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County remains undecided on joining TIRZ

February 20, 2019 GMT

Ector County Commissioners say they have mixed feelings about contributing tax dollars to an economic development zone for downtown Odessa.

Ector County is the last taxing entity left to decide on whether or not to participate in the City of Odessa’s Tax Increment Reinvestment Zone. The Ector County Hospital District and Odessa College have each approved their participation in the TIRZ and Ector County Independent School District cannot participate by law.

A TIRZ is a way for taxing entities to pay for public improvements such as deteriorating structures or inadequate sidewalk layout to increase accessibility or usefulness of the area.

Property tax revenues within a defined area are frozen at a base level for 20 years and any tax increment collected above the determined baseline from captured appraisal value would then go into the TIRZ to pay for public improvement projects.

Odessa City Council approved establishing a TIRZ from Second Street to Eighth Street and Adams Avenue to Bernice Avenue.

“You’re not giving up any money that you have, you’re giving up potential property value increase,” City Development Services Manager Vanessa Shrauner said. “The baseline is set at 2018 rates so whatever the county, the city, the hospital and the college collected at the end of 2018 they will continue to collect that amount for the life of the TIRZ. The TIRZ is only funded if the value of property located within that boundary increases and then the increase is what funds the TIRZ.”

Shrauner said if the county chooses to participate in the TIRZ they could join the other taxing entities in having a say on what areas are addressed.

“A board decides what projects get funded and if you join the TIRZ you get a place on that board,” she said.

The Commissioners’ Court has yet to put the item to a vote months after City Manager Michael Marrero and Travis James, vice president of TXP, presented the Court with information and urged them to consider pitching in to support with redevelopment of downtown.

Ector County Judge Debi Hays said she had reservations about joining the TIRZ because she felt the county has a lot to catch up on.

“I don’t know that we could sell that to the people that have got holes in their roads or to department managers with equipment that is 15 years old.”

Precinct 2 Commissioner Greg Simmons previously said during a meeting that county residents are more likely to be focused on issues with roads and law enforcement than with downtown renovations.

Shrauner said the city wants commissioners to take their time and be sure about what they’re joining or not joining and make the best decision for the county.

“But to get everybody within the first year would be optimal,” Shrauner said, “it’s not negative or anything like that it’s just cleaner.”

Hays said residents would gain a better downtown area if the TIRZ spurs development and upgrades infrastructure, but the county would mostly be helping the city facilitate their goals if they chose to participate. Simmons echoed the judge’s view and added that the TIRZ does benefit the community as a whole.

Simmons said the Court has not discussed the issue since the presentation in November. He said commissioners may be hesitant to commit dollars at this point until further assessment of the county’s overall financial condition with the added sales tax revenue is better understood.

County voters approved levying a sales tax of 1.25 cents per dollar and creating an assistance district in all of Ector County outside the city limits of Odessa and Goldsmith during the last election cycle. Sales tax collection is set to begin in April and could generate an additional $12-$15 million in annual revenue for the county’s budget.

Simmons said the county has plans to address residents’ needs and determining whether or not contributing to the TIRZ does that will require hashing out the details.

“We’re in a wait and see mode,” Simmons said.