Why RUDH is filing this lawsuit?
In the lawsuit, RUDH alleges that the 380 Agreement with Ainbinder Heights LLC does not promote economic development, as required by the Texas Local Government Code.
RUDH alleges that the 380 Agreement with Ainbinder Heights LLC constitutes a $6 million tax reimbursement deal for a developer who has stated numerous times that the project would be built with or without this assistance. Mayor Parker and members of Council also stated that the development would have been built with or without public funds. Since that is the case, we allege that this agreement does NOT promote economic development.
RUDH also alleges that the 380 Agreement with Ainbinder Heights LLC violates the Texas Constitution.
The Texas Constitution allows municipalities to use these agreements under established programs, with criteria and standards which promote economic development. In the lawsuit, RUDH alleges that the City completely ignored its own standards and application procedures and simply gave the developer, Ainbinder Heights, LLC over six million dollars for infrastructure improvements needed to support a suburban style Walmart Supercenter development.
Why did you need to take legal action?
We have tried on countless occasions to work through these issues with the City and have found either resistance or non-responsiveness.
We believe that legal action is required because the City is spending money from future city budgets to subsidize developers who do not need these funds and thus, not promoting economic development. Tax revenues are scarce and should not be used to pad wealthy developers’ profit margins.
In addition, the way the City’s 380 program is currently being administered, the City is almost completely ignoring the standards and application process that they should be following in order to ensure fiscal responsibility and good public policy.
Isn’t this really just an effort by your group to keep WalMart out of your neighborhood?
No. This lawsuit is about the City’s alleged misuse of taxpayer funds to support developer profit making; if there is going to be an economic development program at the City of Houston, it should be administered by following the established standards and criteria, be transparent to the taxpayers and support economic growth in areas of the City that are underserved and where projects would otherwise not be built.
What is RUDH hoping to get out of this lawsuit?
If the Court agrees with our allegations, we are asking that this 380 Agreement be invalidated; if the City then wishes to persist in making this tax reimbursement, it must be done in a manner which conforms to City and State legal requirements and must be publicly presented to Council for a re-vote in the future.