Potter County commissioners reviewed a proposed revenue sharing agreement with the City of Amarillo that could reshape how sales tax revenue is distributed within areas affected by past annexations.
The discussion centered on land originally included in the Potter County Assistance District, which voters approved in 2017. The district established a 2% sales tax in unincorporated areas of the county, with proceeds designated to support public services such as emergency response and other county operations. Since its creation, approximately 14,000 acres of that district have been annexed into the City of Amarillo.
City officials noted that despite annexation, state law allows the county to continue receiving sales tax revenue generated in those areas. Under provisions of the Texas Local Government Code, the city and county could enter into an agreement to share that revenue equally, splitting proceeds 50/50.
City of Amarillo officials presented the concept as a draft framework intended to support long-term collaboration as development continues in annexed regions. They also emphasized the need to define terms for how the agreement would function over time, including what would happen if either party chose to end the arrangement or if it reached an expiration date. Concerns were raised that future termination could leave service obligations in place without corresponding revenue support.
County officials raised several operational and administrative concerns during the discussion. One issue involved the structure of the assistance district itself, which does not employ dedicated staff. Instead, county employees are responsible for oversight, adding to their workload. Officials also noted limitations in accessing the detailed financial data required to fully evaluate the proposal, indicating that additional software and systems may be necessary before a complete financial assessment could be made.
Because of these gaps, county representatives said they were not yet able to provide a full fiscal recommendation on the proposal or determine the exact portion of revenue potentially affected. City representatives responded that much of the land in question remains undeveloped and is not currently generating significant sales tax revenue for the county.
They added that future commercial development in those areas is likely dependent on municipal infrastructure and services such as utilities, suggesting that large-scale revenue generators would more likely occur under city development rather than county jurisdiction.
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