STRATEGIC PRIORITY: Economic and Neighborhood Vitality
AGENDA DATE: January 22, 2020
COUNCIL DISTRICT(S): 10
DEPARTMENT: Department of Housing & Neighborhood Revitalization
EXECUTIVE: Michael Mendoza
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SUBJECT
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Authorize a resolution (1) designating approximately 1,595 acres of property generally bounded by Lyndon B. Johnson (LBJ) Freeway, Abrams Road, Audelia Road, Forest Lane, Greenville Avenue, Royal Lane, and Cottonwood Creek in the LBJ/Skillman area of Dallas, Texas as City of Dallas Neighborhood Empowerment Zone No. 11 (NEZ No. 11), pursuant to Chapter 378 of the Texas Local Government Code, to promote the creation or rehabilitation of affordable housing in the zone, establish boundaries of the zone, and provide for an effective date; (2) declaring that projects located within NEZ No. 11, within the Skillman Corridor Tax Increment Financing District, and eligible for the City’s Residential Neighborhood Empowerment Zone (NEZ) Program may utilize real property and business personal property tax abatements under the provisions of the Residential NEZ Program; and (3) authorizing the City Manager to execute individual tax abatement agreements and development grant agreements in amounts equal to development fees and certain development-related costs up to $50,000.00 in accordance with the Residential NEZ Program - Financing: This action has no cost consideration to the City (see Fiscal Information)
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BACKGROUND
Chapter 378 of the Texas Local Government Code (the Act) provides for the creation of NEZs. A NEZ is a flexible tool that a municipality can utilize to implement an economic development program, to create or rehabilitate affordable housing in the zone, and to increase the quality of social services, education or public safety provided to the residents of the zone.
With this item, staff is proposing to create City of Dallas NEZ No. 11 for a geographic area approximately 1,595 acres in size generally bounded by LBJ Freeway, Abrams Road, Audelia Road, Forest Lane, Greenville Avenue, Royal Lane, and Cottonwood Creek in the LBJ/Skillman area of Dallas. The area is comprised mostly of single-family homes, townhomes, and condominium communities. Most of the area is Market Value Analysis Category D, E, or H.
NEZ No. 11 includes areas within the LBJ Skillman stabilization area as well as the adjacent Hamilton Park, Stultz Road, and Chimney Hill neighborhoods that may be considered areas at risk of displacement and that include properties likely to be eligible for the Residential NEZ Program. The boundary specifically excludes the Texas Instruments campus.
A companion item on the current Council agenda proposes to amend the Comprehensive Housing Policy (CHP) to create a Residential NEZ Program which would provide for a tax abatement and grants in amounts equal to development fees and certain development-related costs for (1) new construction of single-family homes or duplexes that are sold or rented to eligible households, or new construction of multifamily dwelling units that are sold to eligible households, on lots that are either currently vacant, subject to an order of demolition under Chapter 27 or purchased through the City’s Land Bank or Land Transfer programs; (2) renovation of owner-occupied housing units; and (3) renovation, code compliance, and guaranteed affordability for rental single-family and duplex housing units.
A small portion of the proposed boundary lies within the Skillman Corridor Tax Increment Financing (TIF) District. Section 311.0125 of the Texas Tax Code requires that tax abatements within TIF districts be approved by the board of directors of the TIF district and the governing body of each participating taxing jurisdiction.
The Board of Directors of the Skillman Corridor TIF District and the Dallas County Commissioners Court are each anticipated to review a formal request for approval of tax abatements up to $50,000.00 per abatement that comply with the Residential NEZ Program and are within the Skillman Corridor TIF District. The TIF Board will review an amendment to the increment allocation policy if necessary. This item recommends that City Council also specifically approve such abatements within the TIF district and authorize the City Manager to execute tax abatement agreements for projects eligible for the Residential NEZ Program in the proposed NEZ, including those within the TIF district, up to $50,000.00 per abatement.
City Council approval of this item will approve the creation of the NEZ and authorize the City Manager to execute tax abatement agreements up to $50,000.00 each, including within the Skillman Corridor TIF District.
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
On May 9, 2018, City Council adopted the CHP and created the Dallas Housing Policy Task Force by Resolution No. 18-0704, as amended.
On November 28, 2018, City Council authorized amendments to the CHP, to make technical changes to the Home Improvement and Preservation Program (HIPP), the Dallas Homebuyer Assistance Program (DHAP), and the New Construction and Substantial Rehabilitation Program by Resolution No. 18-1680.
On May 22, 2019, City Council authorized a resolution in furtherance of the City of Dallas’ efforts to support diverse racial, ethnic, cultural, and socio-economic backgrounds and to promote equity in the Dallas community by Resolution No. 19-0804.
On May 22, 2019, City Council authorized an amendment to the CHP to add a Land Transfer Program to incentivize the development of quality, sustainable housing that is affordable to the residents of the City and the development of other uses that complement the City’s CHP, economic development policy, or redevelopment policy by Resolution No. 19-0824.
On June 12, 2019, City Council authorized amendments to the CHP to amend and restate the low-income Housing Tax Credit policy by Resolution No. 19-0884.
On June 26, 2019, City Council authorized amendments to the CHP to amend the DHAP, the HIPP Homeowner Program, and the HIPP Landlord Program by Resolution No. 19-1041.
On September 25, 2019, City Council authorized amendments to the CHP to create the Title Clearing and Clouded Title Prevention Pilot Program by Resolution No. 19-1498.
City Council will be briefed regarding this matter on January 15, 2020.
FISCAL INFORMATION
This action has no cost consideration to the City. A separate item will be presented, concurrently, that outlines the costs associated with the implementation of the tax abatements and development agreements.