County could set up a tax financing district to pay for Austin F1 roadway
Under the proposed plan, the county would dedicate gains in property tax revenue from the project to pay off financing for public improvements surrounding the track. Because the 3.4-mile Grand Prix circuit lies outside of Austin, it would be up to Travis County to create the zone.
Tax increment financing "enables you to raise a fairly large amount of cash immediately," County Judge Sam Biscoe said this week. "You issue debt, and you use the (increased) revenue to pay off that debt."
"I think it's a great idea," said Richard Suttle, an attorney who works with the track's developers. "I think it's getting some traction."
One advantage from F1's standpoint is that such a mechanism, called a Tax Increment Reinvestment Zone, would not require voter approval, as do other financing options for infrastructure related to the racetrack. Suttle said it could be an alternative — or an add-on — to a countywide hotel tax that has also been proposed to pay for road and drainage improvements.
According to the 2010 tax increment financing zone registry compiled by the state comptroller's office, there are nearly 200 such zones in Texas. In Austin, they include the former Mueller airport, and along Waller Creek and the former Seaholm Power Plant downtown. Typically used to spur development in areas where the tax base is relatively low, the districts capitalize on the resulting increase in property values to finance roads, utilities and other public works.
Although construction is plowing ahead on the $250 million project, a potential sticking point has been the narrow roads bordering the site. County planners recommend widening Elroy Road, which borders the track on the north, and improving a low-lying bridge — and they have said F1 promoters should pay the estimated $6 million cost.
"We're not convinced we have to have that for the first race," Suttle told more than 50 Elroy residents at a public meeting last week. "We think we can manage around it."
Not everyone agrees.
Last fall, county officials estimated a Grand Prix race, which might draw a crowd approaching 120,000 fans, could create traffic delays of up to 12 hours. Race promoters have since produced a study forecasting delays in the three-hour range, but no one has claimed the current roads suffice as a long-term traffic solution.
"The increased traffic will make their lives miserable," Biscoe said of county residents who live near the track. The Statesman