HOUSTON, Texas (KTRK) — The author of a new study on Houston’s Tax Increment Re-investment Zones (TIRZ) hopes his research spurs reform.

John Diamond, director of the Center for Public Finance for the Baker Institute at Rice University, examined 28 TIRZs over the summer.

There are 28 TIRZs in the City of Houston. They are designated areas, many of which were created in the 90s. At the time of their creation, the amount of property tax dollars given to the city was frozen. Taxes may increase, but any additional funds raised above the set amount are returned to the area to be reinvested.

Board members are appointed by the mayor and oversee and allocate funding without a public vote.

“It’s not very transparent, and that’s not how city government is supposed to work,” Diamond said.

After analyzing documents and figures for months, he said the zones are “absolutely not” working properly.

“It would be very hard to say,” Diamond said. “So if these are supposed to go to places that are underdeveloped or struggling or need some kind of help to start the development process, well, why are we doing it in Uptown? Why Memorial Park?”

The purpose of the TIRZ is to take a stagnant area of ​​the city and hopefully spark economic growth.

Projects often include building sidewalks, parks, road repairs or beautification.

Areas where property taxes have gone up collect more money and have more money to pour into the area.

Diamond found in his research that the highest spending TIRZs are areas where the median income is well above the rest of the city.

Memorial Park is one example Diamond gave. The Uptown TIRZ was part of the latest project that included building a land bridge.

“You built this great park, and now everybody wants to live in that area,” Diamond said. “It pushes property values ​​up in that area.”

Increased property values ​​mean higher property taxes and more money put back into TIRZ.

Diamond said measuring the benefit of projects completed by TIRZ was one of the most challenging parts of the study. He said the use of the projects is not the only benefit. They often increase property values ​​as well, as in the case of Memorial Park.

Diamond pointed out that the city’s lack of tax dollars has to be made up somewhere, so the tax burden could fall on areas outside the TIRZ.

“The city’s tax base is being cannibalized,” Diamond said.

Michael Moore, president of the Uptown TIRZ, told ABC13 the study only provides a single data point and doesn’t paint a full picture of its benefits to the city.

“Uptown TIRZ has provided over $264 million to citywide affordable housing projects, contributing immensely to housing needs,” Moore said in a statement. “In addition, it generates significant sales and hotel taxes, which support city revenues and other entities such as the county, METRO and the state of Texas.”

Moore also said investments made in infrastructure have spurred billions of dollars of growth near Uptown.

TIRZ has been on Mayor John Whitmire’s radar since taking office. His office has begun a review of the zones after three people associated with the Midtown TIRZ were accused of stealing or misappropriating millions of dollars and arrested over the summer.

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