The newly appointed Redevelopment Authority has yet to follow through with the idea to have an “orientation” by TIRZ experts on what to expect in dealing in the world of Tax Increment Reinvestment Zones.
That is unfortunate because there is a lot of misunderstanding that is going around since a story in The Daily News (“Beachtown developer pleads for payment,” The Daily News, Jan. 18) relating the Beachtown developer as “pleading” for his money.
John Wayne Ferguson’s article did not cause the confusion.
There was no misinformation in it.
But the interpretation of the information was seriously skewed by many.
This is because of the continued stream of deliberate misinformation that has been part of the last few years of past RDAs.
Here are some simple facts to take in:
You have never paid a dime in taxes to any TIRZ.
The Galveston City Council, the Navigation District board of directors and the Galveston County Commissioners Court have never passed a tax rate that included one nickel of your tax dollars going to developers in the zones.
Each entity looked at their projected budgets, looked at their assessed values, considered their bond obligations and set their tax rates the way they have always done and the way every other government in Texas does.
The entire taxable value of each of the zones is taxed 100 percent by Galveston Independent School District and Galveston College.
And those tax dollars go to those entities. And those entities are on your tax bill.
That means that you are currently benefiting from zone development.
All of the tax dollars under discussion with TIRZ No. 13 (Beachtown) come from the property owners in Zone 13 and the increased property value in Zone 13.
The base value of the raw land, at the time of the zone’s creation, continues to be taxed 100 percent by all of the entities just as if the zone had never been developed.
The Beachtown developer wants to be paid back for municipal infrastructure he built for the city from the tax increment (taxes over those of the original land value) that was part of the deal he made with the participating governments.
That is how a zone is designed to work.
The Beachtown developer did the work.
He built the infrastructure.
But more than that, he built the infrastructure necessary for the project initially agreed to by council.
He bid out the projects as any government would have to do.
His construction was inspected by the city as any construction on Galveston Island is, he was given a certificate of completion or other documentation that said the city accepted his infrastructure into the city and he was audited by the RDA’s own chosen auditor working under the RDA’s own guidelines.
That auditor, the Zone 13 board and just plain fairness says the man needs to be paid what he is owed.
If the term of the zone ends before he is completely paid, he gets no more money.
He is at risk.
It is his development.
He should be allowed, even encouraged, to make a great development, a successful development, and one that pays him back what he is owed.
We ought to pay the man.