County active in tax zones over the years

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If Denton County climbs aboard Denton’s proposed hotel and convention center project, it will be the sixth tax-increment reinvestment zone that it has been involved with in the past 19 years.

While the county gives away some of its tax revenue with the reinvestment zones, officials say the zones can help spur growth and development, which will help the county and its cities in the long run.

“I think it’s more of a value judgment — whatever you believe in the future of that area without incentives,” county auditor James Wells said. “One thing you don’t have is a crystal ball to know what would happen if you never participated in the zone.”

County participation in tax zones dates to Jan. 1, 1995, with Texas Motor Speedway, where the county garners some taxable revenue from private condominiums around the track. In a tax-increment reinvestment zone, county officials agree to pay a certain percentage of taxable income back into the zone for a set amount of time.

The county will pay out a little more than $1.2 million this year to the existing reinvestment zones in which it participates.

The city wants the county involved in the hotel and convention center project tax zone with 13 acres of undeveloped land on University of North Texas property near Apogee Stadium, at Interstate 35E and North Texas Boulevard.

Under the proposal, a full-service Embassy Suites hotel, with about 318 rooms, and a Houlihan’s restaurant would be built. Both would be funded by O’Reilly Hotel Partners Denton and represent an investment of about $60 million. The city would fund and own the convention center, which is estimated to cost $25 million.

County Judge Mary Horn said that in the right place the tax zones can benefit everybody in increasing the viability of an area and expanding the tax base.

“I can only think of a couple instances we were asked and we turned them down,” she said.

She noted one that Little Elm brought forward several years ago. Horn said that while she understood the town’s need for improvements to its downtown area at the time, the proposal did not provide the opportunities around the proposed zone to expand the tax base for everybody.

“They had a parking garage in there, [and] I was not too interested in paying for that,” she said. “We have 43 cities, and if we built it for one, they would all want one.”

Horn pointed to a zone in west Lewisville as an example of the benefits of the zones.

“Before the TIRZ, there was just a two-lane asphalt road with cows on both sides,” Horn said. “The TIRZ provided the funding to make it a four-lane divided road and we put in the water and sewer, and immediately development took place on both sides of the road.”

Horn said she didn’t see the immediate benefit of the convention center or hotel.

“We haven’t talked about it other than when the presentation was made in Commissioners Court,” Horn said.

BJ LEWIS can be reached at 940-566-6875 and via Twitter at @BjlewisDRC.


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