The City Council is considering approving and authorizing the first amended and restated interlocal agreement between the City of Houston, Harris County, Reinvestment Zone No. 3, and the Downtown Redevelopment Authority. This agreement facilitates the participation of Harris County in Tax Increment Reinvestment Zone No. 3 (TIRZ No. 3) for the purpose of funding capital projects and their maintenance, as outlined in Chapter 311 of the Texas Tax Code. TIRZ No. 3 was initially approved by the City Council on December 13, 1995, and the Downtown Redevelopment Authority was established on June 30, 1999. An initial Interlocal Agreement with Harris County for participation in TIRZ No. 3 was approved on April 4, 2001, and amended on September 9, 2005. The current amended and restated ILA was approved by the Harris County Commissioner’s Court on July 10, 2025. Under this ILA, Harris County, Precinct 1, will participate at 100% of the funds collected from the Captured Appraised Value of the County’s ad valorem tax rate (excluding debt service and certain other entities). Up to 33% of the participation rate will be allocated for affordable housing, and up to 10% will be retained by Harris County for maintenance and operations of projects. An additional 10% will be retained by the City of Houston. The ILA's term begins upon the City Controller's countersignature and extends to tax year 2042, with the first tax increment payment from the County expected by August 31, 2026.