ustxtxb_obs_1991_07_12_50_00009-00000_000.pdf

Imminent Destruction The fight over Allen Parkway Village isn’t just about 1,000 units of public housing. As Fourth Ward Martha Whiting points out its about the future of the Fourth Ward in Houston. American General Corp. and its partner Cullen Inter ests want to buy the APV property to fill out a broader development scheme called “Founders Park,” that would “redevelop” the Fourth Wai .d, and part of the Montrose neighborhood to the -The resources for accomplishing this transformation cannot come exclusively from private sources,” declares the Founders Park project summary. The developers propose that the city create a controversial mechanism called a Tax Increment Finance project. TIFDs generate capital for development by establishing a freeze on property tax revenues for the county and the local school district, and then giving all future increases in tax revenues tax revenues generated from increased development, as well as routine increases in revenues due to the effects of inflation on real estate. TIFDs also have, with the approval of the city council, the povver of eminent domain. A Founders Park planning document says eminent domain will only be used to acquire rightof-way for roadways, etc., and when “other parcels on a particular development site have been assembled and a holdout makes it impossible to move forward with the plan.” TIFDs have not yet been widely used in Houston, although several have recently been proposed in addition to the one for Founders Park. In Galveston there are 10 TIFDs, all of which are mired in lawsuits with the Galveston Independent School District. Ed Schwab, an attorney for GISD, said of TIFDs, “our experience down here has been a nightmare.” One Galveston TIFD spent $5.5 million on public works. Now he says. “the thing has gone kaput.” The $5.5 million has turned into $9 million, including interest, and not enough development has occured to even pay the debt service. Meanwhile, GISD loses not only the tax revenues from any future development, but also from normal inflation, said Schwab. The city of Bellaire, an upper-income community in Harris County, created a TIFD to finance street and utility repair and landscaping. Ultimately, Bellaire sued Harris County for to it Houston Post columnist Kate Thomas has penned several stern polemics against TIFDs in the past year. Thomas said “it’s reasonable to ask why Bellaire can’t just raise its own taxes to pay for downtown street and landscaping im provements. That’s what city governments are for But then wbyshouldtheyif they can get the i money from HISD and Harris County instead for the next 20 years?” Thomas questions the fiscal wisdom of politicians who tout TIFDs: -While these districts are In Galveston there are 10 l’IFDs, all of which are mired in lawsuits with the Galveston Independent School District. wrapped in the flag of economic redevelopment, they beg the question of how the county, the city and the school district will replace the lost revenue. It’s easily answered, however; they just raise taxes.” While the long-term effects of TIFDs will provide headaches enough for future taxpayers, in the context of the Fourth Ward the effects PATRICIA MOORE would be much more immediate. In the last legislative session, far-ranging changes in TIFD legislation included the removal of the statutory requirement that the district be zoned no more than 10-percent residential. \(According to press accounts, then-State Senator Craig The establishment of a TIFD in the Fourth Ward would provide a mechanism \(eminent Arid, unless the project went belly up like the one described in Galveston, the district would provide the developers with the financing they need to build an upper-income residential area for the white-collared, white-skinned professionals who work downtown. The 1989 amendment to TIFD law, installed by then state senator Craig Washington, that provides that one-third of TIFD money will go to low-income housing, will not help the short-run problems created by dislodging the more than 5,000 residents of the Fourth VVards. Destroying these people’s homes and casting them into homelessness would be an unconscionable tragedy. Doing it with taxpayers’ money would be an even greater disgrace. Whether a TIFD works well and the Fourth Ward becomes gentrified, or it goes bankrupt and taxpayers pick up the tab, its hard to see how its creation would be in the short or longterm best interest for the people who currently live there. S.H. Fourth Ward residents would lose their homes if the city creates a TIFD THE TEXAS OBSERVER 9