Frequently Asked Questions

Tax Increment Reinvestment Zones (TIRZs) are special areas of the city created pursuant to Chapter 311 of the Texas Tax Code by an act of City Council. A TIRZ creates and extends projects which, in turn, attracts development to these areas. The policy of the administration is to focus these projects on developing and building infrastructure to catalyze future economic development. The City of Houston currently has 24 active TIRZs. City Council approves all budgets and project plans of every TIRZ in the City of Houston.

No. Revenue generated within a TIRZ comes from existing tax revenue. The City sets the property tax base year at the same time the TIRZ is created. Tax revenue increases above this base year within the TIRZ is called “increment”. The increment is then reinvested into the area via approved projects in accordance within a project plan developed by the board of directors and approved by city council. No new taxes are created and increment generated within a community is reinvested within the TIRZ boundary through a community driven process.

At a TIRZ creation, City Council directs the TIRZ boards to use the increment generated to fulfill project plans that are approved by City Council. These project plans improve the geographic area designated in the TIRZ. The TIRZ submits an annual budget for implementation of its project plan. All TIRZ budgets, future capital projects and amendments to the project plan are approved by City Council.

No. The Montrose TIRZ has a life of 30 years pursuant to it’s enabling ordinance and is currently set to dissolve in 2045. City Council may vote to extend the life of a TIRZ beyond the life originally created.

TIRZ revenue comes from property tax already paid with no new taxes or fees. Management District funding comes from assessments imposed by the Management District primarily on commercial property. The use of TIRZ incremental revenue is limited to projects defined by Chapter 311 of the Texas Tax Code. City Council approves the TIRZ project plan. Management District Boards are originally appointed by the Legislature. TIRZ boards are appointed and approved by city council.

Residents/neighborhoods/civic clubs will have a new source of funding, limited to their neighborhood, controlled by their neighbors to build infrastructure projects within the boundaries of the TIRZ. Those projects may be water and sewer infrastructure repair, street repair, park improvements, curb and sidewalk reconstruction, street lighting, traffic control, landscaping, parking structures, park and green space improvements, and more as allowable by Chapter 311 of the Tax Code.

Pursuant to it’s Project Plan and Reinvestment Zone Financing plan, TIRZ 27’s goals include facilitating the development and redevelopment of affordable housing in the TIRZ boundaries. Almost 25% of the proposed TIRZ 27 project cost relate to workforce/affordable housing.

Chapter 380 of the Local Government Code authorizes municipalities to offer incentives designed to promote economic development such as commercial and retail projects. Specifically, Chapter 380 allows municipalities to offer loans and grants of city funds or services to promote state and local economic development and to stimulate business and commercial activity.

All 380 agreements must be approved by City Council. It is the policy of the administration to use these agreements to reimburse the private sector for infrastructure investments approved by City Council. In some cases, City Council has utilized TIRZs to enter into 380 agreements.

The Montrose TIRZ boundary was drawn to encompass the major Montrose transit corridors in need of improvement, while complying with state laws, including keeping the percentage of residential property within the boundaries below statutory requirements.
Through a community driven process and stakeholder meetings, the TIRZ will focus on the high traffic Richmond, Montrose, West Alabama, and Westheimer corridors to achieve the goal of improved mobility in the area. Community feedback also showed an interest in focusing on workforce housing to alleviate pressure from rising rents in the area and preserve Montrose as a community to foster arts and culture.

It is the policy of the City of Houston that the geographic area of a TIRZ is represented by people who have an interest in the area. All board appointments must be approved by City Council.

Here is a map of the boundaries of the Montrose TIRZ.

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