Lindale Municipal Management District Pros & Cons

Lindale MMD Pros Lindale MMD Cons
Lindale Streets will be fully reconstructed including sidewalks, curbs, and storm drainage. Everyone agrees that Lindale, and most of the City of Corpus Christi, is long overdue for street repair. Lindale 1 comprising Ohio, Indiana, Texas, Ralston and part of Reid are especially needy of reconstruction. The disagreement is about the best, most ethical, least coercive, most fair way to finance the repairs. A Municipal Management District is not the only solution for Lindale streets. There are other, less coercive, solutions to our street problems that do not create an unfair tax burden on Lindale residents such as City Bond Issues and Assessments.

Lindale residents should not be asked to pay for streets which arguably receive most of their wear and tear from non-Lindale drivers. Lindale streets are "through streets". Lindale is not a private gated community nor is it a community with a limited number of entrances and exits. All Lindale streets are open to and used by all Corpus Christi drivers. Lindale streets receive heavy through traffic traveling between Alameda and Staples. In addition, the location of HEB and other neighborhood businesses and schools (Ray High School, Incarnate Word Academy, Menger Elementary) contribute heavily to non-Lindale traffic on Lindale streets. Lindale residents should not be asked to pay for streets which arguably receive most of their wear and tear from non-Lindale drivers. Streets open to and used extensively by the public should be funded by the public.

MMD taxes are fundamentally unfair as a street funding method.

500 Blocks. Residents living on the 500 blocks of Lindale 2 received full street reconstruction including sidewalks, curbs, and storm water drainage without paying any additional taxes or assessment fees. It is not fair to ask Lindale residents to pay for city services that other property owners have received without any additional tax burden.

Del Mar.The entire Del Mar neighborhood received full reconstruction including sidewalks, curbs, storm water drainage, sewer, and water without paying any additional taxes or assessment fees. It is not fair to ask Lindale residents to pay for city services that other property owners have received without any additional tax burden.

Vaky Street. Residents living on the 600 block of Vaky went through the assessment process and are receiving a partial reconstruction of their street including sidewalks and curbs for a one-time charge of under $2000.00 per property. While this solution was unfortunately used by some residents to compel their neighbors to pay against their will, and therefore does create some hard feelings among neighbors, it is a grand bargain compared to the MMD solution which will cost more than $20,000.00 per property.

Lindale MMD Pros Lindale MMD Cons
None.

Our taxes are high enough. During his MMD powerpoint presentation at the May 1, 2013 Lindale Neighborhood Association Meeting, Corpus Christi Assistant City Manager Oscar Martinez noted that the city could not fund street reconstruction by raising sales tax because the Corpus Christi sales tax rate was already at the maximum rate allowed by the State. He said that raising property taxes was not an option for funding because raising property taxes could trigger a "rollback election". He said that a Municipal Management District was a way for residents to "tax themselves" to fund infrastructure reconstruction.

Streets are a City responsibility for which we already pay taxes. Street repair, maintenance, and reconstruction is a responsibility of the City of Corpus Christi for which we pay property taxes, sales taxes, and various utility taxes and fees, and soon we will be paying a $5 - $7 a month street maintenance fee on our utility bill. MMDs are a way for governments to increase taxes without the accountability of normal methods. We do not feel that we are under-taxed.

Your property value will increase as a result of the street reconstruction. Your property taxes (and Lindale MMD taxes) will increase. If the streets are reconstructed your property values will rise. That's a good thing if you are selling and moving out of Lindale. Not so great if you plan to stay in your home. If your property value increases then your property tax will increase as well as the new Lindale MMD tax that you owe to the Lindale MMD.
If a Tax Increment Financing Zone (TIF) is also created in the district there could potentially be additional funds available for other neighborhood improvements. Possible projects mentioned by the Lindale Neighborhood Association include street lighting, a dog park, arts and entertainment events. A TIF is not objectionable if decoupled from the creation of a MMD. Since the creation of a TIF does not itself affect the property tax rates that residents pay, but rather channels a portion of the residents' property taxes back into neighborhood improvements, the creation of a TIF would not be objectionable if decoupled from the creation of a MMD.

However Lindale does not have "common areas". The only areas in Lindale that could be considered "common areas" are: (1) the median at Reid and Indiana, (2) the median at Swantner and Texas, and (3) Lindale Park. In actuality each of these areas are city property, not Lindale neighborhood property, and are open to all residents of Corpus Christi. Areas open to the entire population of the city should be financed by the entire population of the city.

None. Lindale MMD Property Tax burden is grossly underestimated.

Based on already outdated average property valuations. Corpus Christi Assistant City Manager Oscar Martinez provided cost estimates in his powerpoint presentation to Lindale residents. His estimates are based on the 2012 average appraised value for homes in Lindale and predict a yearly tax increase of $1,141.00 for the average home appraised at $103,593.00. According to his estimates, a full street reconstruction will require a 20 year bond. If property appraisals and tax rates were static the average Lindale homeowner would pay an additional $22,820.00 to the Lindale Municipal Management District over the course of 20 years in addition to regular property taxes. Of course property appraisals and tax rates are not static and your home's appraised value may be considerably more than $103,593.00. Consequently, you can expect the actual taxes you will pay to the Lindale MMD over the next 20 years to be considerably higher than the estimate indicates.

Based on pre-reconstruction property valuations. After full reconstruction of streets your property taxes will rise. Some residents living on the 500 blocks of Lindale 2 report their property taxes rose sharply after reconstruction. When estimating how much property taxes, including additional Lindale MMD taxes you will pay, keep in mind that your property valuation and corresponding tax burden will increase over time.

Based on static reconstruction cost estimate. Estimates for the total cost of Lindale street reconstruction will be obsolete by the time an MMD could be formed, bonds issued, and construction funded. The actual cost of full reconstruction is likely to be considerably higher than current rough estimates which will require a higher Lindale MMD tax rate than indicated in Oscar Martinez's estimates.

Lindale MMD Pros Lindale MMD Cons
Some residents could be exempt from the additional MMD property taxes. There has been some talk of the possibility of exempting some classes of property owners from the MMD. Residents over 65, disabled residents, and residents living on the 600 block of Vaky Street have been mentioned as classes who could possibly be exempted from the MMD. These exemptions make sense but do place additional burden on non-exempt residents. Exemption of any group of residents from the MMD will increase the tax burden incurred by all other non-exempt residents. Your estimated Lindale MMD tax burden could be dramatically affected by what classes of residents are granted exemptions. What percentage of Lindale residents are over 65 or disabled? Probably a significant percentage.
None. There are no pros for a quasi-governmental taxing entity administered by an unelected and unaccountable Board of Directors. The MMD Board of Directors is not accountable to Lindale residents. MMDs are not elected governments and are not accountable to the residents of their district. We do not vote to create a MMD. MMDs are administered by a non-elected Board of Directors which is initially appointed by a special act of the Texas State Legislature and subsequent Board members are appointed by a vote of the Corpus Christi City Council. While a MMD can be created by the actions of very few individuals, a MMD can only be dissolved by a petition/vote of 75% of property owners. A MMD cannot be dissolved as long as there are any outstanding bonds and the street project is going to require a 20 year bond.
None. Any real estate marketing benefit from street reconstruction is unlikely to outweigh the disincentive of buying into a neighborhood where property taxes are 30% (or more) higher than other comparable neighborhoods. Neighborhood properties less marketable. The additional property tax burden of MMDs make neighborhood properties less marketable than properties in neighborhoods outside the MMD. If you decide to sell your home, this additional MMD tax burden must be disclosed to the buyer. Consider this, if you are deciding between two houses, one in Lindale with an increased tax burden due to the Lindale MMD and one in Del Mar or Morningside with no additional tax burden do you think that the additional taxes would weigh into your decision?
None. The Lindale MMD will not offer anything positive to neighborhood businesses other than the possible repair of Glazebrook St. Disincentive for neighborhood businesses. The additional tax burden to businesses located in the Lindale MMD creates a disincentive for businesses to locate in our neighborhood. If HEB, Whataburger, or other businesses can move one block down the street and avoid tens of thousands of dollars in taxes, what is their incentive to stay and provide convenient services to our neighborhood? It was also proposed that the Lindale MMD could construct a Tax Increment Financing district (TIF) to collect sales tax from district businesses. This is an additional burden on local businesses and a further disincentive to stay in our neighborhood.
Lindale MMD Pros Lindale MMD Cons
None. Once an MMD is created it may be impossible to dissolve. MMDs are notoriously hard to dissolve once they are created. It takes a petition by 75% of district property owners to dissolve a MMD. And a MMD cannot be dissolved at all if there is outstanding bond debt. Once a Lindale MMD is created there may be no turning back. This argues for careful consideration and research by all Lindale residents. Creating a Lindale MMD that will last for most of our lifetimes is not something to rush into.
None. Everyone in Lindale does not have income security. There is considerable income disparity in the Lindale neighborhood. While for some residents the additional tax burden may not affect quality of life, for some residents the additional tax burden will create real financial hardship that will negatively impact hard-working families in our neighborhood. In addition, a confiscatory MMD tax rate reduces the ability of many neighborhood residents to maintain and improve their property further degrading the appearance of Lindale.
None. "It's the economy, stupid." In the current economy there are many people who have been laid off a job or are unable to find full time employment or employment in their field of expertise. One out of six American households are on food stamps. Many small business owners are struggling because their customers do not have the same expendable income they had only a few years ago. If there ever was a time to consider "taxing ourselves" to provide a service that should have been provided all along by the City, the present state of our economy argues that this is not the right time.
None. Compulsory action is not in the spirit of Lindale. Lindale is a wonderful and rare thing in the world. A place where neighbors watch out for one another and genuinely care about one another. Walking around the neighborhood we meet new friends and visit with old friends. The element of coercion, even if done in a democratic manner, does not contribute to the peaceful coexistence of neighbors which is what most of us love so much about Lindale.
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Actions You Can Take

What would you do to save $30,000.00 or more on your home over the next 20 years?

1) Attend the next LNA Meeting

6PM Monday, August 19, 2013
Lindale Senior Center
3135 Swantner Dr.

Attend the Lindale Neighborhood Association meeting and let them know that a 30% property tax increase is not the right solution for Lindale streets.

2) Talk to your neighbors

Let your neighbors know about this important issue and encourage them to attend the next Lindale Neighborhood Association meeting.

PDF Download Printable Informational Flyer

PDF Download Printable Lindale MMD Fact Sheet

3) Network

If you would like to receive email notification of important events related to the Lindale MMD (including meeting dates) please email us at . We will only contact you to inform you of important Lindale MMD developments and your information will not be shared with third parties.

Lindale in the News

[July 24, 2013] Letter to the Editor: No Municipal Management District for Lindale - Caller Times (paywall)

[July 12, 2013] Texas' special tax districts need more accountability - Caller Times (paywall)