HomeMy WebLinkAbout2013-12-02 Special Meeting of La Porte City CouncilLOUIS RIGBY
Mayor
JOHN ZEMANEK
Councilmember At Large A
DOTTIE KAMINSKI
Councilmember At Large B
MIKE MOSTEIT
Councilmember District 1
CHUCK ENGELKEN
Councilmember District 2
MINUTES OF THE SPECIAL MEETING OF THE
CITY COUNCIL OF THE CITY OF LA PORTE
DECEMBER 2, 2013
DARYL LEONARD
Councilmember District 3
TOMMY MOSER
Councilmember District 4
JAY MARTIN
Mayor Pro Tern
Councilmember District 5
MIKE CLAUSEN
Councilmember District 6
The City Council of the City of La Porte met in a special meeting on Monday, December 2, 2013, at the
City Hall Council Chambers, 604 West Fairmont Parkway, La Porte, Texas, at 5:00 p.m. to consider the
following items of business:
CALL TO ORDER
Mayor Rigby called the meeting to order at 6:00 p.m. Members of Council present:
Councilmembers Leonard, Zemanek, Kaminski, Mosteit, Martin, and Clausen. Also present were
City Secretary Patrice Fogarty, City Manager Corby Alexander, and Assistant City Attorney Clark
Askins. Absent: Councilmembers Engelken and Moser.
2. DISCUSSION OR OTHER ACTION
(a) Discussion or other action regarding tax increment reinvestment zones (TIRZ): creation,
criteria for creation; financing; authorized improvements; administration; eligible project
costs; responsibilities of municipality; changing boundaries of existing zone; board; project
plan and reinvestment zone financing plan; determination of amount of tax increment;
termination of reinvestment zone; any other TIRZ-related items — David Hawes, Hawes Hill
Calderon LLP.
David Hawes provided a PowerPoint presentation and advised Council regarding the laws and
procedures of establishment of a TIRZ. A Tax Increment Reinvestment Zone ("TIRZ') is a
development and redevelopment financing tool created under the provisions of the Texas Tax Code
Chapter 311, the Tax Increment Financing Act ("Chapter 311"). A TIRZ provides a method to finance
improvements in a specifically designated zone using property tax increment funds. Cities may
designate a specific geographic area as a Reinvestment Zone to promote development or
redevelopment of the area if such development would not occur solely through private investment in
the reasonably foreseeable future. Therefore, the basis for establishing a TIRZ is to facilitate the
development or redevelopment of an area that would not occur without the City's intervention.
When questioned specifically about La Porte ISD's involvement in the TIRZ, Mr. Hawes reported La
Porte ISD participates at a hundred percent of its tax rate in the Tax Increment Reinvestment Zone.
The taxes are collected by the City of La Porte on behalf of La Porte Independent School District
and in a plan approved by La Porte City Council, 86 percent of the taxes goes into funding projects
within the financing project plan and the difference between the 86 cents and the total tax rate is
rebated back to La Porte ISD to pay for educational facilities and/or other purposes within the
district.
Mr. Hawes explained the City's creation of the TIRZ, and how the creation of a TIRZ is a financing
mechanism. He touched on the following information regarding tax increment reinvestment zones:
the premise and laws providing for creation for the purpose of promoting development or
redevelopment of the area if the governing body determines that development or redevelopment
would not occur solely through private investment in the reasonably foreseeable future.
He spoke on the responsibilities of a municipality prior to creation of a TIRZ. Before adopting an
ordinance providing for a reinvestment zone, the governing body must prepare a preliminary
reinvestment zone financing plan, send copy of the plan to the governing body of each taxing unit
that levies taxes on real property in the proposed zone, hold a public hearing on the creation of the
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December 2, 2013, Council Meeting Minutes
zone and its benefits to the municipality and to the property in the proposed zone, and notice of
public hearing must be published seven days prior to the established hearing date.
The project plan must include:
• A map showing existing uses and conditions of real property in the zone,
• A map showing proposed improvements to and proposed uses of that property,
• Proposed changes of zoning ordinances, the master plan of the municipality, building codes, and
other city ordinances,
• A list of the estimated non -project costs, and
• A statement of a method of relocating persons to be displaced as a result of implementing the plan
The plans must be as consistent as possible with the preliminary financing plan developed for the
zone before the creation of the board.
The Reinvestment Zone Financing Plan must include:
• A detailed list describing the estimated project costs of the zone, including administrative expenses,
• A statement listing the kind, number, and location of all proposed public works or public
improvements in the zone,
• An economic feasibility study,
• The estimated amount of bonded indebtedness to be incurred,
• A description of the method of financing all estimated project costs and the expected sources of
revenue to finances or pay project costs,
• The current total appraised value of taxable real property in the zone,
• The estimated captured appraised value of the zone during each year if its existence, and
• The duration of the zone
The board of directors may adopt an amendment to the project plan, and the amendment takes effect
on approval of an ordinance by the governing body of the municipality.
The term tax increment financing refers to the amount of tax revenue generated on the increased
property values that result from the development improvements. Participating taxing units continue to
receive tax revenue on the property tax values in the year the TIRZ is created. At the time the TIRZ is
created, the base taxable value is established. In subsequent years, for the life of the zone,
participating taxing units continue to collect revenue on the established base taxable value. The tax
revenue on the incremental value is used to finance public improvements within the zone.
Under Chapter 311, tax-exempt bonds may be sold to finance public improvements within the Zone. If
bonds are sold to fund improvements, taxes generated on the increased property value above the base
are dedicated to paying debt service on the TIRZ bonds. If no bonds are issued, these tax increment
funds may directly finance the zone improvements. No assessments are made over and above the
normal property taxes. In Harris County, Chapter 311 mandates that one-third of the tax increment be
dedicated to providing low/moderate income housing in the city if the TIRZ is created by petition. Other
taxing units, such as the county and school district may participate in whole or in part, in the TIRZ, but
are not required to do so.
Development activities for the zone must follow a project and financing plan. This plan must be
approved by the city council. Mr. Hawes pointed out that if applicable, relocation assistance must be
provided for persons who are displaced by the implementation of zone improvements.
An appointed Board of Directors administers a TIRZ. Mr. Hawes is contracted with the Redevelopment
Authority to administer all aspects of the TIRZ in La Porte.
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December 2, 2013, Council Meeting Minutes
3. COUNCIL COMMENTS regarding matters appearing on the agenda; recognition of community
members, city employees, and upcoming events; inquiry of staff regarding specific factual
information or existing policies — Councilmembers Zemanek, Leonard, Engelken, Mosteit, Clausen,
Martin, Moser, Kaminski and Mayor Rigby.
Councilmember Kaminski commented she attended the Thanksgiving By the Bay event and
assisted with the Food Drive on Saturday. She also thanked David Hawes for an informative
presentation, as did Councilmembers Zemanek, Leonard, Mosteit, Clausen, Martin and Mayor
Rigby.
4. ADJOURN
There being no further business, Councilmember Mosteit moved to adjourn the meeting at
6:28 p.m. Councilmember Leonard seconded. MOTION PASSED.
Patrice Fogarty, Ci ecret
Passed an r e on January 13, 2013.
Ma r Lo is R. Ri y
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December 2, 2013, Council Meeting Minutes