DEPARTMENT: Department of Planning and Community Development
DEPARTMENT HEAD: John Dugan
COUNCIL DISTRICTS IMPACTED: 3, 4, and 5
SUBJECT:
Assignments of Development Agreements for specific Developer Initiated Tax Increment Reinvestment Zones.
SUMMARY:
This is an Ordinance by City Council authorizing the City Manager or designee to execute Assignments which would assign all benefits, rights and obligations arising from the Development Agreement from HLH Developments, L.P. to their parent company Hausman Holdings, Ltd for the following Tax Increment Reinvestment Zones (TIRZ): Plaza Fortuna TIRZ # 12 located in City Council District 5, Mission Creek TIRZ # 17 located in City Council District 3, Hallie Heights TIRZ # 19 located in City Council District 4, and Heathers Cove TIRZ # 21 located in City Council District 4. These are all Developer-Initiated TIRZ.
Approval of this Ordinance and execution of the four TIRZ Assignments will assign all benefits from HLH Developments L.P. to Hausman Holdings, Ltd.
BACKGROUND INFORMATION:
Per the developer's request HLH Developments, L.P. requested to assign all of its benefits, rights and obligations arising from the Development Agreement to their parent company Hausman Holdings, Ltd. All TIRZ assignments require formal approval from their respective TIRZ Board, Bexar County Commissioners Court and City Council. The above mentioned TIRZ held Board meetings on March 19, 2014 and approved the request to assign benefits, rights and obligations to Hausman Holdings, Ltd. Subsequently, Bexar County Commissioners Court met and approved the request on June 3, 2014. The TIRZ Boards and the Bexar County Commissioners Court have executed the Assignments.
Hausman Holdings, Ltd. will be bound by all terms, provisions and representations of the City Council approved Development Agreements as a condition of assignment and agree to assume all obligations and liabilities of HLH Developments, L.P. under the TIRZ documents. There are no other amendments or changes to the developer's obligations.
Plaza Fortuna TIRZ #12 was designated December 13, 2001 and will terminate September 20, 2025. It is located at Hortencia and Fortuna St. off of West Commerce St. The development included the infrastructure and 76 single-family units. The Developer has completed the project.
Mission Creek TIRZ #17 was designated December 9, 2004 and will terminate September 30, 2029. It is located south of Brooks-City Base and west of Mission Academy. The development included the infrastructure, 19.48 acres dedicated to SAISD for a school, 448 single-family homes on 66.93 acres, land dedicated to the City is 1.88 acres and a recreational park on 12.18 acres. The Developer has completed the project.
Hallie Heights TIRZ #19 was designated December 9, 2004 and will terminate September 30, 2024. The location is bordered by Sun Valley Elementary School to the north, S.W. Loop 410 to the east, Lackland Subdivision Unit 40 to the west, and Ray Ellison Boulevard to the south. The development included the infrastructure and 200 homes. The Developer completed 187 homes and has sold the remaining 13 lots to a home builder. The Developer has completed the infrastructure and 94% of the development has been completed.
Heathers Cove TIRZ # 21 was designated December 16, 2004 and will terminate September 30, 2024. It is located at Medina Base Road and Southwest Loop 410. The Developer completed the infrastructure and 98 percent of the proposed 174 homes. Two lots remain to be developed. The proposed 255,219 square feet of commercial improvements have not been built.
ISSUE:
Per the developer's request, HLH Developments, L.P. requested the transfer of the Assignments which would assign all benefits, rights and obligations arising from the Development Agreement from HLH Developments, L.P. to their parent company Hausman Holdings, Ltd. for Plaza Fortuna #12, Mission Creek #17, Hallie Heights #19 and Heather's Cove #21 and their respective TIRZ Boards approved the Assignments March 19, 2014. The Bexar County Commissioners Court approved the Assignments June 3, 2014.
Hausman Holdings, Ltd. will be bound by all terms, provisions and representations of the City Council approved Development Agreements as a condition of assignment and agree to assume all obligations and liabilities of HLH Developments, L.P. under the TIRZ documents. There are no other amendments or changes to the developer's obligations.
City Council is being asked to consider an Ordinance that will allow staff to complete the transfer of the Assignments for all four TIRZ listed above. Once the documents are fully executed, the Developer will assume all obligations of the TIRZ Development Agreements.
ALTERNATIVES:
The alternative is to not execute the Assignments of all benefits, rights and obligations from HLH Developments, L.P. to their parent company Hausman Holdings, Ltd. for the following TIRZ: Plaza Fortuna #12, Mission Creek #17, Hallie Heights #19 and Heather's Cove #21. HLH Developments, L.P. would retain the Assignment for these TIRZ.
FISCAL IMPACT:
The approval of the Assignments from the developer HLH Developments, L.P. to their parent company Hausman Holdings, Ltd has no direct financial impact to the General Fund. The TIRZ for Plaza Fortuna #12, Mission Creek #17, Hallie Heights #19 and Heather's Cove #21 will continue to capture property tax value on improvements within the respective TIRZ at the current participation rate for the duration of each TIRZ term.
RECOMMENDATION:
Staff recommends approval of this Ordinance by City Council authorizing the City Manager or designee to execute the Assignments for the transfer of all benefits, rights and obligations from the developer HLH Developments, L.P to parent company Hausman Holdings, Ltd.