Harlingen EDC proposing $9 million bond issue in $97 million development

Orlando Campos

In one of the Harlingen Economic Development Corporation's biggest projects in years, the agency's planning to sell $9 million in bonds as part of a proposed $97 million project aimed at developing a 51-acre site to build homes, office suites, retail shops, restaurants and hotels.

After years of planning, the EDC is proposing borrowing the money to fund street, utility and drainage construction in the area along Hale Avenue and Ed Carey Drive, part of a city tax increment reinvestment zone which would reimburse the money.

"We are very excited," Orlando Campos, the EDC's chief executive officer, said in an interview. "This project has been several years in the making. This is an opportunity to attract more restaurants and retail to the area to make it a live-work-play project for the community. From an economic development standpoint, it would obviously generate more tax revenue."

The proposed project site lies within a city tax increment reinvestment zone carrying a current balance of $4 million worth of revenue, Campos said.

As part of the zone created in 2006, the city contributes 80% of the area's property tax-generated revenue, while Cameron County contributes 100% of its revenue.

While the city's participation in the tax zone is set to expire in 2035, the county's participation expires in 2027.

Now, the EDC is requesting Cameron County commissioners extend the county's participation to 2035 to help the zone's revenue reimburse the $9 million the agency's planning to borrow.

Tax increment reinvestment zones are areas which cities and counties designate to finance economic development projects by accessing property tax revenue generated within the zones after their baseline taxable value is frozen, allowing their growth in assessed property value to become available for use.

For years, city leaders have been planning the project that's developed into a public-private partnership, Campos said.

On the 51-acre project site, the EDC owns 19.8 acres while three private property owners own the remainder of the land, he said.

"Since we own property there, we approached other property owners to see if they would like to participate," Campos said.

Now, Garver Engineering is building a $5 million, 25,000-square-foot office building on the EDC's land while a prospective business is proposing to build its own 25,000-square-foot office building on the site, he said.

"The project will be phased in over the next few years pending public infrastructure financing," Campos said. "Owners of the private properties are actively marketing their sites and already have interest from retailers and restaurants. Firm commitments will be made once infrastructure construction begins."

The project would become the city's first multi-use development, or "live-work-play" project, featuring multi-family homes, office suites, retail shops, restaurants and hotels.

"This type of development in pretty common in larger cities such as Dallas, Houston and San Antonio," Campos said. "A lot of retail and restaurants would be within walking distance to help enhance the medical district. It provides more options for employees and visitors."

Officials project the development would be completed by 2035, he said.

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