Tax Increment Financing

Tax Increment Financing (TIF) helps local governments attract private development and new businesses in blighted, decaying and underperforming areas in need of development or redevelopment. TIF makes it possible for local governments to make the improvements they need, like new roads or sewers, and provide incentives to attract new businesses or help existing businesses stay and expand, without tapping into general municipal revenues or raising taxes. TIF calls for local taxing bodies to make a joint investment in the development or redevelopment of an area, with the intent that any short term gains be reinvested and leveraged so that all the taxing bodies will receive larger financial gains in the future. The funds for this investment do not come from current revenues, but from future tax revenues, not otherwise expected to occur. TIF projects may include the redevelopment of substandard, obsolete, or vacant buildings; financing general public infrastructure improvements, including streets, sewer, and water in declining areas; development of residential housing in areas of need; cleaning up polluted areas; improving the viability of downtown business districts; and rehabilitating historic properties.