The Dallas City Council has approved a housing development project worth almost $200 million and agreed to waive 75 years of tax payments on the property.
During a Wednesday meeting, the council authorized the Dallas Public Facility Corporation (DPFC) to purchase a 15-acre property at 9999 West Technology Boulevard.
The DPFC is a nonprofit that develops and manages land. Properties acquired by the DPFC are tax-exempt.
The DPFC will lease the land to the private developer LDG Development, who will then develop a housing complex on the property known as The Park at Northpoint for an estimated $177 million.
The 75-year tax-exempt lease will be offered to LDG Development in exchange for half of the complex’s 615 units being designated as “affordable housing.”
Council Member Cara Mendelsohn noted on Twitter that the lease payments from the private developer do not go to the City of Dallas but rather to the DPFC, meaning that “the city coffers” will miss out on $4 million per year from this agreement.
Mendelsohn and Council Member Adam McGough were the officials to vote against the agreement on Wednesday that authorized the DPFC to use $10 million of Community Development Block Grant Funds to acquire the property.
“I think it’s pretty outrageous to vote on something when you don’t even know how much money you’re giving up,” Mendelsohn said.
Council Member Omar Narvaez, who represents the district in which the complex will be developed, emphatically supported the deal. He said it is important to bring residential buildings to the area.
He described the location as the “perfect place” to develop housing due to its close proximity to restaurants, a school, parks, a trail system, and a lake.
“Everything you need is there, except it was originally developed to be a commercial area,” he said. “Mixing in residential is going to be the key factor for us to start to redevelop this area.”
Narvaez said the City “desperately needs” to continue developing mixed-income residential housing.
“You don’t have a lot of places where you have all of these amenities ready to go [where] you can bring housing in. That’s why it’s working in Northwest Dallas,” he continued.
However, Council Member Mendelsohn noted the lack of financial transparency in the documentation of this deal. Most deals that offer tax exemptions provide an “estimated revenue foregone” figure that shows the amount of tax money the City will go without.
This deal offers a 75-year tax exemption, but no such figure was provided.
Mendelsohn insisted that it is “inappropriate for us to be approving an item when we don’t even know what our revenue foregone would be.”
Mendelsohn also voted against two other housing development agreements during Wednesday’s meeting.
“I just don’t see the public benefit when it’s so many dollars that we will be missing from our general revenue,” Mendelsohn explained.
Despite Mendelsohn’s objections, the City Council also authorized deals for two additional housing developments costing a total of $12,123,705 in estimated tax revenue foregone over the next 15 years.
The two properties are Fitzhugh Urban Flats at 2707 North Fitzhugh Avenue and Larkspur Fair Park at 3525 Ash Lane.