The origninal intent of TIF was to revitalize blighted areas in a community.
An increasing number of cities are using TIF to incentivize development in desireable areas to compete with neighboring cities.
Address the scope of how TIF can be used.
Taxpayers are Being Held Hostage
When property tax dollars are spent to compete with other communities instead of revitalizing blighted areas, the taxpayer loses.
Tax increment financing (TIF) is an economic development tool used by local governments. TIF is primarily used in the form of property tax abatements or reductions to spur investment. It can be a great mechanism for addressing blight and encouraging development in an area in a community that may otherwise be unfavorable.
Unfortunately, an increasing number of communities are using TIF to incentivize development in desirable areas in order to compete with neighboring communities for new businesses. When property tax dollars are being used in this manner, the taxpayer loses, as local governments are subsidizing growth that would have likely occurred organically at the taxpayers’ expense.
The scope of TIF desperately needs to be addressed. Using TIF for the original intent of addressing blighted areas is reasonable, but the increasing use of TIF for broader economic development is extremely concerning. Cities, and in turn, the taxpayers, are being held hostage with their own tax dollars to pay for development that would occur naturally if cities no longer had to financially compete against each other with tax incentives.