What The TIRZ?

By: Kyle Macy, P.E.
Project Manager – Public Works

Anyone who has had a casual flip through a Texas business publication has seen the word TIRZ thrown around haphazardly. What you may not know is what a TIRZ actually is, how it supports our region and how that tax revenue is put to work for Texans. Fear not; I offer my services as a TIRZ expert to decipher the alphabet soup so you can impress your coworkers.

Tax Increment Reinvestment Zones (TIRZ) only exist in Texas. They are ‘special’ zones created by City Council of a municipality to attract new investment in the area. Within these zones, a portion of the tax attributable to the new improvements is set aside in a fund to finance public improvements with the TIRZ boundary. A massive benefit then is that a portion of the taxpayers dollars located within the TIRZ boundary stay within the TIRZ for potential improvement projects.

Each year, the taxing entity (E.g. City of Houston) receives the baseline property value of the property taxes throughout the life of the TIRZ. The predetermined amount above that baseline value is the portion allocated to the TIRZ. Additionally, each year, the TIRZ revisits the TIRZ project plan which prioritizes potential projects within the designated TIRZ area. The average TIRZ is approximately 1500 acres or about 900 city blocks. The TIRZ Board Members (who are appointed by City Council) recommend and prepare the Capital Improvement Plan (CIP). This process is done transparently and with coordination of the municipality. That teamwork is critical as this plan is then approved by City Council and any changes must again be approved by City Council. 

The projects selected to design and construct from the project plan are goal oriented to provide infrastructure improvements, pedestrian friendly environments, and amenities such as parks and greenspaces. These types of improvements attract area reinvestment and put the property tax dollars of the current residents directly to work in their communities. 

EHRA is currently involved in some very exciting projects within TIRZs in Houston including:

  • Reconstruction of Hemphill Street, from Lubbock Street to Washington Avenue.
  • Reconstruction of nine blocks of streets in East Downtown, including a Bike Lane on Polk Street.
  • Rehabilitation and Bike Lane addition on Walker Street from St. Emanual Street to Emancipation Avenue.
  • Design and Construction of a Children’s Playground and Greenspace on the Bastrop ROW between Polk Street and Bell Street.
  • Park Improvements along the Columbia Tap Trail.

The EHRA Public Works team currently works in multiple TIRZs in the Greater Houston region. Anyone who is interested in learning more about the TIRZ program in Houston and how it directly impacts and revitalizes communities should not hesitate to contact me for further clarity. EHRA supports a culture of active learning and knowledge sharing.

For additional information on TIRZs within the City of Houston, please click here.