TIRZ increment capture

The interactive has two controls: a slider for the number of years since the TIRZ's base year, and a slider for your assumed annual appraisal growth rate. As you adjust them, the diagram shows how a property's total taxable value splits into two parts — and what the City of Houston does with each.

The bottom portion of the diagram (the “base value”) is frozen at the property's appraised value in the year the TIRZ was created. The City collects its regular rate ($0.519190/$100 for FY2026) on this amount, and those dollars go to the City of Houston General Fund normally — police, fire, parks, streets, debt service.

The top portion — everything above that frozen base-year line — is the “increment.” This is the appraised value your property has gained since the zone was created. The City still collects its rate on the increment. But those dollars don't go to the General Fund. They go to the TIRZ's Redevelopment Authority — a board whose members are appointed by the Mayor and confirmed by City Council, not elected — to fund infrastructure and redevelopment projects within the zone's boundaries.

Other taxing units — HISD, Harris County, the Flood Control District — typically keep their full share of the increment and are not affected by the TIRZ capture. The mechanism applies only to the City of Houston's portion.

What the sliders reveal is the compounding effect. After 20 years of 3% annual growth, well over half the property's taxable value may sit above the base-year line. A meaningful share of the City's levy on that property — potentially hundreds of dollars per year on a median home — is flowing to the neighborhood's redevelopment board rather than the General Fund. Multiply across every parcel in a large zone and the annual diversion can reach tens of millions of dollars.

Start by finding out whether your address sits inside a TIRZ. The City of Houston maintains an economic development page at houstontx.gov/ecodev listing all 28 active zones with their boundaries, creation dates, and Redevelopment Authority contacts. The HCAD parcel search (hcad.org) will show your parcel's full jurisdiction stack, including any TIRZ overlay.

If you're inside a TIRZ, the Redevelopment Authority for your zone is a public body and its meeting minutes, annual reports, and capital project lists are public records. TIRZ 21 (Hardy / Near Northside), for example, was created in 2003 with a 326.1-acre footprint and expanded in 2019 to add another 1,106 acres. The Near Northside Redevelopment Authority governs it. Its annual reports describe exactly what the captured increment has funded — street improvements, drainage, housing programs, specific project addresses and dollar amounts.

The governance question worth asking is straightforward: does the Redevelopment Authority's capital spending match what residents in the zone would prioritize if they had a direct vote? That's not a gotcha — it's the honest policy question the mechanism creates. The board is appointed, not elected; the projects are within zone boundaries, but the spending priorities are set without a direct ballot. Whether that's an acceptable tradeoff depends on what the zone has actually built.

If you're outside a TIRZ and want to understand City budget dynamics, the practical implication is simpler: the City General Fund is smaller than it would be if every parcel's City levy went directly to it. The cumulative TIRZ capture across all 28 zones is a meaningful share of what could otherwise be discretionary City revenue. Houston's revenue cap (Prop 1, 2004) already constrains General Fund growth; TIRZ increment further reduces the taxable base available to it.

Tax Increment Reinvestment Zones are authorized by Texas Tax Code Chapter 311 — first enacted in 1981 as Texas's version of the broader Tax Increment Financing (TIF) mechanism that emerged nationally after the 1970s urban renewal era. The statute defines “increment” (§311.012), the collection mechanism (§311.013), and board composition (§311.0091 — the provision that makes appointment, not election, the governance model). All three sections are at statutes.capitol.texas.gov.

The City of Houston rate used in this interactive ($0.519190 per $100) is the adopted FY2026 rate, parsed from the City of Houston FY2026 Adopted Budget. TIRZ 21's creation and expansion dates are from Houston City Council Ordinances 2003-1258 (creation, 326.1 acres) and 2019-0994 (expansion, +1,106.54 acres).

Houston has 28 active TIRZs as of 2025. They range from downtown/inner-loop urban renewal zones (TIRZs 1, 3, 5, 7, 9, 17) to inner-ring residential zones (TIRZs 15, 21) to industrial and port-adjacent zones — created across four decades, each with its own base year, boundary, and outstanding capital commitments.

One open research question for the episode: the total annual increment captured across all 28 zones in FY2024 (a single statewide figure) would sharpen the “how big is this?” framing. That figure is in the City of Houston Economic Development TIRZ financial reports and the Texas Comptroller's annual TIRZ financial report (required under Tax Code §311.016). The episode brief (docs file 12_ep2_tirz.md) flags this as gap-fill item #1 before recording.