STRATEGIC PRIORITY: Economic Development
AGENDA DATE: February 28, 2024
COUNCIL DISTRICT(S): 2, 7, 14
DEPARTMENT: Office of Economic Development
EXECUTIVE: Majed Al-Ghafry
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SUBJECT
Title
A public hearing to receive comments on the proposed amendments to the Project Plan and Reinvestment Zone Financing Plan (“Plan”) for Tax Increment Reinvestment Zone Number Twelve, the Deep Ellum Tax Increment Financing (“TIF”) District (the “TIF District”) to: (1) increase the total budget for the Deep Ellum TIF District from $29,992,935.00 net present value (approximately $57,641,077.00 in total dollars) to $46,408,080.00 net present value (approximately $93,519,023.00 in total dollars); (2) redefine and reallocate budget categories; and (3) make corresponding modifications to the TIF District’s Plan; and, at the close of the public hearing, consider an ordinance amending Ordinance No. 26043 previously approved on June 22, 2005, and Ordinance No. 26304 previously approved on April 12, 2006, as amended, to reflect these amendments - Financing: No cost consideration to the City
Body
BACKGROUND
The Deep Ellum TIF District was established by Ordinance No. 26043 on June 22, 2005, to assist in the transformation of the Deep Ellum area into a more diversified, pedestrian friendly, mixed-use neighborhood and improve the urban fabric and connections between Central Expressway and Fair Park.
The Deep Ellum TIF District’s taxable value has increased 651% over the adjusted base year, accounting for $1,231,717,803.00 in captured taxable value. Given the strong property value growth, it is anticipated that the TIF District’s $29,992,935.00 budget cap will be reached before the TIF District’s scheduled termination at the end of 2027. In contrast, the abutting Grand Park South TIF District, which was also created in 2005 and is scheduled to terminate on December 31, 2035, has experienced only $87 million in captured value and is unlikely to reach its budget cap within the existing term.
As a win-win proposal for both the Deep Ellum TIF District and the Grand Park South area, staff has proposed amendments to the Deep Ellum TIF District Plan that would increase the budget capacity of the Deep Ellum TIF District while keeping the scheduled termination date (December 31, 2027) unchanged. The proposed Plan amendments are designed to provide additional funding capacity to (a) fund close-out projects within the Deep Ellum TIF District, including implementing planned cultural initiatives; (b) fund homeowner stabilization and implement mixed-income housing in and surrounding the Deep Ellum TIF District; (c) fund areas of public assembly (i.e. parks/open space) in and out of the Deep Ellum TIF District; and (d) fund assistance to the Grand Park South neighborhoods adjacent to the south, improving area infrastructure and reconnecting neighborhoods.
The proposed amendments to the Plan would utilize increment generated by the Deep Ellum TIF District between 2023 collections and termination (2027) as follows:
1) Retain 60% of Deep Ellum TIF District’s annual increment for close-out district-wide projects and mixed-income housing projects
2) Transfer 20% of Deep Ellum TIF District's annual increment to the City’s Department of Housing and Neighborhood Revitalization to support programs addressing homeowner stabilization, home repair, and displacement mitigation as well as possible mixed-income housing development intended for use in the Grand Park South area
3) Set Aside 20% of Deep Ellum TIF District's annual increment to support Grand Park South area infrastructure improvements and areas of public assembly (i.e. parks/open spaces)
Pursuant to the Tax Increment Financing Act, as amended, Texas Tax Code, Section 311 (the “Act”), a public hearing is required if an amendment proposes to reduce or increase the geographic area of a TIF district, increase the amount of bonded indebtedness to be incurred, increase or decrease the percentage of a tax increment to be contributed by a taxing unit, increase the total estimated project costs, or designate additional property in the TIF district to be acquired by the municipality. Per the Act, notice of the public hearing will be published in Dallas Morning News, a daily newspaper of general circulation in the City, at least seven days before the date of the public hearing.
This public hearing is being held to hear public comments on the proposed amendments to the Plan for the TIF District.
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
On June 22, 2005, the City Council authorized the creation of Tax Increment Financing Reinvestment Zone Number Twelve, the Deep Ellum TIF District, in accordance with the Tax Increment Financing Act, as amended, Texas Tax Code Section 311, by Resolution No. 05-1971; and Ordinance No. 26043.
On April 12, 2006, the City Council authorized the Project Plan and Reinvestment Zone Financing Plan for the Deep Ellum TIF District by Resolution No. 06-1077; and Ordinance No. 26304.
On April 9, 2008, the City Council authorized amendments to the Project Plan and Reinvestment Zone Financing Plan for the Deep Ellum TIF District to include the Latino Cultural Center and selected and adjacent properties by Resolution No. 08-1081; and Ordinance No. 27136.
On June 22, 2011, the City Council authorized amendments to the Project Plan and Reinvestment Zone Financing Plan for the Deep Ellum TIF District to allow a directed sale of City-owned property to facilitate implementation of the proposed development plan for the City Lights Project by Resolution No. 11-1753; and Ordinance No. 28291.
On September 10, 2014, the City Council authorized amendments to the Project Plan and Reinvestment Zone Financing Plan for the Deep Ellum TIF District to: (1) increase the geographic area to add traditional core area of Deep Ellum (approximately 51.0 acres) to facilitate the development of the Deep Ellum Crossroads project and encourage further redevelopment of the TIF District; and (2) increase the budget of the Deep Ellum TIF District from $27,162,083.00 NPV ($51,706,392.00 total dollars) to $29,992,935.00 NPV ($57,641,077.00 total dollars) by Resolution No. 14-1519; and Ordinance No. 29469.
On December 5, 2023, the Board of Directors of the Deep Ellum TIF District reviewed and unanimously recommended City Council approval of the proposed amendments to the Project Plan and Reinvestment Zone Financing Plan for the Deep Ellum TIF District.
The Economic Development Committee was briefed on the Deep Ellum TIF District: Proposed Plan Amendment on February 5, 2024.
On February 14, 2024, the City Council authorized a public hearing to be held on February 28, 2024, to receive comments on the proposed amendments to the TIF District Plan.
FISCAL INFORMATION
No cost consideration to the City.
MAP
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