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HomeMy WebLinkAboutTIF1 2013-04-22 AgendasREINVESTMENT ZONE NUMBER 1, CITY OF NORTH RICHLAND HILLS BOARD OF DIRECTORS MEETING NORTH RICHLAND HILLS CITY COUNCIL WORKROOM 7301 NORTHEAST LOOP 820 NORTH RICHLAND HILLS, TX 76180 MONDAY, APRIL 22, 2013 4:00 P.M. AGENDA 1. Call to Order 2. Approval of October 13, 2009 Board Minutes 3. Appointment of Vice -Chair and Secretary 4. Discuss and Approve TIF No. 1 and TIF No. 1A 2012 Annual Reports 5. Update on TIF No. 1 Expansion Projects. This is an information item only. No Board action is required. 6. Adjournment MINUTES OF THE TIF BOARD MEETING FOR REINVESTMENT ZONE #1 OF THE CITY OF NORTH RICHLAND HILLS, TEXAS BOARD OF DIRECTORS MEETING - PRE -COUNCIL ROOM AT CITY HALL TUESDAY, OCTOBER 13, 2009 - 4:00 P.M. Present: Oscar Trevino, Chairman Scott Turnage John Lewis Tim Welch David Whitson Drenda Witt Dolores Webb Dr. Larry Darlage Carolyn Sims Others Present: Mark Hindman Karen Bostic Jimmy Perdue Mike Curtis Vickie Loftice Larry Koonce John Pitstick Elizabeth Reining Craig Hulse Mary Peters Dr. Quentin Burnett Mayor Mayor Pro Tern Council Member Council Member Council Member Tarrant County Hospital District Birdville I.S.D. Tarrant County College Precinct Administrator for Commissioner Gary Fickes, Northeast SubCourthouse, Precinct #3 City Manager Assistant City Manager Assistant City Manager Managing Director of Development Services Interim Managing Director of Community Services Director of Finance Director of Planning & Development Assistant to the City Manager Director of Economic Development Public Information Officer Birdville I.S.D. 1. CALL TO ORDER Mayor Trevino called the meeting to order at 4:00 p.m. 2. APPROVAL OF NOVEMBER 6, 2008 BOARD MINUTES Dolores Webb moved to approve the minutes. Dr. Larry Darlage seconded the motion. Motion to approve carried 9-0. 3. APPOINTMENT OF VICE -CHAIR AND SECRETARY Dr. Larry Darlage nominated Dolores Webb to serve as Vice Chairman. Drenda Witt seconded the motion. Motion to approve carried 9-0. Drenda Witt nominated Dr. Larry Darlage to serve as Secretary. Dolores Webb seconded the motion. Motion to approve carried 9-0. 4. DISCUSS AND APPROVE TIF NO. 1 2009 ANNUAL REPORT Finance Director Larry Koonce provided an overview of TIF No. 1 Annual Report. Taxes in the amount of $224,455 were received from property owners in fiscal year 2009. Outstanding principal and interest on the Certificates totaled $457,117 and principal interest and associated payments totaled $59,467 for fiscal year 2009. The end of the year cash balance is estimated at $1,081,374. Each one of the taxing entities has approved their agreement to participate in the expansion (TIF No. 1A). In December the City of North Richland Hills will be issuing $4.5 million dollars in certificates of obligation debt for the projects in the expansion plan. Councilman Turnage moved to approve TIF No. 1 2009 Annual Report. Councilman Whitson seconded the motion. Motion to approve carried 9-0. 4. Consider a resolution of the Board of Directors of Reinvestment Zone Number 1 City of North Richland Hills adoption certain amendments to the financing plan for Reinvestment Zone Number 1, City of North Richland Hills, and authorizing and approving other matters incidental and related thereto Finance Director Larry Koonce presented the amended financing plan for expansion of TIF No. 1. The original plan anticipated 100% participation from all entities. TCC has agreed to 50% participation. The amended plan is based on the new participation percentages. The estimated tax revenues in the original plan were $4.2 million with the amended plan estimated at $3.5 million. Reasons for the decrease include the level of participation, a couple of entities slightly decreased their tax rates in 2010 lowering the property tax revenues and Tarrant Appraisal District roll indicated $146,915 in captured evaluation as compared to $3,000,000 estimated in the approved plan. The first year's growth is less and subsequent year's growth has been slowed on the amended plan. The total value growth is still estimated at $30,000,000. Another change was made on the estimated debt payments. The original interest rates on the bonds were estimated at 5%. This has been reduced to $3.85%. The difference in terms of the overall cash flow coverage of the original plan changed from approximately $500,000 to approximately $3,000 in the amended plan. Mr. Koonce noted the total at the bottom of the page for The Estimated Investment Earnings on Construction Funds is for fiscal year 2011 based on a 1 % earning. Dolores Webb moved to approve Resolution 2009-001 as presented. Carolyn Sims seconded the motion. Councilman Lewis summarized the amended plan stating the TIF had approximately $1,081,000 in house with estimated revenues of $3,542,000 for a total of $4,623,000. The TIF will have a positive cash flow with the anticipated debt in spending of $4,132,000. Motion to approve carried 9-0. 5. Update on TIF No. 1 Expansion Projects Director of Planning & Development, John Pitstick presented an update on the projects. He recognized Lisa McMillan and Carolyn Sims for their work in getting the approval of the expansion plan. Within the existing boundaries of 95 acres there are 700 to 800 jobs and revenues have increased from $1,000,000 to approximately $15 million with half coming from the TIF and the other half from non-TIF revenues going directly to the taxing entities. Mr. Pitstick presented an area map outlining the TIF expansion area in relation to BISD, the JPS Clinic, Tarrant County Sub -courthouse, and Tarrant County College campus. The City is working with Richland Hills in the proposed redeveloped area. The map shows all proposed commercial tracts south of Loop 820 with the exception of the hospital and old mall property included in the TIF boundary. A significant amount of dollars improving water, sewer, and streets in the redevelopment area has been spent by the City. The plan proposes $3,500,000 in public improvement with $30,000,000 in projected growth over the next nine years. The expansion is limited to nine years. The City proposes to connect existing businesses to underground services and work with Richland Hills to make intersection improvements at Glenview and Rufe Snow on Boulevard 26. The City has been working with TXDOT to remove a section south of Loop 820 to State Highway 10 from the state highway system to be able to make improvements. North Richland Hills will take full responsibility of maintaining the section. The City is also meeting with ONCOR in coordinating the burial of overhead utilities lines. Mayor Trevino recognized BISD for supporting the TIF. The neighborhood revitalization of the south side of North Richland Hills is critical. He recognized the two good elementary schools which should draw young families to move in to the area. The City spent approximately $800,000 of CIP money concentrated into a neighborhood in the area and also has CDBG money being spent on neighborhoods. Some of the budget this year includes making a semi -community center out of Food Line building. It also includes some major amenities at Rufe Snow and Glenview to enhance the look in the area and to make it safer and a more viable commercial corridor. The goal is to develop an area to attract young families instead of homes becoming rental property. The City has an agreement with Richland Hills for $500,000 in intersection improvements freeing up money do more neighborhood revitalization. Dolores Webb asked if there were any reason TXDOT would not want to give up the section the City has requested to be removed from the state highway system. Mayor Trevino answered TXDOT was not supportive of the beautification improvements proposed which do not fit their criteria. Mike Curtis stated TXDOT is in support of turning this section over to City. Mayor Trevino added the City already maintains traffic signalizations at the intersections. 6. ADJOURNMENT Mayor Trevino adjourned the meeting at 4:28 p.m. TIF No. 1 Subject: Appointment of Vice -Chair and Secretary Board Meeting Date: 4/22/2013 Agenda Number: 2013-01 The Board will appoint a Vice -Chairman and Secretary for a two (2) year term. Current officers are Vice -Chairman, Dolores Webb and Secretary, Dr. Larry Darlage. Recommendation: To appoint the Vice -Chair and Secretary. TIF No. 1 Subject: Discuss and Approve TIF No. 1 and TIF No. 1A Board Meeting Date 2012 Annual Report 4/22/2013 Agenda Number: 2013-02 Larry Koonce, Director of Finance City of North Richland Hills will present the attached executive summary and annual report for fiscal year ended September 30, 2012. The annual reports have been submitted to the State Comptroller as required. After the presentation of financial status of TIF No. 1 and TIF No. 1A, we recommend the Board take action as to the acceptance of the report. NRH CITY OF NORTH RICHLAND HILLS MEMO TO: Mayor and City Council FROM: Larry Koonce, Director of Finance SUBJECT: Tax Increment Reinvestment Zone No. 1 and 1A Executive Summary Annual Report September 30, 2012 DATE: April 22, 2013 Attached for your information are Tax Increment Reinvestment Zone No. 1 and 1A Annual Reports for the Year Ended September 30, 2012. TIF No. 1 TIF No: 1 was created by the City of North Richland Hills in 1998. The TIF was created to provide public drainage improvements around the 300,000 square foot Richland Plaza Shopping Center. The shopping center had declined to the point that nearly all tenants had vacated, and total values were a little over $1 million. It was believed that unless public drainage improvements were made to divert flooding from the Richland Plaza parking lot to Mackey Creek, the development was destined to further decay and decline. At the time the TIF No. 1 was created, the City of NRH, Birdville Independent School District, Tarrant County, Tarrant County College, and Tarrant County Hospital District all agreed to participate at 100% for the life of the TIF. Certificates of Obligation were sold in the amount of $850,000 for the TIF portion of the $1.3 million public drainage project (the balance was paid by the City of NRH). The TIF debt has a maturity of twenty years to 2018. The Certificates were issued in 1998 and the public drainage improvements were completed in fiscal year 2000. In fiscal year 2012, the TIF No. 1 received taxes in the amount of $249,114 from property owners. For the year ended September 30, 2012, outstanding principal and interest on the Certificates totaled $284,251. Principal, interest and associated payments totaled $57,274 for fiscal year 2012, and the end of the year cash balance was $1,752,010. The Hills, a 300,000 square foot business center in the southernmost part of North Richland Hills, includes all of the taxable property in the TIF. The captured appraised value of all the property in TIF1 for FY 2012 was $10,458,783. The captured appraised value of all the property in TIF1 for FY 2013 as of February 2013 was $13,429,571. This was a one year increase of $2,970,788 or 28%. Taxes billed to participating entities for FY 2013 totaled $355,329. TIF 1A In November 2008 the City of North Richland Hills expanded TIF 1. The boundaries of the expansion of TIF 1 included all commercial properties in the Boulevard 26 corridor area (except North Hills Hospital and Calloway Creek property) from the southern City limits to Loop 820. The expanded zone encompasses approximately 392 acres, with a 2008 base value of real property of $83.7 million. The TIF 1 expansion (TIF 1A) will legally expire in 2018, concurrent with the original TIF. The incremental growth in value of property within the expanded area at the time of creation was estimated to be $30 million over 10 years. This project includes the burying of existing above ground utility lines on the North Richland Hills side of Boulevard 26 between Glenview and Rufe Snow. This project will also consist of constructing street and related landscape and streetscape improvements at the intersections of Rufe Snow Drive and Boulevard 26, and Glenview Drive and Boulevard 26. In 2010 The City of North Richland Hills issued certificates of obligation in the amount of $1,000,000 towards these projects. Project expenditures in the amount of $28,460 were incurred in FY 2012. Property Values within the TIF1A boundary declined by about $1.4 million in 2011 (fiscal year 2012). The taxable value for tax year 2011 was $74.7 million or nearly a $9 million loss in value since 2008. Because no incremental value has been realized, $0 property tax dollars were collected in FY 2012 or have been collected since the district was expanded in 2008. For the year ended September 30, 2012, outstanding principal and interest on the Certificates totaled $846,919. Property Values within the TIF1A boundary declined by about $3 million in 2012 (fiscal year 2013). The taxable value for tax year 2012 was $71.7 million or nearly a $12 million loss in value since 2008. Taxes billed to participating entities for FY 2013 totaled $0. Fortunately, when TIF 1A was created the City was able to incorporate the existing balances and future tax revenues to be collected from TIF1 to pay for TIF 1A projects. In 2008 the combined TIFs began with over $1 million cash from net operations of TIF1 since 1999. TIF1 also produces net revenues over expenditures of nearly $200,000 annually. Combined Cash from TIF1 and TIF1A available to make existing debt payments for TIF1 and TIF1A and project expenditures for TIF1A totaled $2,220,276 at September 30, 2012. In view of the decline in property values in the expanded TIF area, it is estimated that sufficient revenues will not be produced to meet the debt service for the original $3.5 million project plan. Based on projected combined TIF tax revenues through the expiration of the TIFs in 2018, it is estimated that a maximum of $2.5 to $3 million in projects could be funded. In 2010, bonds in the amount of $1 million were sold for TIF 1A projects. Based on the total $2.5 to $3 million capacity, $1.5 to $2 million in additional debt could be issued. Larry Koor�'ce Director of Finance Attachments: TIRZ No.1 Annual Report FY 2012 TIRZ No.1A Annual Report FY 2012 City of North Richland Hills Tax Increment Reinvestment Zone No. 1 Annual Report Year Ended September 30, 2012 Amount & Source of Revenue in the Tax Increment Fund FY 2012: Property Tax Revenues $ 249,114 Investment Income $ 6,578 Total Revenues in Fiscal Year 2012 $ 255,692 Amount and Purpose of Expenditures of the Fund FY 2012: Principal, Interest, Issuance & Paying Agent Payments on Certificate Indebtedness Total Fund Expenditures in Fiscal Year 2012 $ 57,274 $ 57,274 Principal & Interest due on outstanding indebtedness as of September 30, 2012: Principal Outstanding $ 255,000 Interest Outstanding $ 29,251 Total Principal & Interest Outstanding 9-30- 2012 $ 284,251 Captured Appraised Value shared by the Municipality & Other Taxing Entities and total amount of tax increments received : Taxing Unit 1998 Base Year Appraised Value Taxable Value 2011 Captured Appraised Value 2011 Tax Rate/$100 FY 2012 Tax Revenue Billed FY 2012 City of North Richland Hills $1,152,929 $11,611,712 $10,458,783 $0.570000 $59,615 Birdville I.S.D. $1,152,929 $11,611,712 $10,458,783 $1.435000 $150,084 Tarrant County $1,152,929 $11,611,712 $10,458,783 $0.264000 $27,611 Tarrant County Hospital District $1,152,929 $11,611,712 $10,458,783 $0.227897 $23,835 Tarrant County College $1,152,929 $11,611,712 $10,458,783 $0.148970 $15,580 Tax Revenues Outstanding Total Tax Revenues Collected This report submitted by : isrNA /1A10 k :n]i/L Larry Koo �� Director of Finance City of North Richland Hills, Texas $276,725 ($27,611) $249,114 K:acct\tifs\TIF1 Annual Report 2012 City of North Richland Hills Tax Increment Reinvestment Zone No. 1A Annual Report Year Ended September 30, 2012 Amount & Source of Revenue in the Tax Increment Fund FY 2012: Property Tax Revenues $ - Investment Income $ 417 Total Revenues in Fiscal Year 2012 $ 417 Amount and Purpose of Expenditures of the Fund FY 2012: TIF 1A Project Expenditures $ 28,460 Principal, Interest, Issuance & Paying Agent Payments on Certificate Indebtedness $ 143,263 Total Fund Expenditures in Fiscal Year 2012 $ 171,723 Principal & Interest due on outstanding indebtedness as of September 30, 2012: Principal Outstanding $ 770,000 Interest Outstanding $ 76,919 Total Principal & Interest Outstanding 9-30- 2012 $ 846,919 Captured Appraised Value shared by the Municipality & Other Taxing Entities and total amount of tax increments received : Captured 2008 Base Year Taxable Value Taxable Taxing Unit Taxable Value 2011 Value 2011 City of North Richland Hills $83,563,510 Tarrant County $83,682,685 Tarrant County Hospital District $83,682,685 Tarrant County College $83,689,685 Tax Revenues Outstanding Total Tax Revenues Collected This report submitted b // 1 Larry KoonVe Director of Finance City of North Richland Hills, Texas K:acct\tifs\TIF1A Annual Report 2012 Tax Rate1$100 Tax Revenue FY 2012 Billed FY 2012 $74,621,290 ($8,942,220) $0.570000 $0 $74,684,819 ($8,997,866) $0.264000 $0 $74,684,819 ($8,997,866) $0.227897 $0 $74,691,819 ($8,997,866) $0.148970 $0 $0 $0 $0 TIF No. 1 Subject: Update of TIF No. 1 Expansion Public Board Meeting Date: Improvement Projects 4/22/2013 Agenda Number: 2013-03 John Pitstick, City of North Richland Hills Director of Planning and Development will present an update of public improvements within the expanded district.