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The original item was published from 9/8/2022 4:49:31 PM to 3/14/2023 12:00:03 AM.

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Posted on: September 13, 2022

[ARCHIVED] Behind the budget: How does the City encourage development?

A woman stands at a podium with a projector screen behind her with information about Texas PACE

PHOTO: Texas Pace Authority President Charlene Heydinger shares information about the Texas Property Assessed Clean Energy (PACE) program with property owners and developers during a workshop Sept. 7 at the Leo J. Welder Center for the Performing Arts. This program helps property owners seek private loans for energy efficiency projects by providing reliable collateral in the form of voluntary property liens. No state or local tax dollars are used for the program.

A previous blog post explained that encouraging development is good for the City’s financial health because it creates new sources of tax revenue. Here are a few of the tools the City uses to encourage development:

Victoria Sales Tax Development Corporation

In 1995, Victoria voters approved a new half-cent sales tax to raise funds for economic and community development. The Victoria Sales Tax Development Corporation allocates these funds.

Not only do VSTDC-funded projects create more properties to be taxed, but many of them also increase economic activity, which creates more sales tax revenue to be used by the VSTDC for future projects.

Using VSTDC funds, the City….

  • Helped to relocate an exit ramp to provide access to the future site of Victoria Town Center. The developer will reimburse the City if certain revenue milestones are not met.
  • Installed a sewer line to allow the development of the new Texan gas station. This installation also opened up more land for future development.
  • Helped to fund the industrial park on Lone Tree Road, which played a key role in attracting Caterpillar and the forthcoming FedEx distribution center.

Connecting developers with other funding sources

The City helps developers leverage federal, state and private resources so that our local resources can be used for other things.

To connect developers with other funding sources, the City…

Making it easier for them

The City is in the process of revising and simplifying its development-related ordinances to create a single unified development ordinance. This ordinance will help to facilitate development by making our local development processes more user-friendly and easier to understand.

Enhancing livability

In addition to supporting development directly, the City also creates a positive environment for development by making Victoria a more attractive place to live, work and play. By pursuing the goals outlined in the community-driven 2035 Comprehensive Plan and master plans, the City sends a message to developers that Victoria is a great place to do business.

Following the Comprehensive Plan and the master plans, the City…

  • Partnered with local Girl Scout Izzy Drane and set aside VSTDC funds to build a new dog park within Riverside Park. The City will soon begin soliciting proposals for the construction of the dog park.
  • Partnered with the Victoria Fine Arts Association and Free Art Victoria to add crosswalk art downtown. This project was fully sponsored by local donors.
  • Established a tax increment reinvestment zone to encourage growth and reinvestment in Victoria’s downtown without raising taxes.
  • Through the Victoria Housing Finance Corporation, issued tax-exempt bonds to finance two new apartment complexes: Enchanted Gardens and the tentatively named Odem Street Apartments. These bonds must be repaid by the developers.

This year, about half of the City’s new property tax revenue came from developments or improvements. Developments shift the property tax burden away from homeowners while ensuring adequate funds for street repairs, facility improvements and more. To learn more about the newly adopted budget, visit

Sam Hankins is the communications specialist for the City of Victoria.

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