraphs down is a little troubling:
Perry said the task has been budgeted for two years but was delayed while the council bolstered the downtown tax base. "When those investments paid off with values going up by double digits every year, we went back to the basics and Jal Draw quickly came to the top of the list," he said."Repairing this kind of infrastructure is like putting in new air conditioning or plumbing. It's expensive and you don't see it, but if you don't have it you don't have a house."
Huh? Increasing the tax base in downtown over the last two years has been more important than a budgeted, vital infrastructure rehabilitation? It's not like those increased downtown property values are actually going to help pay the cost of this rehabilitation, or any rehabilitation that doesn't occur within the downtown Tax Increment Reinvestment Zone.
Since 2001, every single property tax dollar from the City of Midland, Midland County, Midland College and the Hospital District generated from downtown taxable values greater than $98,933,311 dollars, go straight to the TIRZ account, only to be used within the TIRZ boundary per the requirements of Chapter 311 of the Tax Code.
Since 2004, the year the property values rose back above $98,933,311, the Midland TIRZ has banked about $1.4 million dollars. I don't know about 2009, but according to City of Midland CAFRs for 2005-2008, the TIRZ spent a grand total of $17,167.
Personally, I think Downtown should be left to the TIRZ, the Downtown Midland Management District the MDC and their bankrolls. Ostensibly thats why those entities and their tax funded accounts were created? So why is something that was these entities direct concern (downtown tax values) siphoning off budgeted dollars from needed infrastructure for thousands of citizens while they make bank?
I hope the Mayor was taken out of context or misquoted, because I think the Council can safely take their eyes off the development of downtown and concentrate on the infrastructure of our City as a whole.
Because, the fruits of the City's labor to increase the downtown property values aren't putting money in the City Budget to pay for needed infrastructure improvements, nor are they decreasing the overall property tax bill for the citizens. It is benefitting the TIRZ and the DMMD. Maybe it is time to make them let loose their bounty in their own self interest.
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6 Comments
Correct.
What makes the TIRZ more interesting is that it involves the County, College and Hospital too. So, increases in Downtown property values don't go to their bottom lines either. (or lower our tax burdens)
So, with the exception of MISD, nobody else in Midland is directly benefitting from the increased property values in downtown.
Now that the TIRZ has some regular income, I'm wondering when they are going to issue the tax revenue bonds for downtown improvements. The TIRZ plan all along was to issue over $28 million in bonds for the sole purpose of downtown improvements, paid with this "above the cap" advalorem tax revenue through 2031.
Which is why I ask the question of the City's continued financing of downtown projects from the general fund.

1. I would hope that our mayor would take the opportunity to extend and clarify his remarks. Downtown development and valuation is a real conflict of interest issue with this mayor, unlike his recent predecessors.
2. Why don't the downtown entities, and maybe MDC, fund the Jal Draw repair? I would take that as an alternative to getting our money back directly from their coffers.

Maybe it is time for the mayor to show us how the TIRZ and management district have really benefited Midlanders.
At that time maybe he could also disclose when the TIRZ and MMMD might come to an end (considering the valuation increase we are seeing downtown).
Question here: When the Heritage Building was sold to the County for 6 million or whatever the number was, didn't the taxpayer get the double shaft as commissioners paid so much for the building and it was taken off the tax rolls?

Without intervention I can tell you when these entites will end:
TIRZ: 2031.
DMMD: 2019.
Just last fall the DMMD extended their existence 10 years. It has taken years for these entities to build up some bankrolls, but the fear now is that they will use their projected tax revenues to take out development loans predicated on future advalorem revenue.
According to past MRT stories, the TIRZ, the DMMD, and the MDC are supposed to be meeting monthly, but outside of stories filed by the local beat/cub reporters there really isn't much data on these entities.

I didn't answer your question Stewart, but we did cover that exact aspect at the Well when the building was bought.
Yes, once that building and the surrounding parking lots were acquired by the County, that put a big hit on downtown values. Some MRT stories say that the Hilton is one of the most valuabe building at $13M, so taking a $6M building out of the revenue stream is big.





Nice post, Ospurt.
Question: So any increase in valuations downtown isn't really taking the burden off the homeowner because of the TIRZ, right?