Title
Consider a memorandum/resolution for the adoption of guidelines and criteria for tax abatement.
Summary
DATE: October 18, 2022
TO: Kent Cagle, City Manager
FROM: Edwin Revell, Executive Director of Development Services
SUBJECT: Adoption of guidelines and criteria for tax abatement
BACKGROUND AND FINDINGS:
Enterprise and reinvestment zones are economic development tools which seek to encourage job creation and capital investment. The City of Killeen currently includes areas within enterprise zones according to the Economic Development and Tourism Division of the Governor's Office. The enterprise zone program allows a community to partner with the state to offer local and state tax and regulatory benefits to a new or an expanding business in the designated distressed areas. The governing body of a municipality by ordinance may designate an area as a reinvestment zone when such designation is likely to attract major investment in the zone. Tax abatement is one of the tax incentives available in an enterprise or reinvestment zone.
In order to offer tax abatement, the City is required to establish guidelines and criteria governing tax abatement (Tax Code ?312.002). The Tax Code provides that the guidelines and criteria adopted are effective for two years from the date adopted. Guidelines and Criteria for Granting Tax Abatement in Reinvestment and Enterprise Zones were originally adopted by the City of Killeen in 1996. They were adopted every two years since then, but they have been modified to stay current with state law. There is a minor change to the Guidelines and Criteria for this adoption, including updating the definition of Abatement to include real property or tangible personal property located on the real property, or both. This language more closely mirrors the state tax code.
THE ALTERNATIVES CONSIDERED:
The City Council has two (2) alternatives. The Council may:
* Disapprove continuing the City's eligibility under state law to partic...
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