Tax district plans move forward; Money collected will help defer cost of mall demolition

Published 10:36 am Tuesday, December 2, 2014

The city of Austin is moving forward with plans to create a tax increment financing (TIF) district for the Oak Park Mall site.

The Austin City Council voted 6-0 Monday to created a TIF district plan for the site, which would allow the city to collect money in the future to help pay off costs for a $3 million demolition of much of Oak Park Mall to make way for a 60,000- to 90,000-square-foot Hy-Vee grocery store.

The tax increment financing district would help the city recuperate funds by capturing a larger percentage than normal of increased future property taxes that would come from the project. Though the city, county and school district share portions of a business’ annual property taxes, a special tax district would increase the city’s share on the property, which would likely increase in value once the project is finished.

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The TIF district would allow the city to capture up to $4.4 million in tax revenue over the next 25 years, but Finance Director Tom Dankert said the city would have to decertify the district once it has collected enough money to pay off the project — meaning the city of Austin likely won’t get all $4.4 million.