The city of Fort Worth wants to attract companies that could bring more jobs to the area, but first it needs to become more competitive with the amount of funds it dedicates to economic development.
Fort Worth has the least amount of funds dedicated to attracting businesses compared to other cities in the area such as Arlington, Irving and Dallas, according to a report issued to City Council on Feb. 15.
Now, the council will consider a plan to create additional funds for economic development in order to be more competitive.
The plan under consideration calls for the city to dedicate money from expiring Tax Increment Financing Districts, a portion of money dedicated to a certain area to improve infrastructure of an area, for economic development under the proposal.
Robert Sturns, the economic development director for the city of Fort Worth, said one of the priorities is to create “deal closing money” to financially lure businesses to the city.
“We’re actually behind the 8-ball, I’ll just be frank with you,” Sturns said to the council in a meeting on Jan. 4.
Under the plan, the city will increase the level of its economic development incentive fund by tapping into funds upon termination of several TIF districts.
This potential annual allocation of funding could raise the annual incentive fund balance to somewhere between $15 million to $18 million over the next five years, according to a presentation to the City Council on Feb. 15.
These are new revenues flowing to the city and there would be no financial impact to existing operations, according to the staff report.
“You’ve got to think about who we’re competing with, not only in DFW, but also nationally,” said Michael Crain, who represents District 3 on the council. “What’s Denver doing? What’s Nashville doing? What’s Atlanta doing? We’re looking at this on a lot broader scale. How can we make ourselves more competitive across the country, across the globe, to bring more jobs and investment into the community.”
Last year, 21 headquarters moved to Dallas-Fort Worth, but none landed in Fort Worth proper, according to information from the Dallas Regional Chamber.
“We’re fully supportive of what they’re doing, and it’s great for the city to be thinking outside the box on developing new programs that can support existing and new businesses coming into town, so we applaud their efforts,” said Chris Strayer, executive vice president of Economic Development at Fort Worth Chamber of Commerce.
The city has seen growing interest from businesses considering coming to Fort Worth, Strayer said. In 2019, the city processed 85 requests for information or for proposals from companies or their representatives, he said. That grew to 121 in 2020 and to over 150 last year.
“We’re getting more looks from around the world,” he said. “We’ve really raised the profile of Fort Worth to be more competitive with a lot of the communities across the country, but also more competitive inside of those industry clusters that we target.”
In 2017, the city hired consulting firm TIP Strategies to come up with an economic development plan. The pandemic and the accompanying economic shifts prompted some changes to that plan, Jon Roberts, managing partner for the agency, said. However, the intention is the same: Make Fort Worth competitive in attracting businesses.
“The biggest risk we faced in many ways in Fort Worth was that Fort Worth would be seen as nothing more than a suburb of Dallas,” Roberts said in a City Council meeting in January.
Fort Worth and other large cities have a disadvantage when it comes to economic development. Cities over 500,000 people can’t take advantage of a sales tax that goes to economic development, the document said. Because of this, larger cities have to get creative with how to raise money dedicated to development.
Fort Worth has earmarked $2 million this year for “deal closing” money, which is used to provide relocation assistance and other costs for companies looking to move to the city.
It also has an additional $5.9 million from selling a piece of land. Still, it’s pocket change compared to the other cities that have dedicated deal closing money.
In Texas, Dallas has $2.4 million allocated this year along with a $40 million bond package and $7 million in American Rescue Plan funds it will spend over the next three years. In Arlington, the city has $17 million raised from a sales tax referendum passed in November 2020 to fund its Arlington Economic Development Corp. In Collin County, Frisco has an economic development war chest of $27 million, according to the staff report.
In other states, the competition is even more fierce. Atlanta has $60 million in dedicated funds and free land. That leaves Fort Worth competing with cities and states that have more dedicated resources.
Lately, companies have been finding other areas appealing.
Last year, Fort Worth was on the short list to land an attractive, cutting edge company, electric truck maker Rivian. The company was considering a site on the west side of town in the Walsh development and Fort Worth and the state came up with an incentive plan valued at about $500 million. The plant ended up in Georgia following a full-court press from that state.
The Fort Worth Chamber’s Strayer notes that attracting new businesses and supporting existing businesses goes beyond just incentives.
“We’re looking at work force, we’re looking at real estate, we’re looking at infrastructure,” he said. “There’s so many things that go into the decision-making criteria for a company, and we want to make sure that we’re competitive and strong on each one of those. This is one of those things that the city and City Council felt passionate on, and I applaud what they’re doing. We’re excited they’re thinking outside the box on it.”
Not all council members voiced full support for the plan to increase the economic development funds when it was first discussed in early January.
Cary Moon, District 4 council member, mentioned that he feels comfortable with the city’s current offerings to attract businesses.
“When those companies make that decision to go elsewhere, other than Fort Worth, sometimes I feel like they are losing more than we are,” Moon said in a Jan. 4 council meeting. “Because we have put forth a good opportunity before them and Fort Worth creates great opportunities for businesses, particularly ones in the industries that we’ve been focusing on.”
Other council members like District 7’s Leonard Firestone said there needs to be urgency to get money in the budget. Mayor Mattie Parker agreed.
“The reason why we keep getting our butts kicked, is because that’s the competitive edge that they have over a city like Fort Worth,” Parker said. “They’re going to come to Texas. The question just becomes what place in Texas are they coming? And that’s oftentimes where we lose out.”
Seth Bodine is a business and economic development reporter for the Fort Worth Report. Contact him at firstname.lastname@example.org and follow on Twitter at @sbodine120.
Bob Francis is business editor for the Fort Worth Report. Contact him at email@example.com. At the Fort Worth Report, news decisions are made independently of our board members and financial supporters. Read more about our editorial independence policy here.