For background, please read What's a TIRZ & Why Should I Care?
McKinney Economic Development Corporation (MEDC) Everyone pays extra 1/2 cent sales tax.
McKinney Community Development Corporation (MCDC) Everyone pays extra 1/2 cent sales tax.
Airport Tax Reinvestment Zone (TIRZ#2) Any sales and property taxes raised over a certain amount in the airport area go back into the TIRZ#2 to be spent on airport related projects.
Read Demystifying McKinney's Airport
Downtown Tax Reinvestment Zone (TIRZ#1) Any sales and property taxes raised over a certain amount in the downtown area go back into the TIRZ#1 to be spent downtown only.
Read Downtown Parking Garage Funding
Downtown Historic Neighborhood Improvement Zone (HNIZ) Property taxes are abated for a period of up to 15 years for residential property owners if certain improvements are made.
Downtown Neighborhood Improvement Zone (NIZ) Property taxes are abated for certain new developments if certain conditions are made.Through these programs, property and/or sales tax revenues are given away or redirected to specific people, corporations, or areas. Any sales or property tax revenues lost (through abatements or not being put into the general fund) are made up for by citizens continuing to pay higher tax rates than they would have paid had these diversion or subsidized programs not existed.
There are several specific things citizens need to watch to make sure these programs are being properly used:
1) Proper Use of Funds - each program has a specific purpose that must be followed. Citizens must make sure the money is being used properly.
The problem with the downtown TIRZ#1 is that even though it has over $7M in it for a huge list of possible "catalyst" projects, like a parking facility, the majority of the funding for the proposed downtown parking garage will be funded through the General Fund. Not only are large amounts of the sales and property tax that are being made downtown being diverted to the TIRZ#1, the majority of the rest of McKinney is still having to shoulder the costs associated with benefiting an area that they will not see any additional money from until after at least 2040.
The 9-Acre site is similar. No TIRZ#1 monies went to pay for any of the incentives. The General Fund paid for that as well.
For the TIRZ#1, not only are sales and property taxes being divertered away from the General Fund, we're not even ensuring that the TIRZ#1 funds are being used on actual downtown projects.
2.) Cronyism - when it looks like government, through the operation of these these programs, is picking the winners and losers, citizens will rightly become suspicious. Is there a process involved in distributing funds? Are certain areas selected over others with little or no real explanation? Was a business selected through a competitive bidding process that ensured the lowest costs paid?
3.) Overlap - Are multiple programs paying for the same things? Are we being as efficient as possible with each of the programs? Downtown has THREE different programs that can directly benefit it. Are there even more funding sources that are benefiting it and should there be? Have we all--in the entire city of McKinney--decided that we want to focus on certain areas of the city over others?
4.) Oversight - The problem with many of the mentioned programs is that they are further outside of the general city government structure. Their funding structures and processes are less understood by citizens and, therefore, harder to influence. TIRZ#1 and TIRZ#2, for example, do not have any non-official board members.
MEDC and MCDC are the most popular and prestigious citizen boards to be on. This may cause those boards to be more politically charged than others.