economyEconomic Development

Chapter 311 Frequently Asked Questions

What are the requirements for a reinvestment zone for tax increment financing?

A reinvestment zone may not be created if one of the following conditions is met:

  1. More than 10 percent of the property within the reinvestment zone (excluding publicly-owned property) may be used for residential purposes. This requirement does not apply if the district is created pursuant to a petition of the landowners; or
  2. The proposed reinvestment zone and existing reinvestment zones contains property that cumulatively would exceed either:
    1. 15 percent of the total appraised value of taxable real property within the city and its industrial districts, or
    2. 20 percent of the total appraised value of taxable real property within the city and its industrial districts if the city is the county seat of a county that is adjacent to Harris County and is a planned community of 20,000 or more acres of land originally established under the Urban Growth and New Community Development Act and is subject to specified restrictive covenants; or
  3. The reinvestment zone would contain more than 15 percent of the total appraised value of real property taxable by a county or school district.
What notices are required in order to implement a tax increment financing zone?

The local government creating the zone must provide a written notice of its intent to designate a reinvestment zone to the other taxing units that levy property taxes within the area at least 60 days before the public hearing. The notice must contain a description of the proposed boundaries of the zone, the tentative plans for the zone's development, and an estimate of the general impact of the zone on property values and tax revenues.

Is there a public hearing requirement for creating a tax increment financing zone?

Yes; the local government creating the zone must publish notice of a public hearing at least seven days in advance of the hearing in a newspaper of general circulation in the city or county creating the zone. At the hearing the city or county must explain the proposed benefits of the zone. Any interested person is permitted to speak at the hearing. Owners of property that are located within a proposed zone must be given a reasonable opportunity to object to the inclusion of their property within the proposed zone.

What is included in the project plan?

After the city or county has adopted the ordinance or order creating the zone, the board of directors of the zone must prepare both a project plan and a reinvestment zone financing plan. The plans must be as consistent as possible with the preliminary plans the city developed for the zone before the board was created. Specifically, the project plan must include:

  1. a map showing existing uses and condition of real property within the zone and any proposed improvements to and proposed uses of the property;
  2. any proposed changes to zoning ordinances, the master plan of the city, building codes or other municipal ordinances;
  3. a list of estimated non-project costs; and
  4. a statement of the method for relocating persons who will be displaced as a result of implementing the plan.
What information is required to be reported to the Comptroller's office?

According to Texas Tax Code, Section 311.016 and 311.019 certain information is required to be sent to the Comptroller's office. For more information on what is to be report please visit our reporting forms section.

Need Help?

For additional information, contact the Data Analysis and Transparency Division via email or at 800-531-5441, ext. 3-4679, or 512-463-4679.

Disclaimer

This information should not be construed as, and is not a substitute for, legal advice.

Property owners and school districts are urged to consult the Attorney General's Economic Development Handbook and their own legal counsel for any questions or interpretations of economic development laws.