Smith County residents voiced opposition and support to creation of a special tax zone along Toll 49 that would dedicate millions of dollars to county road improvements and expedited completion of the toll project.
About 100 residents and officials filled a public hearing regarding a Transportation Reinvestment Zone along the Toll 49 corridor Friday morning.
Under the plan, revenues would be collected for 25 years on new construction within one mile on either side of the center of the two-lane Toll 49 rather than go into the Smith County general fund.
The zone would not raise taxes but rather funnel revenues created by new construction within the corridor.
Half of the tax revenue would go to Smith County for county road maintenance and improvements, while the other half would go to the North East Texas Regional Mobility Authority to expedite completion of future expansions of Toll 49.
The zone would generate an estimated $31 million to $41 million in revenue during its 25-year lifespan, based on the county’s current tax rate.
Proponents say the investment zone would help speed up completion of Toll 49, which they believe will relieve traffic congestion in surrounding communities and generate commercial and residential growth. They believe diversions now would provide revenue sources and return the investment decades into the future.
Opponents say the zone would allow the state to duck its obligation to fund road construction and maintenance sufficiently. They say the reinvestment zone taps local taxpayers to fund a toll road, and depending on commercialization of the corridor is a gamble. There is also concern about giving money to the mobility authority, which is governed by an unelected board.
Eight people spoke against the zone, while six supported it.
Resident Larry Terry, who owns land along the corridor, said the toll project has negatively impacted his property values by dissecting tracts of land. He believes the toll road presents a poor corridor for developers because access is limited to major thoroughfares, such as Texas Highway 64 and Old Jacksonville Highway.
Terry also said comparisons to the city of Tyler’s half-cent sales tax is inaccurate. The city has oversight of the sales tax, while half the money captured via the zone would go to the mobility authority board, which is appointed and represents 16 counties around the region. He fears a lack of local oversight would translate into problems for residents along the corridor and taxpayers.
“To me it looks like a model for waste, inefficiency and buck passing,” he said. “Voters traditionally have recourse but this would take it away for 25 years.”
Other residents expressed frustration with the plan because it siphons funds away from the county at a time when county roads are in neglect.
“How can you give any money for a state project when you can’t afford to maintain your county roads?” JoAnn Fleming, Grassroots America executive director, asked.
County Commissioner Jeff Warr, who supports creating the zone, said Toll 49 is no longer a state project but is locally owned and operated by regional taxpayers via the NETRMA. He said expediting completion of future segments of Toll 49 would relieve county and state roads, would move traffic quicker and safer and create opportunity for development.
Capturing the 80-acre development underway near south Broadway Avenue and Toll 49 would create a big, early boost for the zone, he said. Warr said having the zone finalized by Jan. 1 would ensure capture of new construction gains.
Warr said it makes long-term sense for the county to promote ways to increase development opportunities because it increases the tax base. The zone creates opportunity while investing new construction revenue toward infrastructure to abate rural-to-urban growing pains.
“We could capture 100 percent of nothing or move (completion of Toll 49) up 10 years and capture tax dollars created by new construction,” he said.
Lindale mayor Robert Nelson and former mayor Jim Mallory spoke in favor of the zone because it would expedite the Lindale Relief Route, which would create a route around the city.
They said U.S. Highway 69 and the city were not designed to handle the traffic moving through the city each day. Traffic creates gridlock along the route that includes two schools and dozens of businesses.
“We need to be proactive and take action now,” he said. “I would be opposed if some of the money was used in another county, but it’s for Smith County. The longer you wait, the larger the problem becomes.”
Tab Beall, a former NETRMA board member, said the success of Toll 49, which has exceeded traffic projections since connecting to Interstate 20, is a local success and one that will pay dividends to the region for decades. He agreed with opposition concerns regarding the state not meeting its funding obligations but stressed that Tyler and Smith County were competing with urban centers for limited transportation funding.
“This allows us to take control of our own destiny and an opportunity to do something at the local level,” he said.
But Tim Kane, a former University of Texas at Tyler economics professor, said commissioners should weigh the “costs” against the “benefits” of the zone.
The NETRMA could leverage revenues for borrowing capacity to build future segments. Kane worries that anticipated growth rates within the corridor might not meet the debt obligation, which would ultimately be taxpayers’ responsibility.
Warr called the growth estimates “conservative” because they did not include developments already underway, which represent millions of dollars in revenue.
He said the crossroads of major intersections would be hotspots for commercial development while residential building likely would occur between intersections.
Speculation puts taxpayers at risk, Kane said.
County Judge Joel Baker said he was pleased with the hearing. He expects more meetings to be held around the county at city council meetings. After the meeting he asked NETRMA officials if they would prepare for more presentations.
Baker said the commissioners court encourages public comment via phone call, email or in person throughout the 30-day period. He said public discussion would be critical to dispel any misinformation, hear public concerns and answer questions about the Transportation Reinvestment Zone.
“We’re interested in this opportunity to create a dedicated funding source for local road projects but we haven’t made up our minds on it,” he said. “It’s a local control issue, and we want to hear concerns and make an informed decision about something that will have a major impact on Smith County for decades.”