HARLINGEN — The city is planning to dip into one of its three tax financing zones’ revenue to help fund a $1.6 million street project aimed at improving cargo and passenger access to Valley International Airport.
On Wednesday, officials are holding a public hearing into a proposal to expand one of the city’s three tax increment reinvestment zones to include Grimes Avenue from Loop 499 to FM 509.
As part of the proposed project, officials are planning to pull money from Zone 1, in which Grimes is located, to help Cameron County fund the roadway’s $1.6 million reconstruction and widening.
The road’s reconstruction would widen Grimes from two to four lanes from Loop 499 to FM 509, officials said.
“There’s access to the airport so it’s a benefit to the city,” City Manager Gabriel Gonzalez said Monday. “If you have cargo, you can bring it in. If you’ve got a private plane, you can bring it in. This is also where the areotropolis is located.”
As part of the deal, the city would be expected to fund about 65 percent of the project while Cameron County finances the remainder, County Administrator Pete Sepulveda said.
“We haven’t negotiated an amount yet,” he said.
‘Crucial’ project
At the airport, Director Marv Esterly said the project would help streamline cargo trucks’ and passengers’ traffic bound for the airport.
“The improvements on Grimes are a crucial part to improving access to the airport,” he said. “It will significantly improve access for passengers and truck traffic coming in with cargo. It’s going to be a better route. It will make it a lot easier to get off at 509 and then come into Grimes and on to 499.”
In Zone 1, officials are also working to develop the city’s aerotropolis across 480 acres located next to the airport.
“We’re looking for that cornerstone business that would create a snowball effect for other companies to come in,” Esterly said.
How it works
Now, Zone 1’s fund balance stands at $1 million, city records show.
Since 2016, the zone has generated the revenue.
Tax increment reinvestment zones are public financing tools used to fund economic development projects. Within the zones, properties’ assessed values are frozen based on the theory their values will increase. The increased property taxes collected make up the increment.
Background
The project would mark the first time officials dipped into tax zone revenue since 2016.
In 2016, the city’s previous administration pulled $1.6 million from the city’s three zones to help fund the purchase of eight acres of land on which sit the Harlingen Convention Center and Hilton Garden Inn.
In 2006, the city created the three zones aimed at generating property tax revenue earmarked for economic development.
From about 2010 to 2016, the city drew about $625,000 from Zone 3 to fund two projects to help develop the Harlingen Heights and Harlingen Corners business areas, officials said, adding about $380,000 has been spent on a project aimed at improving the Harlingen Corners shopping center area.
In 2012, officials used about $228,000 to improve Teege, Brazil and Bass Pro West roads as part of a project to develop the Harlingen Heights district, officials said.
In 2016, the project to build the convention center became the first for which the city’s pulled property tax revenue from all three zones.
At the time, Pete Smith, a city-contracted tax attorney in Dallas, gave officials a legal opinion stating tax law allowed the city to fund the land purchase through the three zones’ revenue because the convention center would benefit the city’s overall economy.
