* This transcript was created by voice-to-text technology. The transcript has not been edited for errors or omissions, it is for reference only and is not the official minutes of the meeting. AYE [00:00:01] CHAIRPERSON RON TAYLOR. CALL THIS MEETING [Tax Increment Financing Reinvestment Zone Nos. 2 & 3 Board of Directors on March 3, 2026.] OF THE CITY OF RICHARDSON, TAX INCREMENT FINANCING REINVESTMENT ZONE NUMBERS TWO AND THREE. BOARD TO ORDER. TODAY IS MARCH 5TH, 2026, AND THE TIME IS 6:34 PM THE NEXT ITEM ON OUR AGENDA IS TO CALL ANY VISITORS TO SPEAK TO THE BOARD. DO WE HAVE ANYONE WHO WOULD LIKE TO ADDRESS THE BOARD? NO SINGLE VISITORS WHO WOULD LIKE TO SPEAK. WE'LL MOVE ON. NEXT ITEM ON OUR AGENDA IS THE REVIEW AND APPROVAL OF THE MINUTES FROM OUR PREVIOUS MEETING ON JULY 23RD, 2025. DO I HAVE A MOTION OR AMENDMENT FOR APPROVAL OF THE MINUTES? I SO MOVE. SO MOVED BY MARY. DO I HAVE A SECOND? I SECOND. OKAY. MOTION AND SECONDED. ALL IN FAVOR, PLEASE RAISE YOUR HAND. OPPOSED? SAME SIGN NONE. MOTION PASSES BY VOTE OF 1, 2, 3, 4, 4, ZIP. THE NEXT ITEM ON OUR AGENDA IS TO REVIEW THE TAX INCREMENT FINANCING REINVESTMENT ZONE NUMBERS TWO AND THREE ANNUAL REPORTS FOR FISCAL YEAR ENDING SEPTEMBER 30TH, 2025. MR. GASTRO. THANK YOU MR. TAYLOR. THANK YOU. BOARD MEMBERS. UH, SO THIS EVENING WE'RE GONNA GO OVER, UH, THE TIFF NUMBER TWO AND THREE ANNUAL REPORTS. UH, SO EVERYBODY LISTENING IS AWARE, WE HAVE ALREADY SUBMITTED THESE TO THE STATE OF TEXAS. UM, AND THEN BY NEXT WEEK WE'LL HAVE THESE AVAILABLE ONLINE, UH, FOR THE PUBLIC TO SEE ON OUR WEBSITE. BUT TONIGHT GONNA GIVE YOU AN OVERVIEW OF SOME OF THE KEY CONTENT THAT'S WITHIN THE REPORT FOR EACH OF THE T TWO AND THREE TIF TWO. WE'VE GOT A, WE'VE GOT AN AERIAL THERE, UM, SHOWING AN OUTLINE OF TIF. NUMBER TWO, AS YOU'RE AWARE, IT WAS ESTABLISHED IN 2011. UH, IT RUNS THROUGH 2036. IT'S 212 ACRES, UH, REALLY RUNNING FROM, UH, THE DART LINE THERE. UM, YOU HAVE, UH, ON THE WEST SIDE AND YOU CAN SEE WE HAVE THE SILVER LINE COMING IN JUST ON THE WEST SIDE THERE. UH, AND THEN IT GOES OUT EAST. SO A LOT OF THE CITY LINE AREA, OBVIOUSLY A KEY COMPONENT OF TIF NUMBER TWO, HERE'S A LOOK AT THE HISTORY OF THE TAX VALUES, UH, FROM WHAT WAS PROJECTED VERSUS WHAT THE APPRAISALS HAVE COME IN AT. UM, YOU CAN SEE THE BASE YEAR VALUE WHEN THIS WAS ESSENTIALLY FARMLAND WAS $37,000 OF VALUE. AND TODAY IT'S SITTING AT, UH, 1.3 BILLION. SO CERTAINLY A LOT OF GROWTH WITH THE DEVELOPMENT. NO SURPRISE THERE. UH, FROM THAT STANDPOINT, LOOK AT THE REVENUES THAT WERE GENERATED, UH, INTO THE TIFF. AND, AND A REMINDER FOR, FOR THE TIFF ON THE CITY SIDE, UH, WE, WHEREAS TIFF ONE, A HUNDRED PERCENT OF THE INCREMENT THAT'S GENERATED GOES INTO THAT TIFF TIFF'S TWO AND THREE. THE CITY CONTRIBUTES TWO THIRDS INTO THERE. SO 66.67% IS WHAT GOES INTO THERE. THE OTHER THIRD OF THE TAX REVENUES GENERATED FROM THAT GROWTH, UM, GOES INTO THE CITY'S GENERAL FUND. UH, SO JUST A NOTE THERE. UH, BUT LOOKING AT THE REVENUES THAT WERE GENERATED, SO WE HAD 5.9 MILLION COMING IN BETWEEN THE CITY AND COUNTY, UH, UH, PARTICIPATION AS WELL AS SOME INTEREST EARNINGS. AND WE WERE BUDGETING VERY SIMILAR NUMBERS FOR, FOR THE CURRENT YEAR. THE DEVELOPER RECEIVED A OVER, UM, UH, 5.2 MILLION. UM, AND THEN LOOKING AT THE CURRENT YEAR, ESTIMATING ABOUT 5 MILLION, UH, TO THE DEVELOPER. UH, DART YOU'LL SEE HAS, UH, NO PAYMENTS TO DATE. UH, WE ARE ANTICIPATING THAT THEIR FIRST REQUEST WILL OCCUR THIS YEAR. UH, I BELIEVE WE SAID THE SAME THING LAST YEAR. UM, BUT WE ARE WAITING ON THAT REQUEST WITH ALL THE SUB, WITH ALL THE DOCUMENTATION TO SUPPORT THEIR EXPENSES THAT OCCURRED WITHIN, WITHIN THE ZONES, UH, TO, TO SUBSTANTIATE BEFORE WE PAY OUT ANY FUNDS FROM THE TIF. UM, FOR THAT, AND, AND, AND JUST TO NOTE AND TO CLARIFY, SO OF THE 66.67% THAT THE CITY IS CONTRIBUTING 55, ONCE, ONCE DART RECEIVED FINANCING FOR THAT SILVER LINE AND STARTED THAT DEVELOPMENT, THE DEVELOPER'S PORTION DROPPED TO 55% AND THEN 11.67% IS WHAT GOES TO DART. AND SO THAT'S WHY THERE'S THE DISTINCTION THERE. BUT THE LARGER AMOUNT THAT WE'RE ANTICIPATING PAYING THIS YEAR TO DART IS BECAUSE WE'VE BEEN CARRYING THAT BALANCE FOR SEVERAL YEARS. SO IT'S BEEN ACCRUING, HERE'S A LOOK AT THE FINANCIAL POSITION OF, OF TIF NUMBER TWO. UH, SO WE ENDED LAST FISCAL YEAR, UH, SEPTEMBER 30 WITH A LITTLE OVER 5.4 MILLION. UH, A LOT OF THAT IS THE, THE AMOUNT THAT WAS AVAILABLE FOR DART THAT HAS NOT YET BEEN PAID OUT. UM, YOU CAN SEE A BIG SHIFT IN THAT WE'RE ANTICIPATING SPENDING OUT THE MONEY TO BOTH THE DEVELOPER AND DART THIS YEAR, WHICH WOULD BRING, UH, THE FUND BALANCE BACK DOWN. [00:05:01] UH, THERE IS A NOTE THAT THE BUDGETED AMOUNTS THERE ARE AS OF LAST JULY WHEN WE WERE PUTTING TOGETHER THE BUDGET, UH, WE WOULD ADJUST THE AMOUNT PAID OUT TO THE DEVELOPER IN DART, UH, AS NEEDED TO ENSURE THAT WE KEEP OUR FUND BALANCE AT THE $50,000 LEVEL THAT WE HAVE AS A FUND BALANCE REQUIREMENT. SO ALTHOUGH IT SHOWS 18,759 ON THE SLIDE, THAT'S AGAIN, WE'RE SHOWING YOU WHAT THE ADOPTED, UH, BUDGET WAS AT THAT POINT IN TIME AS WE ACTUALLY FINISHED FY 25 WITH A SLIGHTLY DIFFERENT FUND BALANCE IS WHY YOU NOW SEE IT AT 18,000. BUT AGAIN, WE'LL MAINTAIN THE FUND BALANCE REQUIREMENT. TIFF NUMBER THREE. SO GOING DIRECTLY WEST FROM WHERE TIF TWO ENDED, UH, YOU SEE IT STRADDLING 75, THE DART LINE OR SILVER LINE COMING THROUGH THROUGH THE MIDDLE OF IT AS IT CONNECTS, UH, RIGHT NEAR WHERE THE RED LINE, UM, THE RED LINE IS. AND SAME SETUP, SAME TIMING AS TIF NUMBER TWO, UH, WILL RUN FOR 25 YEARS TILL 2036. HERE'S A LOOK AT THE VALUES OF WHAT WAS PROJECTED VERSUS WHAT'S BEEN APPRAISED. SO YOU'LL OBVIOUSLY SEE A DEVIATION HERE FROM WHAT IS APPRAISED VERSUS WHAT THE PROJECT PLAN BACK IN 2015 WAS ANTICIPATING WOULD BE THE CASE. UM, UH, SOMETHING TO NOTE, WHICH I KNOW THE BOARD IS WELL AWARE OF, THERE IS SOME SECTIONS OF THE LAND THAT ARE JUST INHERENTLY TOUGH TO DEVELOP THERE, BUT WHERE 75 AND GEORGE BUSH CONNECT, THERE'S SOME AREAS THAT'S GONNA BE TOUGH TO DEVELOP AS WELL. WHEN THE PROJECT FINANCING PLAN WAS PUT TOGETHER, IT WASN'T ANTICIPATED THAT A LARGE SECTION WOULD BECOME EXEMPT PROPERTY CHURCH. AND SO LIKE WITH THE CREATE CHURCH AREA, THAT'S PROPERTY THAT, UM, WAS BUILT IN AS A PART OF THE DEVELOPING WITH THE FINANCING PLAN, BUT THAT'S EXEMPT PROPERTY. SO, UH, FOR THIS PARTICULAR TIFF, I DON'T ANTICIPATE WE'LL CATCH UP TO, TO WHAT THE PROJECTIONS WERE. BUT THAT SAID, WE STARTED WITH A BASE VALUE OF 11 MILLION AND NOW IT'S SITTING AT 277 MILLION. SO STILL SIGNIFICANT GROWTH OVER, UH, OVER THE 14 YEAR PERIOD REVENUES THAT WERE, UH, WE BROUGHT IN ABOUT 1.2 MILLION LAST YEAR. AGAIN, BUDGETING ROUGHLY THE SAME, UH, FOR THE CURRENT YEAR. NO, NO MAJOR CHANGES TO NODE. I HAVE A QUESTION ON THE YES. THE APPRAISED VERSUS THE ACTION. WHEN WOULD YOU JUST BRING, WOULDN'T YOU BRING THE APPRAISED VALUE DOWN LIKE THE PROPO THE, UH, FORECASTED VALUE DOWN SO THAT IT DIDN'T SHOW SUCH A DIFFERENCE ON THE PRIOR SLIDE? SO THIS IS BASED ON THE FINANCING PLAN THAT WAS PUT IN PLACE BACK IN 2015. SO SIMILAR TO WHAT WE DID WITH TIF TWO, WE'RE TRYING TO SHOW HOW, WHEN WE WERE PROJECTING WHAT THE VALUES WOULD DO, WHAT IT ACTUALLY HAS DONE, SO, BUT TO YOUR BANK. SO TYPICALLY WE ONLY ADJUST OUR PROJECT PLANS WHEN WE'RE KIND OF REQUIRED TO. SO IF YOU THINK BACK TO TIF NUMBER ONE, UM, WE DID THAT I THINK AROUND 2015 AND 2020 BECAUSE BY STATE LAW, IF YOU ADD TO YOUR TIF, SO LIKE WHEN WE ADDED THE IQ AREA TO TIF, NUMBER ONE, WE HAD TO GO AND ADJUST OUR PROJECT PLAN. THERE'S REALLY NO REASON TO ADJUST THE PROJECT PLAN RIGHT NOW. YEAH. YOU KNOW, WE'D HAVE TO GO PAY A CONSULTANT TO COME IN AND DO SOME WORK MM-HMM . AND IT'S JUST THIS IS, THERE'S REALLY NO CHANGES FROM A DEVELOPMENT AGREEMENT STANDPOINT. SO YOU CAN'T CHANGE, YOU WOULDN'T WANNA CHANGE THE NUMBERS 'CAUSE IT'D BE ADMINISTRATIVELY BURDENSOME TO EVEN LIKE DO THAT. I DON'T, I DON DUNNO IF IT'D BE ADMINISTRATIVELY BURDENSOME, BUT I THINK WE'D BE PAYING SOMEONE TO COME IN AND, AND KIND OF UPDATING OUR PROJECT AND FINANCING PLAN FOR REALLY KIND OF NO REASON. YEAH. BECAUSE WE KNOW WHAT THE EXISTING VALUES ARE. OKAY. UM, NOW AGAIN, IF WE WERE GONNA ADD, UH, PROPERTY TO THIS TIFF OR MAKE CHANGES LIKE THAT, THEN WE WOULD HAVE TO COME IN AND ADJUST THAT PROJECT AND FINANCING PLAN. OKAY. BUT REALLY WHAT THAT SHOWS IS THAT AT THE BEGINNING OF ALL THIS, YOU DIDN'T KNOW THE CHURCH WAS GONNA END UP TAKING UP QUITE A BIT OF THE ZONE. NO, AND I THINK, LIKE TODD KIND OF ALLUDED TO, WE ALWAYS KNEW IN THIS PARTICULAR TIFF, SO EVEN IF THE CHURCH DIDN'T COME IN THAT PROPERTY THAT IT'S ON UP THERE IN THAT KIND OF CORNER, UM, THAT THAT NORTH CORNER YEAH. THAT, THAT DID NOT HAVE THE BEST ACCESS. IT'S NOT GREAT ACCESS TO THAT PROPERTY. IT WAS ALWAYS PROBABLY GONNA BE HARD TO DEVELOP THAT PARTICULAR AREA. NOW THERE ARE SOME AREAS, YOU KNOW, KIND OF RIGHT ACROSS, UH, UH, 75 THERE IN THAT, THAT CORNER AT KIND OF 75 AND, AND THE BUSH TURNPIKE THERE, THAT'S STILL VACANT AND THERE'S SOME OTHER VACANT PROPERTY AS WELL THAT THAT'S PRETTY NICE PROPERTY THERE. AND I THINK WE THINK AT SOME POINT, IN FACT BEFORE COVID WE HAD A DEAL THAT WAS IN THE WORKS AND THAT KIND OF FELL THROUGH RIGHT? RIGHT. THIS COVID HAPPENED. SO I THINK THERE'S MORE OPPORTUNITIES IN THIS TIF FOR SOME DEVELOPMENT TO HAPPEN. NOW LOOK AT THE PAYMENTS, UH, PAID OUT, UH, SIMILAR TO TIF TWO. SO PAYMENTS WENT TO THE DEVELOPER, UH, THAT WITHIN TIF THREE, UH, ABOUT A MILLION DOLLARS LAST YEAR, ANTICIPATING A SIMILAR AMOUNT THIS YEAR. UH, DART, WE'VE BEEN CARRYING THEIR BALANCE, UH, WITHIN TIF THREE, UH, WAITING FOR THAT, UH, REQUESTED PAYMENT WITH THE BACKUP TO SUBSTANTIATE [00:10:01] THEIR EXPENSES WITHIN THE TIF, UH, TIF ZONES, UH, FOR HELPING FUND, UH, THE SILVER LINE. BUT WE ARE PROJECTING WE'LL PAY THAT OUT THIS YEAR. UM, IF WE DON'T, WE WILL CONTINUE TO CARRY FORWARD AND EARN INTEREST ON IT. IN THE MEANTIME, THE FINANCIAL POSITION OF TIF THREE, SO WE ENDED THE, UH, LAST FISCAL YEAR AT LITTLE OVER 1.1 MILLION. UH, AND THEN, UH, THERE'S, UH, 167,000 WAS THE PROJECTED FUND BALANCE AT THE END OF THE CURRENT YEAR. AGAIN, BASED ON THE ASSUMPTIONS OF WHAT WE WOULD BE PAYING OUT TO BOTH THE DEVELOPER AND TIP, UH, EXCUSE ME, AND DART. SO FOR FUTURE MEETING DATES, UH, WE HAD SOME PROJECTED POTENTIAL DATES UP HERE, BUT, UM, IF, IF THE BOARD WOULD LIKE TO CONSIDER ANY OTHER DATES IN JULY, UM, OPEN TO THAT DISCUSSION WHEN WE TALK ABOUT NEXT YEAR'S BUDGET, WHICH I BELIEVE WE ARE LOOKING AT PERHAPS THE ALTERNATE DATE OF THURSDAY, THE 16TH OF JULY. THAT SOUNDS GREAT. MR. TAYLOR, I WILL PLAN TO SEND OUT, UH, A MEETING INVITE PROBABLY BY NEXT WEEK TO PENCIL THAT IN FOR, UH, FOR THE BOARD MEMBERS. I JUST HAD A GENERAL QUESTION ON ALL OF THE REPORTS HERE. UM, YOU KNOW, INTEREST INCOME HAS BEEN MENTIONED, BUT I, OF COURSE, I'M CURIOUS WHAT KIND OF RATE OF RETURN HAVE WE BEEN GETTING? UH, SO I'D HAVE TO LOOK AT FOR THIS SPECIFIC FUND, BUT IF YOU LOOK AT OUR INVESTMENT REPORT, UM, THAT WE POST QUARTERLY, UM, WE'VE BEEN BEATING TREASURY RATES. UM, WE WEREN'T FOR A PERIOD OF TIME WHEN, UH, RATES REALLY WENT UP QUICKLY. UH, BUT THE FACT THAT WE, WE GET INVESTMENTS OVER MULTIPLE YEARS, UM, WE'RE NOW AHEAD OF THE CURVE, SO TO SPEAK. AND SO, UM, WE'RE, WE'RE GETTING, I'D HAVE TO LOOK AT THE LAST REPORT TO GET THE EXACT NUMBERS, BUT I THINK WE WERE NORTH OF 3.7 OR 3.8% FOR THE LAST QUARTER, I BELIEVE. UM, UH, AND IT WAS EVEN WELL NORTH OF THAT LAST YEAR, UH, AS RATES HAVE COME DOWN, BUT I THINK AS YOU KNOW, WE'RE RESTRICTED YEAH. PUBLIC FUND INVESTMENT ACT OF WHAT WE CAN INVEST IN TO ESSENTIALLY ALL SAFE STUFF, RIGHT? YEAH. BACK SECURITIES AND SO FORTH. SO, YOU KNOW, WE WERE EARNING 5% AND PROBABLY 4% DURING A LOT OF THIS TIME. SO YEAH, IF YOUR QUESTION IS, WE'RE GONNA SEE THAT DROP PROBABLY. MM-HMM. YEAH. AND, AND OF COURSE AS OUR FUND BALANCE ADJUSTS IS, UH, THE SIGNIFICANT FACTOR IF WE SUDDENLY PAY IT ALL OUT TO BOTH DART AND WE ONLY HAVE A 50,000 OR A HUNDRED THOUSAND DOLLARS BALANCE, WE'LL SEE THOSE INTEREST NUMBERS ADJUSTED ACCORDINGLY IN THE SUMMER. YEP. OKAY. THANK YOU. OKAY. ARE THERE ANY OTHER, UH, BOARD MEMBERS WHO WOULD LIKE TO MAKE ANY FURTHER COMMENTS? NO. WELL, I THEN SAY THAT THAT CONCLUDES THE ITEMS ON THE AGENDA FOR THIS EVENING AND WITH NO FURTHER ITEMS TO DISCUSS. THIS MEETING IS ADJOURNED AT 6:47 PM. * This transcript was created by voice-to-text technology. The transcript has not been edited for errors or omissions, it is for reference only and is not the official minutes of the meeting.