HARLINGEN — Nearly $2 million in property tax revenue pulled from three business zones will help fund the $14.8 million convention center.
In a meeting yesterday, city commissioners met with boards overseeing Harlingen’s three tax increment financing reinvestment zones to draw the $1.96 million sum total to buy land on which the 43,700-square-foot convention center will be built.
By far, it’s the biggest project funded through money pulled from the zones since their creation in 2006.
Officials agreed to take $601,312 from Zone 1, $1 million from Zone 2 and $367,162 from Zone 3.
The money will be used to fund most of the $2.7 million purchase of 8 acres off Teege and Brazil roads, where the convention center and an adjacent $25 million hotel will be built in Zone 3.
The Harlingen Community Improvement Board will fund the remaining $800,000.
Tax increment reinvestment zones are public financing tools used to fund economic development projects in which properties’ assessed values are frozen based on the theory their values will increase. The increased property taxes collected make up the increment.
Pete Smith, a city-contracted tax attorney in Dallas, gave officials a legal opinion stating tax law allows the city to fund the construction project through the three zones because the convention center would benefit the city’s overall economy.
According to Smith, property tax revenue generated within the three zones could be used to buy land for the project.
In January, officials placed the convention center at the top of a list of 94 street and utility projects to be considered for funding through property tax revenues generated within those three incremental zones.
Now, it appears nearly all of the other projects on the list will wait for the tax zones to generate more revenue to help fund them.
City Manager Dan Serna has called the convention center the top “priority” project within the three tax zones.
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