In an unusual move, the city of Houston plans to reimburse as much as $20 million in costs for putting in public water and sewer lines, storm drainage systems, roads and parks in an effort to bolster economic development[1]. The city will provide funding and reimbursements to InTown Homes, a local developer, through its Housing and Community Development Department, a sector of government usually reserved for support for housing for “low-income Houstonians.” Andy Icken, Houston’s chief development officer, hopes that the funding will create growth in the community by boosting the local economy via the residents of these new homes, who will be “buying furniture and cars and groceries, sending their kids to local schools that get per-pupil state funding and paying sales and property taxes.” Icken views the subsidization for InTown Homes as a way for Houston to compete with the attractive aspects of the suburbs.
Icken has faced criticism for the decision because he has obtained funding for the reimbursements through “380 agreements,” which are typically used to lure developers into putting new housing projects inside city limits or to attract new businesses and employers[2]. InTown Homes is building new, gated communities in northwest Houston.
Do you think that the city should be offering these types of incentives to developers?
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[1] http://www.chron.com/disp/story.mpl/metropolitan/7470844.html
[2] http://www.bizjournals.com/houston/morning_call/2011/03/city-helps-subsidize-some-houston-home.html
