loop 20 trz area economic and geographic context · an analysis of city of laredo building permit...

Loop 20 TRZ Area Economic and Geographic Context

The Webb County-City of laredo Regional Mobility Authority is interested in designing and constructing

improvements along a portion of loop 20 (Cuatro Vientos) between US 59 to US 83. Based on initial

plans, the Loop 20 improvements would include four new overpasses (see map at end of this report in

Appendix) as well a southern extension of Cuatro Vientos to US 83. Currently, loop 20 terminates at

Mangana-Hein Road. In addition, a potential loop 20 TRZ would include the area west of Loop 20 from

US 83 to the proposed Bridge #5. The new international crossing would serve as an alternative route for

passenger vehicle, as well as tractor trailer traffic and help spur industrial and commercial development

in the surrounding area, as well as possibly along the proposed corridor. TXP assumed this new bridge

crossing would not open for 10 years.

Based on initial feedback from stakeholders, the proposed loop 20 TRZ is divided into two components:

• loop 20 (Cuat ro Vientos) from US 59 to US 83 and

• Cuatro Vientos west from US 83 to the proposed Bridge #5.

TXP began the analysis by creating a 1-mile buffer on each side of the loop 20 alignment for a total

width of two miles. TXP excluded all parcels north of US 59. As with past studies, if any portion of the

buffer touched a parcel, the entire parcel was included in this analysis. This results in very large

rectangular parcels being includecf.

Because TRZs capture future real property tax increment, the focus of any preliminary forecast should

be on undeveloped areas that are likely to attract new residential and commercial construction over the

next 10 to 20 years. However, transportation projects such as the contemplated loop 20 improvements

shou ld have a positive impact on existing neighborhoods and surrounding parcels. How to craft a TRZ

boundary that captures future growth while not drawing a boundary that is too big is an iterative

process. The area between US 59 and State Highway 359 is good example of this issue. To simplify the

preliminary TRZ forecast, this entire area was included in the loop 20 TRZ boundary. If the City of Laredo

decides to implement a Loop 20 TRZ, this area should be examined for what should be included and

excluded.

TXP had several conversations with landowners and rea l estate stakeholders related to loop 20 and

regional infrastructure. Long-term forecasts, in general, assume that the public sector continues to

invest in infrastructure (ex. utilit ies and schools). A potential limiting inf rastructure issue discussed in the

southern and southeastern portion of t he study area is current waste water infrastructure as well as

overall capacity at sewer treatment plants. TXP spoke with City of Laredo Utilities Department staff

about these issues. While there are current gaps in terms of existing infrastructure or access that could

limit short-term growth, TXP has assumed this infrastructure issue is resolved over the long-term.

1310 South 1•l Street, Suite 'i05 Austin , Texas 78704 (512) 328-8300 phone (5'12) 462-'1240 fax www.txp.com

The proposed Loop 20 TRZ encompasses a combined 31,132.4 parce l acres. Not all the parcels fall within

the City of Laredo city limits. However, all the parcels are within the City of Laredo extraterritorial

jurisdiction (ETJ). To include the properties currently within the ETJ as part of a TRZ, the City of Laredo

would need to annex these properties. In the forecast ana lysis which follows, it is assumed that all

properties within the TRZ would be annexed prior to its creation. TXP also excluded any properties that

were outside of the Laredo ETJ (ex. Rio Bravo).

Table 1: US 59 to US 83 1-Mile Buffer Parcel Data (2017) Code Description Parcels Acreage Webb County City of Laredo A Single-Family Residential 11,476 1,701.9 $1,035,505,279 $1,054,083,385 B Multifamily Residential 66 29.0 $39,245,420 $39,245,420 c Vacant Lots & Tracts 1,097 460.8 $58,229,431 $57,851,161 D Qualified Open-space 82 20,575.2 $2,071,854 $1,132,712

E Rural Land, not Qualified 96 2,942.2 $32,448,125 $31,107,079 F Commercial & Industrial 214 519.9 $161,162,388 $157,555,168

J Utilities 7 11.2 $446,710 $356,350 0 Residential Inventory 174 20.3 $7,023,990 $7,023,990 X Exempt Property 571 1,263.2 $0 $1,272,745 (blank) Missing Data 61 26.8 N/D N/D

Total 13,844 27,550.6 $1,336,133,197 $1,349,628,010 Source: TXP, Webb County Appraisal District

Table 2: US 83 to Bridge #5 1-Mile Buffer Parcel Data (2017)* Code Description Parcels Acreage Webb County City of Laredo D Qualified Open-space 4 3,289.6 $123,350 N/A

E Rural Land, not Qualified 1 244.0 $268,890 N/A

X Exempt Property 4 48.2 $0 N/A Total 9 3,581.8 $392,240 N/A

Source: TXP, Webb County Appraisa l District

• TXP excluded properties within the Cities of Rio Bravo and El Cenizo within the 1-mi le buffer

The following pages contain a series of maps the depict the Loop 20 TRZ boundary or Study Area,

current land use patterns, master plans, and City of Laredo city limits.

1310 South 151 Street, Suite 105 1 Austin, Texas 78704 1 (512) 328-8300 phone 1 (512) 462-1 240 fax 1 www.txp.com

Figure 1: loop 20 Alignment and City of laredo City limit

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Source: TXP, Inc.

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......... ~ • •• ,,:Laredo City Limits

- US 83 to Bridge #5

- US59toUS83

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1310 South 1st Street, Suite 105 1 Austin, Texas 78704 1 (51 2) 328-8300 phone 1 (512) 462-1240 fax I www.txp.com

Figure 2: loop 20 Alignment and 1-Mile TRZ Buffers

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Source: TXP, Inc.

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......... ~ ••• ,,;Laredo City Limits


US 83 to Bridge 1-Mile Buffer

- US 59 to US 83

US 59 to US 83 1-Mile Buffer

Esri, HERE. Delorme, Mapmylndia, C OpenStreetMap contributors. and the GIS user community

1310 South 1st Street, Suite 105 1 Austin, Texas 78704 1 (512) 328-8300 phone 1 (512) 462-1240 fax 1 www.txp.com

Figure 3: Loop 20 TRZ Buffers and Flood Zones

Source: TXP, Inc.

- Flood Zones

·· · ··~ i..,.,,: Laredo City Limits


US 83 to Bridge 1-Mile Buffer

- US59toUS83

US 59 to US 83 1-Mile Buffer

1310 South P 1 Street, Suite 105 1 Austin, Texas 78704 1 (512) 328-8300 phone 1 (512) 462-1 240 fax 1 www.txp.com

Figure 4: Loop 20 TRZ Study Area Parcels

Source: TXP, Inc.

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......... -, ! Laredo City Limits ....... - US 83 to Bridge #5

- US59toUS83

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131 0 South 1st Street, Suite 105 1 Austin, Texas 78704 1 (512) 328-8300 phone 1 (512) 462-1240 fax 1 www.txp.com

Figure 5: Undeveloped land within Loop 20 TRZ Buffers

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......... i..,. ,,: Laredo City Limits


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Figure 6: Documented Master Plans and Future Development

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Source: TXP, Inc.

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i •••• , i,., • . l Laredo City Limits


- US59toUS83

D Master Plans

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Webb County Demographic & Economic Context

Currently, Webb County is home to nearly 274,794 people. Total county population has doubled since

1990, a compound annual growth rate (CAGR) of 2.7 percent. Over this same period, the State of Texas

population CAGR was 1.7 percent. The City of Laredo is also growing at a similar pace, adding

approximately 70,000 residents since 2000. Overall population growth has slowed since the rapid

expansion experienced in the 1990s. Since 2010, Webb County has grown at CAGR of 1.3 percent.

Between 2016 and 2017, total county population growth was less than 1.0 percent. Looking to the

future, countywide annual population growth will likely remain between 1.0 and 1.5 percent without

the development of catalytic projects. However, sub-regions of the county could grow faster or slower.

Combining socioeconomic data from the Laredo Metropolitan Planning Organization and residential

parcel counts, TXP estimates there are approximately 11,000 households and 44,000 residents living in

the Loop 20 buffer area. Between 2013 and 2017, approximately 1,300 building permits were issued by

the City of Laredo for projects within the Loop 20 TRZ area. This translates into 265 new single-family

homes per year.

Webb County businesses now employ over 100,000 workers, an increase of 30,000 jobs since 2000.

Total county employment expanded at a CAGR of 2.4 percent over the past 17 years. Overall growth has

surpassed the State ofTexas CAGR of 1.5 percent over this period. Similar to population trends,

employment growth has noticeably slowed from the peak during the 1990s. Projected employment

growth should move in tandem with population growth.

The real estate market in Webb County has followed population growth within the region as a whole.

After significant growth in the 1990s through the mid-2000s, single-family home starts declined from

2006 to 2010. The market stabilized in 2011 and 2012, with new single-family home starts improving

year over year. Over the past 5 years, an average of 1,000 single-family homes per year have been built

in Webb County. The average cost of a new single-family home in Webb County excluding land is

$164,523. A number of multi-family projects have been completed too. When multi-family units are

included, the 5-year average for total new residential units in Webb County is 1,500. The average cost of

a new blended household unit (single-family and multifamily) excluding land is $130,937.

An analysis of City of Laredo building permit data for residential projects within the Loop 20 TRZ area

indicates the mean permit valuation was $125,972. For 2017, the average taxable single-family Loop 20

TRZ parcel was $91,851. The difference between these two values can be attributed to the age of

existing housing stock as well as a relatively high number of mobile home properties within the study

area. Stakeholders interviewed indicated, however, that a variety of factors are encouraging

homebuilders to construct more expensive housing units in south Laredo.

Page9

1310 South 151 Street, Suite 105 1 Austin, Texas 78704 1 (512) 328-8300 phone 1 (512) 462-1240 fax 1 www.txp.com

Figure 7: Webb County Population

300,000

250,000

200,000

150,000

100,000

50,000

0 0 rl N ('() <:t 0 0 0 0 0 0 0 0 0 0 N N N N N

Source: US Census Bureau

Figure 8: Population Growth Rate

3.5%

3.0%

2.5%

2.0%

1.5%

1.0%

0.5%

0 .0% 0 ..-i N ('() <:t ll) 0 0 0 0 0 0 0 0 0 0 0 0 N N N N N N

Source: US Census Bureau

ll) <D " 0 0 0 0 0 0 N N N

\0 " 0 0 0 0 N N

00 CTl 0 rl N ('() <:t ll) <D " 0 0 ..-i rl ..-i rl rl rl ..-i ..-i 0 0 0 0 0 0 0 0 0 0 N N N N N N N N N N

I 00 CTl 0 rl N ('() <:t ll) <D " 0 0 rl rl rl rl rl ..-i rl ..-i 0 0 0 0 0 0 0 0 0 0 N N N N N N N N N N


Figure 9: Webb County Total Employment

120,000

100,000

80,000

60,000

40,000

20,000

0 0 .-< N ff) <:t l/') <D 0 0 0 0 0 0 0 0 0 0 0 0 0 0 N N N N N N N

Source: Texas Workforce Commission

,.... 0() en 0 0 0 0 ..... 0 0 0 0 N N N N

Figure 10: Webb County Annual Employment Growth Rate

7.0%

6.0%

5.0%

4.0%

3.0%

2.0% I I I 1.0%

0.0% I -1.0%

-2.0%

-3.0%

-4.0% 0 .-< N ff) <:t l/') <D ,.... 0() en 0 0 0 0 0 0 0 0 0 0 0 .-< 0 0 0 0 0 0 0 0 0 0 0 N N N N N N N N N N N

Source: Texas Workforce Commission

..... N ff) <:t l/') <D ,....

..... ..... .-< ..... ..... ..... ..... 0 0 0 0 0 0 0 N N N N N N N

..... N ff) <:t l/') <D ,....

..... ..... .-< ..... .-< .-< ..... 0 0 0 0 0 0 0 N N N N N N N

1310 South 151 Street, Suite 105 1 Austin, Texas 78704 1 (512) 328-8300 phone 1 (512) 462-1240 fax I www.txp.com

Figure 11: Residential Building Permit Activity between 2013 and 2017

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Source: TXP, Inc.

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New Residential Permit Activity ., .... "" •..... l Laredo City Limits


- US 59 to US 83

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1310 South 151 Street, Suite 105 1 Austin, Texas 78704 1 (512) 328-8300 phone 1 (512} 462-1240 fax 1 www.txp.com

Figure 12: Single-Family Home Building Permits in Webb County

2,500

2,000

1,500

1,000

500

II 0 0 ..-< N m <:t ll) \D ,.... 00 01 0 ..-< N m <:t ll) 01 01 01 01 01 01 01 01 01 01 0 0 0 0 0 0 01 01 01 01 01 01 01 01 01 01 0 0 0 0 0 0 ..-< ..-< ..-< ..-< ..-< ..-< ..-< ..-< ..-< ..-< N N N N N N

Source: Real Est ate Center at Texas A&M University

Figure 13: Average Value per Single Family Dwelling Unit

$250,000

$200,000

$150,000

$100,000

$50,000

I I I I I I I I I I $0 0 .-t N ('(') <:t ll) \D ,.... 00 01 0 ..-< N m <:t ll) 01 01 01 01 01 01 01 01 01 01 0 0 0 0 0 0 01 01 01 01 01 01 01 01 01 01 0 0 0 0 0 0 rl .-t .-t M ..-< ..-< ..... ..... ..... ..... N N N N N N

Source: Real Estate Center at Texas A&M University

\D ,.... 00 0 0 0 0 0 0 N N N

\D ,.... 00 0 0 0 0 0 0 N N N

I I 01 0 ..-< N m <:t ll) \D ,.... 0 ..-< ..-< ..-< ..-< ..-< ..-< ..-< ..-< 0 0 0 0 0 0 0 0 0 N N N N N N N N N

01 0 ..-< N m <:t ll) \D ,.... 0 ..-< ..-< ..-< ..-< ..-< ..-< ..-< ..-< 0 0 0 0 0 0 0 0 0 N N N N N N N N N


Figure 14: Total Building Permits for Single and Multifamily in Webb County

3,000

2,500

2,000

1,500

1,000

500 I 0 0 ..... N ('() '<!" ll) 1.0 ,..... 00 0'1 0 ..... N ('() '<!" ll) 1.0 ,..... 00 0'1 0 ..... N 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0 0 0 0 0 0 0 0 0 0 ..... ..... ..... 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0 0 0 0 0 0 0 0 0 0 0 0 0 ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... N N N N N N N N N N N N N

Source: Rea l Estate Center at Texas A&M University

Figure 15: Average Value per Single and Multifamily in Webb County

$200,000

$180,000

$160,000

$140,000

$120,000

$100,000

$80,000

$60,000

$40,000

I Ill II II $20,000 I $0 0 ...... N ('() '<!" ll) 1.0 ,..... 00 0'1 0 ..... N ('() '<!" ll) 1.0 ,..... 00 0'1 0 ..... N 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0 0 0 0 0 0 0 0 0 0 ..... ..... ..... 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0'1 0 0 0 0 0 0 0 0 0 0 0 0 0 ..... ...... ..... ..... rl ..... rl rl rl rl N N N N N N N N N N N N N

Source: Real Estate Center at Texas A&M University

('() '<!" ll) 1.0 ,..... ..... ...... ..... ..... ..... 0 0 0 0 0 N N N N N

('() '<!" ll) 1.0 ,..... rl ..... ..... ..... ..... 0 0 0 0 0 N N N N N

1310 South 151 Street, Suite 105 1 Austin , Texas 78704 1 (512) 328-8300 phone 1 (512) 462-1 240 fax 1 www.txp.com

Webb County Growth & TRZ Revenue Forecast

Building on the socioeconomic and appraisal district data, TXP compared and analyzed several existing

population and employment forecasts for Webb County. Over the next 30 years, the consensus is that

Webb County population is projected to grow at a CAGR of 1.3 percent to 1.9 percent. Based on the US

Census Bureau 2017 population estimate for Webb County, the Texas State Data Center 0.0 Scenario is

the most applicable. The zero scenario assumes that inmigration and outmigration are equal (i.e., net

migration is zero) resulting in growth only through natural increase (the excess or deficit of births

relative to deaths). This scenario is commonly used as a base in population projections and is useful in

indicating what an area's indigenous growth (growth due only to natural increase) will be over

time. In general, this scenario produces the lowest population projection for counties with historical

patterns of population growth through net inmigration and the highest population projection

for counties with historical patterns of population decline through net outmigration.

Table 3: Projected Webb County Population Growth

Year Laredo MPO TSDC (0.0) TSDC (0.5) TSDC (1.0)

2018 286,442 283,980 293,787 303,060

2030 350,136 338,098 367,576 392,768

2035 413,907 381,800 429,823 464,297

2045 450,024 403,660 461,563 497,796

CAGR 2018 to 2045 1.7% 1.3%. 1.7% 1.9% Source: Laredo M etropolitan Planning Organization, Texas State Data Center (TSDC), and Texas Water Development Board (TW DB)

Unlike population forecasts, which are produced by a few public and private sources, employment

forecasts are not as readily available. TXP compared employment forecasts produced by the Laredo

MPO, Moody's Analytics, and the Texas Workforce Commission. TXP interpolated and adjusted these

datasets to allow a comparison to be made. Similar to the past 25 years, employment growth is

projected to slightly outpace population growth.

Table 4: Projected Webb County Employment Growth

Texas Workforce Year Laredo MPO Moody's Commission*

2018 105,267 107,193 121,760

2025 120,976 116,132 140,338 2030 133,613 N/A N/A

2045 180,009 N/A N/A CAGR (18 to 25) 2.0% 1.2% 2.0%

Source: Laredo Met ropolitan Planning Organization, Moody's Analytics, Woods & Poole Economics, Inc.

* South Texas WDA - employment by industry- Jim Hogg, Webb, and Zapata Counties

TXP obtained the Laredo Metropolitan Planning Organization's socioeconomic forecast for small areas

called traffic analysis zones (TAZ). TXP incorporated this information in the tax increment forecast

scenarios. The following maps depict the TAZs that overlap the Loop 20 TRZ.

1310 South pt Street, Suite 105 1 Austin, Texas 78704 1 (512) 328-8300 phone 1 (512) 462-1240 fax 1 www.txp.com

Figure 15: Traffic Analysis Zones near Loop 20 TRZ Buffers

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Source: TXP, Inc.

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j Traffic Analysis Zones ......... i. • .• . .: Laredo City Limits


- US59toUS83

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1310 South 1st Street, Suite 105 1 Austin, Texas 78704 1 (512) 328-8300 phone 1 {512) 462-1240 fax 1 www.txp.com

Figure 16: Traffic Analysis Zones Net Change in Households 2018 to 2045

Sou rce : TXP, Inc.

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Net Household Change 2018 to 2045

- 0 - 50

51 · t OO

L1 1o1 - 25o

- 251- 500

- 501 · 1100

Esn, HERE, Del orme, Mapmylndoa, 0 OpenStreetMap contributors and the GIS user community

1310 South 151 Street, Suite 105 1 Austin, Texas 78704 1 (512) 328-8300 phone 1 (512) 462-1 240 fax 1 www.txp.com

Figure 17: Traffic Analysis Zones Net Change in Employment 2018 to 2045

# ,, #'

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....• ~ •• ,i Laredo City Limits

- us 83to Bridge 115

- US59toUS83

Net Employment Change 2018 to 2045

- 0-50

- 5t - t 00

LJ tot - 250

251 - 500

- 501-708

Esri, HERE, Delorme, Mapmylncha, C OpenStreetMap contributors. and the GIS user

1310 South pt Street, Suite 105 1 Austin , Texas 78704 1 (512) 328-8300 phone 1 (51 2) 462-1240 fax 1 www.txp.com

Revenue Forecast Scenarios

TXP has developed three revenue forecasts for a hypothetical Loop 20 TRZ. The three scenarios are

described below. To be consistent with past RMA TRZ studies, TRZ has projected revenue over 30 years.

Because the City of Laredo needs financial resources to provide basic services to city residents and

businesses, it is unlikely that the City of Laredo would contribute 100 percent of the future increment to

a TRZ. However, to illustrate the order of magnitude a Loop 20 TRZ could generate, TXP has calculated

the potential tax revenue contribution in 10 percent increments. TXP used the following assumptions in

each of the forecast scenarios:

• The 2017 City of Laredo property tax rate of $0.637 per $100 valuation remained constant.

• A 5.0 percent discount rate was used for the net present value (NPV) calculations.

• A 3.0 percent appreciation/inflation rate was used for residential and commercial values.

• The baseline value for the Loop 20 TRZ is the 2017 taxable value of total real property or

$1,336,525,437. Certified 2018 values are not available. Given the uncertainty of including

existing development between US 59 and State Highway 359 in the Loop 200 TRZ, TXP assumed

no appreciation of the 2017 baseline in any forecast scenario.

• Development around the proposed Bridge #5 would begin in 2028. TXP modeled development

around Bridge #5 based on the Vallecillo Road TRZ analysis. All three scenarios use the

development pattern and valuation for the US 83 to the proposed Bridge #5 segment.

• For all three scenarios, TXP used the current taxable value of commercial+ industrial real

property per worker of $37,252 ($2017).

Loop 20 TRZ revenue scenarios:

• Scenario 1 uses the most recent five-year pattern of residential building permits within the TRZ

buffer area to project household growth. TXP held the countywide ratio of population to

employment constant for 30 years.

• Scenario 2 combines the Laredo MPO TAZ forecast data with estimated home value based on

stakeholder feedback. The consensus was south Laredo would begin attracting a more

expensive housing product than in the past. This scenario assumes a new home is taxed at

$125,000 ($2017).

1310 South 1'1 Street, Suite 105 1 Austin , Texas 78704 1 (512) 328-8300 phone 1 (51 2) 462-1 240 fax 1 www.txp.com

• Scenario 3 also uses the Laredo MPO TAZ forecast, but the starting residential value for new

units is based on the existing 2017 average value of roughly $100,000 for the buffer area (house

plus land). This reflects uncertainty over how many mobile home units will be attracted to this

area and the tax law about whether or not the mobile home is treated as real or private

property.


Table 5: Scenario 1 Projected 30 Year Tax Revenue for a Hypothetical Loop 20 TRZ

I

Taxes Period Year Paid Year 10% Allocation 20% Allocation 30% Allocation 40% Allocation 50% Allocation

0 2018 Baseline

1 2019 2020 $26,439 $52,877 $79,316 $105,754 $132,193

2 2020 2021 $54,464 $108,927 $163,391 $217,854 $272,318

3 2021 2022 $84,146 $168,292 $252,439 $336,585 $420,731

4 2022 2023 $115,561 $231,122 $346,682 $462,243 $577,804

5 2023 2024 $148,784 $297,569 $446,353 $595,138 $743,922

6 2024 2025 $183,898 $367,795 $551,693 $735,590 $919,488

7 2025 2026 $220,984 $441,967 $662,951 $883,934 $1,104,918

8 2026 2027 $260,129 $520,259 $780,388 $1,040,517 $1,300,646

9 2027 2028 $301,425 $602,850 $904,274 $1,205,699 $1,507,124

10 2028 2029 $357,821 $715,642 $1,073,463 $1,431,284 $1,789,104

11 2029 2030 $417,329 $834,659 $1,251,988 $1,669,318 $2,086,647

12 2030 2031 $480,086 $960,173 $1,440,259 $1,920,346 $2,400,432

13 2031 2032 $546,233 $1,092,467 $1,638,700 $2,184,933 $2,731,167

14 2032 2033 $615,917 $1,231,834 $1,847,751 $2,463,668 $3,079,585

15 2033 2034 $689,290 $1,378,580 $2,067,870 $2,757,160 $3,446,449

16 2034 2035 $766,511 $1,533,022 $2,299,533 $3,066,044 $3,832,555

17 2035 2036 $847,745 $1,695,490 $2,543,235 $3,390,980 $4,238,724

18 2036 2037 $933,163 $1,866,326 $2,799,489 $3,732,652 $4,665,815

19 2037 2038 $1,022,943 $2,045,887 $3,068,830 $4,091,773 $5,114,716

20 2038 2039 $1,117,270 $2,234,541 $3,351,811 $4,469,082 $5,586,352

21 2039 2040 $1,216,337 $2,432,673 $3,649,010 $4,865,347 $6,081,683

22 2040 2041 $1,320,341 $2,640,683 $3,961,024 $5,281,365 $6,601,706

23 2041 2042 $1,429,491 $2,858,983 $4,288,474 $5,717,966 $7,147,457

24 2042 2043 $1,544,002 $3,088,005 $4,632,007 $6,176,009 $7,720,012

25 2043 2044 $1,664,097 $3,328,195 $4,992,292 $6,656,389 $8,320,487

26 2044 2045 $1,790,008 $3,580,017 $5,370,025 $7,160,034 $8,950,042

27 2045 2046 $1,921,977 $3,843,953 $5,765,930 $7,687,906 $9,609,883

28 2046 2047 $2,060,252 $4,120,503 $6,180,755 $8,241,007 $10,301,259

29 2047 2048 $2,205,094 $4,410,187 $6,615,281 $8,820,375 $11,025,468

30 2048 2049 $2,356,772 $4,713,544 $7,070,315 $9,427,087 $11,783,859

Total $26,698,510 $53,397,020 $80,095,529 $106,794,039 $133,492,549

NPV@ 5% $9,569,864 $19,139,728 $28,709,592 $38,279,456 $47,849,320 Source: TXP, Inc.

1310 South 151 Street, Suite 105 1 Austin , Texas 78704 1 (512) 328-8300 phone 1 (512) 462-1240 fax I www.txp.com

Table 6: Scenario 2 Projected 30 Year Tax Revenue for a Hypothetical loop 20 TRZ Taxes

Period Year Paid Year 10% Allocation 20% Allocation 30% Allocation 40% Allocation 50% Allocation

0 2018 Baseline

1 2019 2020 $45,037 $90,074 $135,111 $180,148 $225,185

2 2020 2021 $92,776 $185,552 $278,328 $371,104 $463,880

3 2021 2022 $143,339 $286,678 $430,017 $573,356 $716,695

4 2022 2023 $196,852 $393,704 $590,557 $787,409 $984,261

5 2023 2024 $253,447 $506,894 $760,342 $1,013,789 $1,267,236

6 2024 2025 $313,261 $626,521 $939,782 $1,253,043 $1,566,304

7 2025 2026 $376,435 $752,870 $1,129,305 $1,505,740 $1,882,175

8 2026 2027 $443,118 $886,236 $1,329,353 $1,772,471 $2,215,589

9 2027 2028 $513,463 $1,026,925 $1,540,388 $2,053,851 $2,567,314

10 2028 2029 $600,486 $1,200,973 $1,801,459 $2,401,946 $3,002,432

11 2029 2030 $692,270 $1,384,539 $2,076,809 $2,769,078 $3,461,348

12 2030 2031 $789,019 $1,578,038 $2,367,057 $3,156,077 $3,945,096

13 2031 2032 $916,383 $1,832,766 $2,749,149 $3,665,532 $4,581,915

14 2032 2033 $1,050,679 $2,101,357 $3,152,036 $4,202,714 $5,253,393

15 2033 2034 $1,192,207 $2,384,414 $3,576,621 $4,768,828 $5,961,035

16 2034 2035 $1,341,282 $2,682,563 $4,023,845 $5,365,127 $6,706,408

17 2035 2036 $1,498,228 $2,996,456 $4,494,683 $5,992,911 $7,491,139

18 2036 2037 $1,663,384 $3,326,767 $4,990,151 $6,653,534 $8,316,918

19 2037 2038 $1,837,100 $3,674,200 $5,511,301 $7,348,401 $9,185,501

20 2038 2039 $2,019,743 $4,039,486 $6,059,229 $8,078,971 $10,098,714

21 2039 2040 $2,211,691 $4,423,381 $6,635,072 $8,846,763 $11,058,453

22 2040 2041 $2,413,338 $4,826,675 $7,240,013 $9,653,350 $12,066,688

23 2041 2042 $2,636,059 $5,272,117 $7,908,176 $10,544,234 $13,180,293

24 2042 2043 $2,869,971 $5,739,942 $8,609,912 $11,479,883 $14,349,854

25 2043 2044 $3,115,545 $6,231,091 $9,346,636 $12,462,181 $15,577,726

26 2044 2045 $3,373,271 $6,746,543 $10,119,814 $13,493,085 $16,866,356

27 2045 2046 $3,643,657 $7,287,314 $10,930,971 $14,574,627 $18,218,284

28 2046 2047 $3,927,230 $7,854,459 $11,781,689 $15,708,919 $19,636,148

29 2047 2048 $4,224,537 $8,449,075 $12,673,612 $16,898,150 $21,122,687

30 2048 2049 $4,536,149 $9,072,299 $13,608,448 $18,144,597 $22,680,746

Total $48,929,955 $97,859,909 $146,789,864 $195,719,819 $244,649,773

NPV @ 5% $17,283,345 $34,566,690 $51,850,035 $69,133,380 $86,416,725 Source: TXP, Inc.

1310 South 1st Street , Suite 105 1 Austin , Texas 78704 1 (512} 328-8300 phone 1 (512) 462-1240 fax 1 www.txp.com

Table 7: Scenario 3 Projected 30 Year Tax Revenue for a Hypothetical Loop 20 TRZ Taxes

Period Year Paid Year 10% Allocation 20% Allocation 30% Allocation 40% Allocation 50% Allocation

0 2018 Baseline

1 2019 2020 $38,056 $76,113 $114,169 $152,226 $190,282

2 2020 2021 $78,396 $156,793 $235,189 $313,585 $391,981

3 2021 2022 $121,122 $242,245 $363,367 $484,489 $605,611

4 2022 2023 $166,341 $332,683 $499,024 $665,365 $831,706

5 2023 2024 $214,164 $428,329 $642,493 $856,657 $1,070,822

6 2024 2025 $264,707 $529,414 $794,121 $1,058,829 $1,323,536

7 2025 2026 $318,090 $636,180 $954,269 $1,272,359 $1,590,449

8 2026 2027 $374,437 $748,874 $1,123,311 $1,497,748 $1,872,185

9 2027 2028 $433,879 $867,758 $1,301,637 $1,735,516 $2,169,395

10 2028 2029 $509,407 $1,018,815 $1,528,222 $2,037,629 $2,547,037

11 2029 2030 $589,077 $1,178,154 $1,767,231 $2,356,307 $2,945,384

12 2030 2031 $673,068 $1,346,136 $2,019,204 $2,692,272 $3,365,341

13 2031 2032 $783,112 $1,566,225 $2,349,337 $3,132,449 $3,915,561

14 2032 2033 $899,153 $1,798,307 $2,697,460 $3,596,613 $4,495,767

15 2033 2034 $1,021,452 $2,042,904 $3,064,356 $4,085,808 $5,107,261

16 2034 2035 $1,150,280 $2,300,559 $3,450,839 $4,601,118 $5,751,398

17 2035 2036 $1,285,917 $2,571,835 $3,857,752 $5,143,669 $6,429,586

18 2036 2037 $1,428,658 $2,857,316 $4,285,974 $5,714,632 $7,143,290

19 2037 2038 $1,578,806 $3,157,612 $4,736,418 $6,315,224 $7,894,030

20 2038 2039 $1,736,677 $3,473,354 $5,210,031 $6,946,708 $8,683,385

21 2039 2040 $1,902,599 $3,805,198 $5,707,798 $7,610,397 $9,512,996

22 2040 2041 $2,076,914 $4,153,828 $6,230,742 $8,307,656 $10,384,569

23 2041 2042 $2,267,535 $4,535,071 $6,802,606 $9,070,142 $11,337,677

24 2042 2043 $2,467,725 $4,935,450 $7,403,176 $9,870,901 $12,338,626

25 2043 2044 $2,677,885 $5,355,771 $8,033,656 $10,711,542 $13,389,427

26 2044 2045 $2,898,434 $5,796,869 $8,695,303 $11,593,738 $14,492,172

27 2045 2046 $3,129,806 $6,259,612 $9,389,419 $12,519,225 $15,649,031

28 2046 2047 $3,372,452 $6,744,903 $10,117,355 $13,489,807 $16,862,258

29 2047 2048 $3,626,839 $7,253,678 $10,880,517 $14,507,356 $18,134,195

30 2048 2049 $3,893,455 $7,786,909 $11,680,364 $15,573,818 $19,467,273

Total $41,978,447 $83,956,893 $125,935,340 $167,913,786 $209,892,233

NPV@ 5% $14,809,867 $29,619,734 $44,429,601 $59,239,468 $74,049,335 Source: TXP, Inc.

1310 South 151 Street, Suite 105 1 Austin , Texas 78704 1 (512) 328-8300 phone 1 (512) 462-1240 fax 1 www.txp.com

Conclusion The Loop 20 improvement projects are a critical component of the City of Laredo's overall

transportation system. The project would provide improved access to thousands of acres of

undeveloped land between US 59 and US 83. In addition, the Loop 20 project would support a catalytic

Bridge #5 that could transform this portion of Webb County.

Over the next 30 years, a City of Laredo Loop 20 TRZ could generate between $26.7 million and $48.9

million in nominal incremental tax revenue assuming a 10.0 percent allocation to the TRZ. Using a 5.0

percent discount rate, the hypothetical TRZ could generate between $9.6 million and $17.3 million.

If the City of Laredo decides to move forward with a TRZ, the following are the next steps:

• Refine the TRZ boundary to exclude existing developed properties in the north and

northwestern portion of the study area

• Consider extending the TRZ boundary east along State Highway 359 to take advantage of

pending projects that would access and utilize Loop 20 improvements

• Collaborate with landowners on annexation within the study area to capture the increment

from new development prior to construction beginning

• Recalculate the TRZ increment value based on the above and move forward with

implementation

These projections are based on the best available datasets and information related to market conditions

in Webb County. Given the high visibility of this project, for example, the substantial commitment of a

few large developers could have a significantly positive impact on both the level and timing of future

growth. Moreover, the financial projections make no allowance for positive spillover to the value of

other properties in area as a result of new development (beyond inflation}, which easily could occur. At

the same time, a slowdown in development as a result of a weaker national economy, negative changes

in key drivers of regional economy such as oil and gas exploration, or other unforeseen issues could

materially reduce the volume of construction put in place over the next 30 years.

1310 South P 1 Street, Suite 105 1 Austin, Texas 78704 1 (51 2) 328-8300 phone 1 (51 2) 462-1240 fax I www.txp.com

Appendix - Intersection Improvements


About TXP, Inc.

TXP is an economic analysis and public policy consulting firm founded in 1987 in Austin, Texas. Our

clients have discovered that we are the firm to hire when there is not an immediate, obvious, or simple

solution to their economic or public policy challenge. In addition to drawing on the expertise of our firm

members, we regularly partner with urban planning, engineering, and public policy firms to put together

teams uniquely suited to our clients' needs.

TXP offers a full-range of economic analysis and forecasting services to public and private clients. The

firm specializes in applying focused primary research to enhance secondary data. TXP offers a number of

other services to clients, including periodic reports highlighting economic trends in regional economies

and presentations to a range of stakeholders. TXP currently serves as economist-on-retainer for a

number of high-profile private and public sector clients throughout Texas.

As economic development policy becomes increasingly standardized, differentiating one community

from the next becomes more difficult. TXP takes a more customized approach. Unlike traditional

community and economic development plans that rely heavily on historical demographic data and

current industry concentrations or clusters, TXP believes that integrating targeted business recruitment

with land use planning and cultural vitality offers the best opportunities for long-term growth.

TXP has successfully helped clients manage the balance between economic development, land use

planning, and infrastructure development to ensure overall community prosperity. Our team provides

in-depth analysis on the connection between tax base enhancement and service cost reduction, and

works with communities, state agencies, local governments, universities, and developers to facilitate

growth and redevelopment.

TXP, Inc.

1310 South 1st Street, Suite 105

Austin, Texas 78704

(512) 328-8300 phone

www.txp.com


Legal Disclaimer

TXP reserves the right to make changes, corrections and/or improvements at any time and

without notice. In addition, TXP disclaims any and all liability for damages incurred directly or

indirectly as a result of errors, omissions, or discrepancies. TXP disclaims any liability due to

errors, omissions or discrepancies made by third parties whose material TXP relied on in good

faith to produce the report.

Any statements involving matters of opinion or estimates, whether or not so expressly stated,

are set forth as such and not as representations of fact, and no representation is made that

such opinions or estimates will be realized. The information and expressions of opinion

contained herein are subject to change without notice, and shall not, under any circumstances,

create any implications that there has been no change or updates.

1310 South 1st Street, Suite 105 1 Austin, Texas 78704 1 (512) 328-8300 phone 1 (512) 462-1240 fax I www.txp.com

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