When Victor Toledo and his partner, Chad Lacerte, were looking for a location for their new wake board park, they approached nearly a dozen cities looking for the right spot.

But once they met with members of the Allen Economic Development Corp. and spoke with representatives of the city of Allen, Texas, they knew they had found the perfect location, says Toledo.

“We talked to several north Texas cities at the same time, and they were all very receptive to the concept,” says Toledo. “But what Allen did differently is that they really stepped up and said, ‘Not only do we like it and want it, we’ve even got a place for it, and we can help you through the approval process.’”

The pair presented the concept rendering for Hydrous Wake Park to the city in January 2011, began construction in April and opened in September. Although there are 230 cable parks around the work, Hydrous is one of only 13 in the U.S., and the only one in America with three cable systems. And after just four months of operation, it was named 2011 Cable Park of the Year by Unleashed magazine, an international wake boarding publication based in France.

“Looking at the success of these parks around world, we thought bringing the concept to a healthy, vibrant market like Allen, especially because it’s in the Sunbelt, would be a good match, as the city is very youth oriented and very sports oriented,” says Toledo. “We really drew on the European parks in our design and strategy to create a ski resort type atmosphere in the middle of the city.”

Smart Business spoke with Toledo about the new business, and how the Allen Economic Development Corp. has been key to its early success.

What part did the Allen Economic Development Corp. and its members play in your decision to locate in Allen?

They have been very accommodating. They have really been a true partner throughout the whole process. Hydrous is located in a city park, nestled between a skate board park and the high school, which has 5,200 students, just opened a $30 million performing arts center and is completing a $60 million high school football stadium. Allen is a city that really cares about culture, sports, recreation and education, and it has done a tremendous job.

We approached several cities at the same time, and Allen was one of them. They saw an opportunity, they saw the presentation, and they immediately set up a meeting for us with the Parks Department and the city manager’s office, and they really helped us expedite the process.

Once things were set in motion, how did the city and the economic development corporation continue to assist you?

We have an ongoing relationship with the city because they are our landlord; we rent space from them. The Allen Economic Development Corp. was our liaison with the city, and they helped us secure a long-term lease on the property at a nominal cost. The fact that we didn’t have to invest any capital up front for the land made Allen a very attractive option for us, allowing us to focus our investment on the building, digging the lakes, digging the well and building a pro shop. We didn’t have to invest anything for the land, and without that incentive, we probably wouldn’t be here.

The city and the economic development corporation are also our marketing partners. One thing that’s attractive about this venue is that it’s a regional draw, and we get a number of visitors from foreign countries. We estimate that less than 10 percent of the people who wakeboard here actually live in Allen.

How has the city assisted you with water concerns?

There was a drought last summer, so as we were digging the two lakes, the city also allowed us to dig a 1,200-foot well so that we would have our own dedicated water source that was not subject to drought restrictions. That’s a big up-front cost, but we now don’t have a water bill.

The city didn’t want us to compete with its existing water resources and was able to accommodate us. And quite frankly, we couldn’t have competed with the existing water resources because of the drought restrictions.

How did your fall opening help you get up and running?

We really would have much rather opened in March at the start of the busy season, but the way it worked out, we signed the lease in January, got engineering approval in March, broke ground and finished by September, which was a pretty ambitious timetable.

So rather than wait until March to open, we decided we wouldn’t open the restaurant until then but we would at least get our feet wet and get some experience under our belts. That way, in March, we are ready to really show our best because we already have five months’ experience running the park.

We had time to make sure we had made good personnel decisions and marketing decisions, rather than just opening in a whirlwind with a brand new staff. And we’re feeling pretty good about our decisions right now.

Would you recommend that other businesses consider locating in Allen?

Absolutely. The economic development council and the city have been tremendous partners. They have a very pro-business attitude and they care about their city. They are very aggressive about attracting the right type of businesses and diversifying their tax base. And in our case, they also provided an amenity that Allen’s residents previously didn’t have — a lake. There was no boating culture here at all, and now Allen has become the wake boarding go-to spot in the country with wakeboarding videos regularly shown around the world.

Victor Toledo is co-owner of Hydrous Wake Park in Allen, Texas. Reach him at (214) 755-9905 or victor@hydrouswakeparks.com. Reach the Allen Economic Development Corp. at (972) 727-0250 or www.allentx.com.

Insights Economic Development is brought to you by the Allen Economic Development Corporation, strategically positioned in the Dallas/Fort Worth metro.

Published in Los Angeles

With the Texas budget deficit currently projected to exceed $27 billion, local taxing jurisdictions will be relying on the most stable of taxes to help make up this budget shortfall: property taxes.

Property taxes are administered at the local level, as Texas does not have a state property tax. Given that there is an estimated $150 to $250 million deficit in the Dallas Independent School District alone, property owners can expect their property values and tax rates to remain stable, and in some cases increase, despite declining values in the current market.

“The school districts count on property tax revenues to make up more than 50 percent of their funding,” says Jeff Mills, senior manager at Crowe Horwath LLP. “This adds pressure to all parties involved with the appraisal process to ensure that the overall taxable value is in line with their budgeted needs.”

Less than 10 percent of property owners appeal their tax assessments, effectively leaving money on the table when assessments are not in line with the current economic climate. Professional consultants can help taxpayers monitor their taxable values, become educated in the appraisal process, obtain available exemptions and ensure critical dates are met in the appeals process.

Smart Business spoke to Mills about what taxpayers in Texas should know about keeping their property taxes in line.

How is the property tax system structured?

Property taxes are administered at the local level via the county appraisal districts. Boards of directors are appointed by taxing units made up of school, city, county and special district representatives. The board of directors appoints the chief appraiser who oversees the appraisal of all of the properties in the district. The board of directors also appoints the Appraisal Review Board, made up of ‘independent’ citizens that are in charge of hearing appeals when an agreement cannot be reached between the taxpayer and the appraisal district informally. It is of note that the Appraisal Review Board is paid by the appraisal district and appraisers conduct multiple hearings throughout the year often with the same review board members.

How can taxpayers appeal their property tax values?

Frequently, taxpayers don’t understand the process of how to appeal their values. By the time tax bills are received, the deadline to appeal has already passed.

Properties are assessed as of January 1 of each year based on the ‘fair market value’ of the property: typically the price at which a property would transfer for cash or its equivalent under prevailing market conditions. Assessments notices are sent out in early May, but have been known to be mailed out much later. This is a crucial component of the appeal process, as a taxpayer only has 30 days to appeal from the date of the receipt of the assessment notice, or May 31, whichever is later. Not receiving an assessment notice or not knowing the critical dates may cause taxpayers to forfeit normal appeal rights. Other means of appeals can be very time-consuming and costly.

Once a timely appeal is filed, the taxpayer is required to receive 15 days’ advance notice before the hearing is scheduled to occur. Failure to receive notice is not necessarily grounds for rescheduling a new hearing.

How can people make sure they’re not paying more than their fair share of property taxes?

Whether you collect market data on your own or hire a property tax consultant, be prepared with an opinion of market value for your property and thorough support when challenged. Even if your assessed value stays the same or decreases slightly, the overall tax liability could still be higher. Tax rates are not set until October, several months after the protest deadline. It’s rare that the taxing units will vote to decrease their respective rates, especially during the kind of budget constraints they’re facing now.

Also, for owners of business and personal property, be aware that filing your fixed asset schedule in its entirety may cause an over-inflated assessment of market value. Conducting a fixed asset review may uncover several assets that are being assessed at a higher value due to lack of description on your asset ledger. In many cases, assets can be shifted to a faster depreciable life. A review can also help to identify ‘ghost assets,’ which are assets no longer located at the facility that have failed to be removed from the ledger.

What else should people know about saving on their property taxes?

Homeowners and business owners should understand or ask their advisers about the various exemptions available to them:

  • Homestead exemption
  • Freeport exemption (inventory shipped out of Texas)
  • In-transit inventory (inventory passing through the state and protected under the Commerce Clause)
  • Pollution control equipment
  • Agricultural exemption
  • Abatements — Property tax abatements do not include the school district portion of the property tax, which is the largest portion. Opportunities may exist to recoup a sizeable portion of this tax.

When in doubt, hire a licensed tax consultant; many will not charge a fee unless they are successful in reducing the assessed property value. These professionals have access to market data for various types of properties, and have experience with identifying savings opportunities and managing the appeals process. The No. 1 reason that taxpayers don’t achieve a reduction in a hearing is lack of preparation and support. I’ve seen numerous cases where taxpayers are trying to make an argument without knowledge of how their property is assessed.

While current market conditions may warrant a reduction in your appraised value, don’t expect a lower tax liability without knowing your rights, and appealing your values.

Jeff Mills, CMI, is a senior manager in the National Property Tax Practice at Crowe Horwath LLP and a licensed senior property tax consultant in Texas. Reach him at (214) 574-1037 or Jeff.Mills@crowehorwath.com.

Published in Dallas