Zoned Out

An A.G.'s opinion only adds to the questions over Houston's special tax districts

In November 1981 a constitutional amendment was approved authorizing TIRZs, but the law was again challenged on constitutional grounds in 1987 in a case that made it to the Texas Supreme Court. While the court upheld the law, it also underscored the legislative restrictions on its application: "Tax increment financing," stated the court's ruling, "is designed to aid cities and towns in financing public improvements in blighted or undeveloped areas."

Until a few years ago the city seemed content to adhere to the spirit of that interpretation, restricting TIRZs to areas that had suffered significant declines in their property tax bases. But beginning late in the administration of Bob Lanier and continuing through Mayor Lee P. Brown's first term, the city has increasingly used tax-increment reinvestment in ways that appear to undercut the intent of the state law.

For example, Council approved a TIRZ for the Upper Kirby District in July, ostensibly as an incentive to entice developers to the area. However, developers were already busy there: Projects valued at more than $100 million were under way by the time the TIRZ was created.

E-mail Brian Wallstin at

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