Developers get taxing authority

Hopefully, someone can explain to me why this makes sense. And I’m not trying to be flip or negative. I honestly don’t see why our elected officials would abdicate the power to tax to unelected real estate developers.

On Wednesday, the council voted to allow developers to create quasi-governmental districts – something called municipal management districts — that can issue public debt and levy taxes within specific areas. The goal, apparently, is give developers incentives to build infrastructure that the city can’t or won’t build. Well, that’s quite an incentive – letting the taxpayer foot the bill for something that could make the developer a ton of money.

After the jump, trying to puzzle this out:
Dallas already has two similar tax arrangements: tax increment financing and public improvement districts. Both are complicated, but the gist of each is that they give tax money to developers in specific areas for improvements in those areas. But both also leave the authority to tax in the hands of our elected officials.

So why do we need these municipal management districts and why do we need them now? This item appeared on the council docket rather unexpectedly, and without the advance notice that complicated tax issues usually get. That’s a reason for pause. Second, where did this idea originate? Who on the city staff developed it, and what was the impetus? Third, what will it cost us? If a developer floats a bond to build new roads, who pays the bond? Does it come out of the city budget or are only taxpayers in the management district responsible?

This may be a terrific idea. But right now, who knows enough to know whether that’s true or not?


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