The Forney City Council began the process of creating a tax increment reinvestment zone (TIRZ, also known as tax increment financing, or TIF) at Tuesday night’s meeting. The TIRZ, once created, will cover the land north of Highway 80 between CR-212 and Windmill Farms Blvd. currently known as Meadow Ridge Farms, as well as land in the same general area on the south side of Highway 80.

The property within the TIRZ on the north side of the highway is no doubt familiar to 20PM readers – this is the location of the Endeavor Real Estate Group project, Forney Marketplace, that will add 2.2 million square feet of retail space to Forney. Previous stories here on 20PM have covered potential tenants, the design of Forney Marketplace, and more – while officials are not yet ready to make any announcements regarding specific tenants, word is going around that a number of major retailers, speciality stores and grocery chains are in talks with Endeavor and Forney, and some are at the point of signing papers, so expect some exciting announcements soon.

Tax increment financing has been discussed before in the Forney discussion forum here on 20PM, but to summarize (for details, refer to this information the Texas Comptroller has published as well as this Wikipedia article), a TIRZ allows a city (as well as other taxing jurisdictions such as counties, school districts and special purpose districts, if they elect to participate) to use the increase in property tax revenue generated by the development or re-development of an area to finance some of that development. Basically, a TIRZ can issue bonds to pay for the improvement of the TIRZ and those bonds are then paid for using the increase in property tax that occurs within the TIRZ.

At this morning’s Forney EDC “Eggs, Issues and Updates” breakfast, Forney Mayor Darrell Grooms explained that Forney is very blessed to be weathering the current economic crisis very well, but that the city must capitalize on the opportunities available to it as quickly as possible because of the uncertainty present in the economy. Grooms also emphasized that the city seeks to partner with developers and retailers to bring quality growth to Forney; he has asked groups such as the Planning & Zoning commission to work as quickly and prudently as possible to ensure that the city is not the cause for any delays on this, or any other, project.

Establishing a TIRZ is a complicated process, and the city has outlined a 14-step process going forward. As part of this process, the city will hold a public hearing on the creation of the TIRZ on December 16th, 2008, during the regular city council meeting that evening. The public is encouraged to attend to learn more about the TIRZ and the exciting new developments coming to Forney.

Tax increment financing can be a controversial and contentious subject; Terrell announced last year that thye would be using the TIF process to help fund the development of Terrell Market Center, a large retail center planned near FM-148 and Spur 557. Soon after the announcement, a local Terrell blogger began railing against Terrell’s proposed TIF as a form of corporate welfare. When asked what he was said to anyone opposing this TIRZ, Mayor Grooms gave several arguments for this type of financing – most notably, he indicated that given the proximity of the Terrell project to Forney Marketplace, retailers and developers may be persuaded to take part in the Terrell project and not the Forney project if Forney does not match what Terrell is offering. Grooms also mentioned that the city is currently receiving a trivial amount of property tax revenue on this land and that in exchange for the tax increment financing arrangement, the city stands to gain significant sales tax revenue, hundreds of jobs and establish itself as a true destination city in North Texas. Finally, he mentioned that the jobs that will be created at the Forney Marketplace go beyond minimum wage, low-skill jobs and will include many managerial-level positions that will create true career opportunities for the residents of Forney.

Stay tuned for an update this afternoon, including the timeline of the TIF/TIRZ process as well as a map that defines the boundaries of the TIRZ, including the land currently outside of city limits that will be annexed into the city on November 18, 2008 so that it may be included in the TIRZ.

Update: here’s the map and the timeline mentioned above.

TIRZ Boundries

TIF/TIRZ Timeline from the City of Forney

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