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Council tables creation of PFC - Odessa American: Local News

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Council tables creation of PFC

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Posted: Wednesday, September 23, 2020 2:21 pm

Some Odessans addressed concerns regarding the creation of an Odessa Public Facility Corporation after council members tabled the decision during a Tuesday city council meeting.

City Manager Michael Marrero previously detailed that the creation of the PFC allows the city to partner with a developer to be able to construct workforce housing that is available to those who can pay market rates, but also those who earn less than 50 percent of the median income.

The PFC would be a corporation made up of city council, which would give council members the ability to work with developers, “to not only identify locations that would be ideal for the construction of homes, but to be involved in every aspect of that development,” Marrero said.

Marrero said that the developer, “gets to obtain a tax exemption from the city of Odessa and that is a property tax exemption for 99 years,” he said further explaining that the benefit to the city would be more housing and the city gets to share revenue generated from the apartment complex, which he said in some cases is more money than property taxes

He also said that at least 50 percent of the units have to be available to low income residents.

Following council’s decision to table the item, some citizens had words regarding Public Facility Corporations around Texas.

Odessan Larry Robinson showed up to the meeting to ask council to table the item. He spoke about PFC loopholes for developers to benefit from the programs in other cities.

“Houston’s complaining, they call em’ stack n pack little boxes and they write it all off and they don’t pay city taxes and they don’t pay sales tax and development, then it robs the true developers,” he said in an interview adding that research shows that there is little or no benefit to those needing affordable housing.

Robinson said Mayor David Turner approached him prior to the meeting and said that the PFC decision might be tabled adding that maybe Robinson wouldn’t speak.

“I declined the offer and said I would only be comfortable after a vote to cancel was affirmed,” Robinson detailed in an email.

Mayoral candidate Javier Joven also showed up to the meeting to ask council members to think it over.

District 4 Councilman Tom Sprawls said in a phone interview that he did not feel comfortable yet with the PFC and would need to do more research.

Texas Low Income Housing Information Service Advocacy Co-Director Adam Pirtle said in a phone interview that there are concerns with PFC partnerships with developers because of a lack of restrictions regarding low income availability.

“The only real restriction is that 50 percent of the units have to be available at 80 percent of the area median income and that’s it. There’s nothing in there about bedroom sizes for families. These properties don’t need to accept housing choice vouchers. There isn’t an affordability period. It really just ends up being a boon for developers,” he said.

A University of Texas research report detailed the adopted property tax exemption for private apartment developers under Section 303.042(f) of the Texas Local Government Code detailing that, “the exemptions marginal financial returns to PFCs are outstripped by the property tax losses,” and also that the exemption fails to serve the state’s affordable housing needs because the, “income restrictions do not require adjustments in household size, the income restrictions utilized at the exempt properties end up largely targeting middle-income renters making 100 percent to 115 percent of the area median income.”

The study detailed that state law should require local governments to submit annual reports to the Texas Comptroller and local taxing entities regarding apartment complexes under the exemptions, require compliance reviews including an annual audit and stated that developers partnering with local governments on PFC projects in this agreement should have to go through a competitive request for a proposal process.

Marrero said that the city would bring in a consultant to speak further on the creation of the PFC to address some of the concerns residents may have.

The University of Texas study can be located online at https://tinyurl.com/y4wm8lxh.

Council also approved an economic development agreement for a $125,000 grant between the Odessa Development Corporation and Gasket and Packings Inc., as well as approving the purchase of a command trailer for the Odessa Police Department for $289,036.77.

Council also reappointed Richard Gillham, Chris Stanley and Yervand Hmayakyan to the Public Art Committee.

Odessa, TX

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