Official site of Tribune News serving Tomball, Magnolia and Waller

The Tomball City Council and the Tomball Economic Development Corporation (TEDC) recently began discussions on financing for a new business park in Tomball.

The park, which will be located at the corner of Hufsmith-Kohrville and Holderrieth roads, was moved into the design stage late last year.

"When I came on board the TEDC in March of 2011, we started doing analysis on the economic development side to see where we were and what we found was that costs associated with developing in many areas were challenging because of the lack of infrastructure," TEDC executive director Kelly Violette said.

Violette said that Tomball has lost a lot of potential business because of a lack of build-ready site locations.

"We are losing a lot of potential clients because we have a minimal amount of sites that are ready to develop," she said.

The TEDC recently approved $1.7 million in funding for the sites planning and design stages and recently met with council members to discuss financing options for the construction of the park. Violette said that they estimate the total cost for the site to be around $14 million, including the money already spent for design.

"We have had a number of discussions to talk about what is available as far as financing goes," she said. "We want to make sure that the amount we borrow and the cost to borrow are affordable."

Violette said that preliminary discussions are leaning toward the city issuing bonds, that TEDC will be responsible for paying back. The bonds will be of the type that will not require property taxes to go up.

"The next step is that the city's financial advisor and bond counsel will come and give council and TEDC a checklist of what's needed to make sure the responsibility of paying is on the TEDC," she said, adding that the process will take about four months.

The planned 102-acre park has already received interest from numerous companies, according to Violette. Current designs outline potential lots and Violette said that companies can purchase any size lot they desire, as long as it is a minimum of 5,000 square feet.

Current interest in the park has come mainly from oil and gas companies.

"The indications are that it will sell out quickly," she said. "What is exicitng is that we can be somewhat selective and find companies that fit with Tomball. We are looking for companies with good track records."

The Tomball City Council and the Tomball Economic Development Corporation (TEDC) took the first steps toward an agreement to fund a new business and industrial park on Holderrieth and Hufsmith-Kohrville roads, as they agreed to issue Certificate of Obligation bonds, which will be TEDC's responsibility to pay back.

"One of the things that city administration and (TEDC executive director) Kelly Violette asked me, was to find a way to fiancé this project to support the business park in a way that was as efficient and cost effective as possible," said the city's bond counsel Jonathan Frels. "One of the mechanisms we have seen work very well in other cities is the process whereby the city issue certificates of obligation, but the actual payments come from the EDC."

Frels went on to say that Tomball and the TEDC have done business this way in the past, with the TEDC paying off bonds from 1999 and 2002.

"It works in situations like this where the type of infrastructure (water, sewer, streets, etc.) that you are planning to put in is city owned," he added.

The proposal that both the TEDC and the city council agreed to, is one in which the city will issue around $8.5 million in bonds and the TEDC will make the payments. The money will go towards developing the property into a business, technology and industrial park, which officials hope will attract numerous new businesses and jobs to the area.

The agreement also calls for the TEDC to hold a specific fund balance of $2 million, in order to assure the city and creditors of their ability to pay back the money.

"It matches what a rating agency would require of the city and we can go to them and tell them 'look, here is what we have'," Frels said.

The council then approved a measure to publicize the intention to issue the bonds. The entire process is expected to be completed sometime in April.