McKinney council expands downtown tax zone amid revenue debate

McKinney leaders voted to expand the downtown tax increment reinvestment zone after a meeting that turned on a basic question of city finance: should future growth dollars stay concentrated in historic downtown, or should they be spread across broader city needs?

The council took up amendments to the project plan and the administration policy and guidelines for Tax Increment Reinvestment Zone Number One, known as TIRZ 1, during its regular June 16 meeting at City Hall, 401 E. Virginia St. Under Texas tax increment financing, the city can direct the increase in property-tax revenue generated inside a defined zone back into that same area, helping pay for infrastructure, redevelopment and public improvements. Supporters argue that keeps downtown McKinney competitive; critics see a tradeoff when new value is locked into one part of the city instead of helping fund services elsewhere.

McKinney’s downtown strategy traces to an early-2000s Town Center study, after which the city adopted a new form-based code and a series of reinvestment programs to encourage economic growth while preserving the historic core. The city describes TIRZ 1 as one of the incentives in that broader effort, alongside tools that already allow downtown businesses to use sidewalk cafés, sidewalk patios and parklets. The expansion signals that council members want to keep leaning into the downtown model even as other parts of the city also compete for tax dollars.

That balancing act is showing up in other downtown decisions too. The city has been piloting digital parking signs to show real-time availability, and council recently paused parking-garage discussions even as current plans for city-owned property still leave room for a possible garage and office uses on the former City Hall site. Together, those moves suggest McKinney is trying to solve the same problem from several angles: how to support downtown traffic, retail and public access without turning every improvement into a fight over who pays.

The June 16 meeting also brought a change in council leadership. Geré Feltus stepped aside as mayor pro tem after two years, and the council elected Rick Franklin to the post, which McKinney’s charter says is filled once a year at the first regular June meeting. Feltus, elected in 2021 to represent District 3, had been appointed mayor pro tem in June 2024 and previously served with the McKinney Economic Development Corporation and other local boards, underscoring how closely downtown reinvestment remains tied to the city’s economic-development politics.