Facilitating Housing for Livable Centers Incentives Tools

A total of 27 TIRZs currently operate in the City of Houston. TIRZ are created to encourage redevelopment and investment in areas of the City that would otherwise not attract sufficient market demand. (https://www.houstontx.gov/ecodev/tirz_info.html).

In 2015, TIRZs contributed $15.7 million to the City's Affordable Houston Project to fund affordable housing. The City's non-grant based affordable housing funds come from the ten petition TIRZs (because they are statutorily required to use one-third of their increment towards affordable housing).

Midtown TIRZ published it affordable housing plan in 2017. It has made numerous land purchases throughout Third Ward with an affordable housing set aside with the intent of developing 257 for-sale units and 2,504 rental units.

August 2018, City Council unanimously approved Magnolia Neighborhood Empowerment (NEZ) 1 allowed for the development of Magnolia's first mixed-use complex. Benefits include:

• Creation of affordable housing

• Increase in economic development

• Increase in the quality of social services, education or public safety

• Rehabilitation of affordable housing

The Neighborhood Empowerment Zone (NEZ) program provides for impact fee waivers for small-scale infill development projects within the boundaries of the NEZ program area. Projects that may be eligible for impact fee waivers include the following types of construction:

• New single-family residential new multi-family

• New non-residential

• Vertically-integrated mixed-use (non-residential and residential uses in a single structure)

Austin City Council dedicates 40% of City property tax revenues from developments that have been built on previously City-owned land toward affordable housing. The Trust Fund was established in 1999, and the City Council seeded the fund with $1 million annually for three years.

Since its inception, the HTF has funded nearly $12.2 million in rental housing and $2.4 million in ownership housing development. Housing Trust Fund dollars have historically been used as part of a multi-layered funding strategy to fund affordable units, so they leverage local, federal, and private sources to create units.

The purpose of the City's Downtown Living Initiative is to promote economic development and stimulate business and commercial activity in the combined target area by providing economic and other development incentives for certain new multifamily residential mixed-use developments. Under Houston's Downtown Living Initiative the City's provided subsidies to developers to stimulate residential development in downtown. This provides a direct incentive for developers to create units downtown to make the Central Business District a more ‘24 hour’ place.

The Four Corners Shopping Center represents a gateway to the budding community, and in 2011, was only 32% occupied and in steep decline. The developer and the City of Tomball worked to negotiate a Chapter 380 Agreement to allow for reimbursement of improvements to the Center to include a new facade, improved signage, and landscape beautification. By 2015, the Center was 95% occupied. The Chapter 380 Agreement included a 3-year “transition” period while current tenants’ lease terms are fulfilled and a 10-year effective term of agreement to garner 75% of new sales tax revenues generated in the Center and 100% of increased property tax revenues with a cap of $2.1 million to the developer over the 13-year term.

Harris County Community Service Department assisted in the development of a 381 agreement in Harris County to accommodate an anticipated 10,000 new workers as a result of Exxon's new North American Headquarters. Harris County provide $82 million reimbursement to accommodate roads, parks and other infrastructure associated with Spring Wood Village master-planned community

Defined in Chapter 44, Active IV of City's Code of Ordinance. Cullen South Houston Apartments were approved by City Council for tax abatement in 2015. The project qualified for 90% abatement and is located in a Texas Enterprise Zone. Located just 1/4 mile from the University of Housing and Texas Southern University and 1/2 mile from METRO's Light Rail, the property offers student housing opportunities and a diversified housing type in an otherwise single-family, residential neighborhood.

Highlighting the history of the Strand-Mechanic Historic District, a National Historic Landmark, the Galveston Historic Foundation reserved funds toward the development of a downtown urban green space that accommodates outdoor activities for approximately 500 permanent residents living in the historic district. Approximately 1,700 individuals are employed in the historic district, 25,000 residents are within a walkable distance, and the district is now accessible to a growing body of tourists to Galveston.

Northline Apartment Homes by Stone Arch Development, through a partnership with Capital One Community Finance and Raymond James Tax Credit Funds, used $13.8 million of LIHTC equity to construct a 172-unit garden style apartment complex.

This is an affordable housing project constructed in the Independence Heights study area. The property offers the tenants a community room, computer lab, garages, picnic area, fitness center, two playgrounds and a swimming pool. In addition, Social Services Management Consultants Incorporated provides basic education, financial planning, health and nutrition classes, scholastic tutoring, computer training, counseling and notary services.

In 2017, developer Still Properties LLC used $4.2 million in bonds to acquire and rehabilitate the Brooks Manor Apartments in West Columbia. The developer also used tax credit equity and other equity to finance the approximately $6.4 million acquisition and redevelopment costs. Steele Properties’ renovation of Brooks Manor includes siding replacement, interior renovations, new roofs, energy efficient windows and Energy Start certified HVAC systems to ensure the property continues to provide safe, decent, and affordable housing.

Houston Housing Finance Corporation provides local bond financing of single family and multifamily developments is available to partners in the private sector. The primary purpose of these programs is to encourage the development of affordable housing using below-market financing and tax exempt incentives.

To help with funding of Downtown improvement, League City applied for CDBG funds anticipated to cover $700,000 to $2.2 million of project cost. Gap funding for remaining project elements include bonds and hotel-and-motel tax revenue (Houston Chronicle, February 11, 2019)

Concept is part of Livable Centers larger concept plan which League City is also funding. In 2017 a $2.66 million bond was approved for associated Downtown Revitalization.

Fremont Plaza represents a new and aggressive strategy in economic development for the City of Alhambra. The project is centered around a renovated former Sears retail building, a once abandoned retail development.

The closing of the Sears store created an immediate loss of over 200 jobs and $180,000 in sales tax revenue from the City general fund. Initially the Alhambra Redevelopment Agency approached commercial developers, offering traditional subsidy, to redevelop the site. These developers declined to participate, and the Agency made a decision to develop the site itself using Section 108 financing.

Rebuilding Northside Together program in the Northside neighborhood is an example of a HOME Investment Partnership Program. A local non-profit, Avenue CDC, partnered with non-profit home repair provider Rebuilding Together Houston to establish a volunteer-based program. Avenue CDC secured funding of approximately $50,000 per year, identified homes in need of repair in the neighborhood, and found local volunteers from churches and other community-based organizations. (Kashmere P. 83)

• 10 Homes completed a year

• About $5,000 per home

In 2018, $6 million was awarded to Rebuilding Together Houston to repair 300 homes in Houston's Independence Heights neighborhood, with the goal of repairing 100 homes per year (Rebuild Houston Together Website)