By BECKY KISER
Hays Post
The Hays school district, as well as Ellis County, have veto power over the city of Hays’ desire to establish a TIF (Tax Increment Financing) district to benefit the new Hilton Garden Inn and convention center project at Vine and 43rd streets.
Both the county and school district receive property tax money from the land in question.
Asst. City Manager Jacob Wood talked to school board members Monday during their meeting.
“They don’t anticipate they’re going to take any action so it shouldn’t come up again,” he told the Hays city commission Thursday. Wood will discuss the TIF with Ellis County commissioners during their Feb. 5 meeting.
City Finance Director Kim Rupp reviewed the TIF request from Hays Hotel LLC. “The TIF would be for a 20-year term on a pay-as-you-go basis. The developer is not asking the city to issue bonds for the project. “They’re pursuing their own financing,” Rupp said.
The developer estimates the TIF would generate about $3.7 million in incremental property tax revenues over the 20 years.
Rupp also noted the TIF would not include the capture of sales taxes generated at the site, which is usually done. “The retailers sales taxes collected would go to the intended taxing authorities as any other normal sales tax would,” he explained.
After development is completed, a new assessment on the property would be done by the county, establishing a new tax revenue.
“The state will keep its 1.5 mills, Hays USD 489 keeps its 8 mills for school capital outlay and its 20 mills for school finance,” Rupp explained. The school district would not receive an increase in property tax for its supplemental levy of 14.92 mills or its .646 mill declining enrollment levy, which is only good for one more year—the 2018-19 school year.
The remainder of the tax increment would be reimbursed to the developer for TIF eligible costs, which include financing and infrastructure improvements, such as water, sewer, roads and parking.
The public hearing will trigger a 30 day period in which USD 489 and Ellis County may veto creation of the TIF District.
“The school district or county could adopt a resolution saying the TIF will have an adverse effect the respective entity. If such a resolution is adopted and delivered to the city, by state law the city commission must terminate the TIF District,” Rupp told commissioners.
If the commission passes the ordinance and neither the county nor the school district exercise a veto, the next steps would include a negotiation of a TIF project plan and development agreement between city staff and the developer. The commission would review those documents for approval at a later meeting.
The city commission will conduct a public hearing at its Feb. 8 meeting and then consider approving the ordinance establishing a TIF district, which is also called a redevelopment district.