PHOTO #1: A conceptual rendering provided by consulting firm Freese & Nichols as part of the downtown master plan shows an enhanced streetscape and increased business activity on Main Street. The City is establishing a tax increment reinvestment zone to promote downtown development.
The City Council on Dec. 14 approved the creation of a downtown tax increment reinvestment zone, a move that is expected to create a cycle of growth and reinvestment that will fuel the implementation of the downtown master plan.
The TIRZ is a temporary designation that local governments may use to encourage development. Instead of raising taxes or creating a new tax, the program commits a portion of property taxes from within the TIRZ to promote development within the same area.
PHOTO #2: A graph from the downtown master plan explains how a tax increment reinvestment zone works. In this scenario, 100% of revenue from new property values within the TIRZ is committed to projects inside the TIRZ boundary.
As property values increase within the TIRZ, revenue from this new property value will be set aside for downtown development. Possible uses for the funding include:
- Streetscape enhancements
- Infrastructure improvements
- Grants and incentives to encourage private development
PHOTO #3: This map shows the boundaries of the downtown tax increment reinvestment zone.
The creation of a TIRZ was identified in the recently adopted downtown master plan as a way to fund some of the projects outlined in the plan. The plan notes that a TIRZ can create a cycle of growth, with public investment encouraging private development, which adds new property value that funds further investment.
More information about the TIRZ program and other tools that could help to fund downtown development can be found in the “Implementation Strategies” section of the downtown master plan. To read the plan, visit www.victoriatx.gov/downtownmasterplan.