STRATEGIC PRIORITY: Growing
AGENDA DATE: May 14, 2025
COUNCIL DISTRICT(S): 2, 14
DEPARTMENT: Office of Economic Development
EXECUTIVE: Robin Bentley
______________________________________________________________________
SUBJECT
Title
Authorize (1) a development agreement with Tango North RF, LLC and/or its affiliates (“Developer”) in an amount not to exceed $29,399,487.00 (“TIF Subsidy”), payable from current and future Downtown Connection Sub-district funds in the Downtown Connection Tax Increment Financing (“TIF”) District (“Zone”), in consideration of the Developer’s design, engineering, financing, and construction of a new Fire Station No. 18 and associated infrastructure and streetscape improvements (“Project”) to be developed on three vacant properties currently addressed as 1205 Patterson Avenue, 1212 San Jacinto Street, and 1214 San Jacinto Street and adjacent rights-of-way in the Zone; (2) upon completion and acceptance of the Project: (a) City’s acquisition from Developer of the properties addressed as 1205 Patterson Avenue, 1212 San Jacinto Street, and 1214 San Jacinto Street totaling approximately 0.967 acres (the property on which the future Fire Station No. 18 will be located); and (b) City’s direct sale to the Developer of approximately 1.09 acres of property addressed as 660 North Griffin Street, including the existing Fire Station No. 18 in as-is condition and at fair market value in accordance with Chapter 311 of the Texas Tax Code and Chapter 272 of the Texas Local Government Code; and (3) upon completion and acceptance of the Project, the City Manager to execute customary and reasonable closing documents, as may be required and approved as to form by the City Attorney, to effectuate the transaction - Not to exceed $29,399,487.00 - Financing: Downtown Connection TIF District Fund (subject to current and annual appropriations from tax increments)
Body
BACKGROUND
In 2005, the Downtown Connection TIF District was initiated by property owner petition and created by City Council to serve as a long-term funding tool for public capital investment in the core of downtown and to support redevelopment of vacant/historic buildings and underutilized/vacant surface parking lots.
On June 22, 2022, the City Council approved an amendment of the Zone’s Plan by Ordinance No. 32249 to support the significant investment in public infrastructure, such as roadways, water, sewer, storm drainage, sidewalks, lighting, mixed-income housing, etc. required to facilitate high-density redevelopment of vacant and underutilized parcels and buildings in the TIF District. A key component of the June 2022 Plan amendment was the addition of a Public Safety Building line item to the budget of each sub-district in the Zone. Funding capacity in each sub-district’s budget was allocated to this line item to support the replacement of two antiquated Dallas Fire Rescue stations downtown, Fire Station No. 18 in the Downtown Connection Sub-district and Fire Station No. 4 in the Newpark Sub-district.
Fire Station No. 18 is addressed as 660 North Griffin Street and is approximately 12,330 square feet. The station was constructed in 1975, and now the facility is functionally obsolete and beyond its useful life. The station does not adequately address current and future fire safety needs of existing and planned development in downtown Dallas. Current conditions at the station include increased maintenance and repair requests for issues with the electrical system, heating, ventilation, and air conditioning, plumbing and overhead doors, emergency vehicle access to the station’s apparatus bays only by backing into them from Griffin Street, open sleeping areas that do not provide any privacy, restrooms and showers that are co-located without any gender separation and laundry and workout areas located in apparatus bays. The City’s current budget and 2024 Bond Program did not allocate any funding to the renovation or replacement of the existing Fire Station No. 18.
To replace Fire Station No. 18, the City has been negotiating with the Developer for several years and now desires to enter into a public/private partnership with the Developer to use TIF District funds generated in the Downtown Connection Sub-district to reimburse costs to deliver a new fire station and acquire the property upon which the new facility will be constructed. Specifically, the Developer will design, finance, and construct the new Fire Station No. 18 (“Project”) on its three vacant properties totaling approximately 0.967 acres (42,109 square feet) and addressed as 1205 Patterson Avenue, 1212 San Jacinto Street, and 1214 San Jacinto Street (“Project Site”) in the Zone. The Project Site is located one block away from the existing Fire Station No. 18.
The proposed facility will be approximately 23,000 square feet and will provide functional space that does not exist at the current station such as private sleeping rooms and accompanying showers and restrooms, a decontamination area for cleaning and disinfecting emergency medical equipment, and an area for cleaning personnel protective equipment that is properly ventilated with lighting and drainage. The proposed facility will also provide office and living quarter space and at least 4 pull-through bays for fire apparatus storage, nearly doubling the fire apparatus storage capacity of the existing Fire Station No. 18. As part of the Project, the Developer will install streetscape improvements along the Project Site, will install off-site infrastructure improvements to extend utilities to the Project Site, and will upgrade two traffic signals as requested by Dallas Fire Rescue.
The estimated total Project cost, including costs expended to-date, is approximately $29,399,487.00, comprised of the following components: (i) hard construction costs of approximately $19,576,845.00; (ii) soft costs of approximately $9,545,952.00 (including approximately $954,151.00 in developer fee and approximately $4,194,858.00 in financing costs); and (iii) the difference in appraised value of $276,690.00 between the City’s property and Project Site.
The TIF Subsidy shall be payable upon completion of the Project, upon Developer’s satisfaction of all terms and conditions of the development agreement, and in accordance with the TIF District Increment Allocation Policy. Project costs may only be reimbursed upon completion of the Project and a post-construction audit conducted by the City which includes the review and approval of all receipts, documentation, and invoices.
The TIF Subsidy includes reimbursement of costs (actual expenditures) of building design, engineering and construction which include costs of required utility improvements, building fixtures, off-site public improvements, and construction management; reimbursement of actual expenditures for streetscape improvements which may include, but are not limited to sidewalk construction, street/pedestrian lighting and landscaping; the difference in the appraised values for the Project Site and the City property; and financing costs, including interest, which shall not exceed $4,195,000.00.
Upon completion and City acceptance of the newly constructed facility, Developer and City shall effectuate a real estate transaction whereby the City shall acquire the Project and Project Site, and the Developer shall simultaneously acquire the City’s property (current location of Fire Station No. 18) through a direct land sale by the City. Pursuant to state law, the City is permitted to directly lease or sell City-owned/City-controlled property without complying with auction and bidding requirements with the condition that the property is located within a reinvestment zone and redeveloped in accordance with the zone’s project plan and reinvestment zone financing plan.
The City that finds the direct sale of the City-owned property addressed as 660 North Griffin Street (including existing Fire Station No. 18) to the Developer for the purpose of relocating and constructing a new Fire Station No. 18 facility is in accordance with the Project Plan and Reinvestment Zone Financing Plan of the Downtown Connection TIF District.
ESTIMATED SCHEDULE OF PROJECT
Start Construction December 2026
Complete Construction December 2028
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
On June 8, 2005, the City Council authorized the establishment of the Downtown Connection TIF District by Resolution No. 05-1779; Ordinance No. 26020, as amended.
On August 29, 2005, the City Council authorized the Project Plan and Reinvestment Zone Financing Plan (“Plan”) for the Downtown Connection TIF District by Resolution No. 05-2544; Ordinance No. 26096, as amended.
On April 1, 2025, the Downtown Connection TIF District Board of Directors recommended approval of a development agreement with Tango North RF, LLC, a Texas limited liability company and/or its affiliates in an amount not to exceed $29,399,487, payable from existing and future TIF District funds, for the Fire Station No. 18 Relocation Project including (a) City’s acquisition from Developer of three properties addressed as 1205 Patterson Avenue, 1212 San Jacinto Street, and 1214 San Jacinto Street totaling approximately 0.967 acres (the property on which the future Fire Station No. 18 will be located); (b) City’s direct sale to Developer of an approximately 1.09 acre property addressed as 660 N. Griffin Street (the property on which the existing Fire Station No. 18 is located); and (c) reimbursement of development costs associated with Developer’s design, engineering, financing, construction, and conveyance to the City of a new Fire Station No. 18 facility (and associated infrastructure and streetscape improvements).
The Economic Development Committee was briefed by memorandum regarding this matter on April 7, 2025. <https://cityofdallas.legistar.com/View.ashx?M=F&ID=13705678&GUID=66477A18-F821-499E-9AA2-90F4D0A3557D>
FISCAL INFORMATION
|
Fund |
FY 2025 |
FY 2026 |
Future Years |
|
Downtown Connection TIF District Fund |
$0.00 |
$0.00 |
$29,399,487.00 |
DEVELOPER/EXECUTIVE
Tango North RF, LLC
Michael Tregoning, Manager
MAP
Attached