This book brings together leading experts to examine the evolving nature of tax increment financing (TIF), the most widely used tool of local economic and community development. Originally designed as an innovative approach to the redevelopment of blighted areas, it has become a more general-purpose tool of economic and community development. Contributors offer case studies of the uses, structures, and impacts of TIF projects alongside more general discussions on the theoretical, financial, and legal bases for the use of TIF. They also explore its effect on overlapping jurisdictions such as cities, counties, and school districts. Some of the case studies capture TIF at its best--redeveloping areas that would likely never develop without substantial incentives. Other cases highlight questionable uses, especially where it has been used in new ways that those who developed the tool never envisioned.
Originally published in 2001, the book was called "...a major contribution to the debate on the efficacy of such economic development financing tools as TIF..." by the journal
Public Budgeting & Finance. Clear, comprehensive, and timely, this new edition features the latest research and thinking on TIF, including the political, legal, and even ethical issues surrounding its use.
Author(s): Craig L. Johnson, Kenneth A. Kriz
Edition: 2
Publisher: State University of New York Press
Year: 2019
Language: English
Pages: 366
City: Albany
Contents
Figures and Tables
Acknowledgments
Part I: Background
Chapter 1 Introduction
Introduction
References
Chapter 2 A Primer on Tax Increment Financing
Introduction
The Basic TIF Financing Structure
TIF Development Planning and Management4
Initiate Process
Formulate Plan
Legally Adopting the TIF
Implementation and Management
Evaluation and Termination
Notes
References
Chapter 3 A Review of State Tax Increment Financing Laws
Introduction
Characterizing TIF Laws
Process Framework and Analysis
Overall Statistics
Plan Initiation
Plan Formulation
Plan Adoption
Plan Implementation
Evaluation and Termination
Conclusion: The Legal Environment of TIF
Notes
References
Chapter 4 The Use of Debt in Tax Increment Financing
Introduction
Aggregate TIF Debt Finance Characteristics
Annual Issuance Volume
Bond Type
Issue Purpose
Use of Financial Intermediaries
Method of Sale
Bond Structure
TIF Debt Risks
Risks to Taxpayers
Debt Issuance Risk
Risks to Overlapping Taxing Districts
The Moral Obligation
Risks to Bondholders
The Passive Nature of TIF Revenue
Project-Related Risks
Intergovernmental Fiscal Relations
Conclusion
Notes
References
Part II: Implementation, Uses, and Structure
Chapter 5 The Port Covington TIF: Did Baltimore “Protect This House”?
Introduction
Baltimore City’s Economic Development History and Budget Strategies
Analyses of the Project’s Financial Details and Approval by the Executive
City Council Review and the Community Benefit Agreement
How the TIF Could Affect the City’s Education Grant from the State
Evaluation
Notes
Chapter 6 TIF for Major Project Development: The Case of the Stapleton Airport Redevelopment
Introduction
Background
The Stapleton Redevelopment Area and Use of TIF
Stapleton’s Brief Historical Timeline
Complex Financing and Functional Relationships
Use of Tax Increment Financing
TIF Authority and Timeline
TIF Arrangements and Creative Finance
Shares between Construction and Ongoing Services
Use of Best Source of Financing
Lessons from Stapleton’s TIF
Notes
References
Chapter 7 An Incentive Program Grows Up: The Evolution of TIF in Chicago
Introduction
TIF in Chicago
Changing Political and Fiscal Circumstances in Chicago
The Daley Boom Years
Transition to Emanuel
Changes in Chicago’s TIF Program
Illustrative Cases
Citywide Transit TIF Districts
Participatory Budgeting in West Humboldt Park
Lessons Learned and Conclusions
Notes
References
Chapter 8 TIF in California: Birth, Growth, Death, and Resurrection
Introduction
History
Fiscal Stress in California
Natural Disasters
Exogenous Influences
Voter Initiatives
State and Local Tax Structures
Examples of Fiscal Stress
Natural Disaster: The Loma-Prieta Earthquake
Voter Initiative Examples
Interjurisdictional Relationship
State Reforms
The State Budget Crises, the Fall of RDAs, and the Rise of EIFDs
Conclusions
Notes
References
Chapter 9 The (D)Evolution of TIF Use: Redevelopment to Land Development in Nebraska
Introduction
Legal Vagueness and TIF Expansion
Case Study: “Project No. 1: Costco Poultry Complex” in Fremont, Nebraska
Methodology
Case Study
TIF Process
Fremont’s Use of TIF for the Project No. 1: Focus on Plan Formulation
Finding of Blight and the Designation of TIF District
“But For” Test
Cost-Benefit Analysis
Other Issues
Discussion and Conclusion
References
Chapter 10 Using TIF for Brownfields Redevelopment
Why TIF for Brownfields?
Brownfield Site Characteristics and TIF
General Characteristics—Cleanup Costs and Years Vacant
Distressed Areas
Re-use
The Role of TIF in Comparison to Other Incentives
Transformational Brownfields-TIF Projects
Baltimore—Harbor Point
Milwaukee—Menomonee Valley
Innovations and State Program Modifications Designed to Make the TIF-Brownfields Connection
Pay-As-You-Go
Eligible Expenditures
Plan and District Creation Requirements
Pooling—Cross-Fertilization of TIF Districts
Adjusting the TIF Base for Cleanup Costs
Redevelopment Authorities Using TIF for Brownfields Projects
Liability Protections
Site Entry
Model 1: Michigan’s Brownfields Redevelopment Authorities
Model 2: St. Paul Port Authority
Model 3: Brownfields Land Banks
TIF Futures: Curb It, Expand It, or Focus It?
Notes
Chapter 11 State Super TIF Programs: New Tools for Transformative Urban Redevelopment
Background
Summaries of State Super TIF Programs
Kentucky—Signature Projects
Bowling Green
Missouri—Supplemental Tax Increment Financing Program
Missouri’s State Supplemental Tax Increment Financing Program
Missouri Downtown Economic Stimulus Act (MODESA)
Kansas City—Cerner Corporation/Three Trails Project
Pennsylvania—City Revitalization and Improvement Zones (CRIZ)
Allentown City Center
Massachusetts—Infrastructure Investment Incentive Program (I-Cube)
Boston Landing
New Jersey—Economic Redevelopment and Growth Grant
Controversial and Failed Projects
Trenton/Wire Rope District
Mississippi—Brownfields Tax Incentive
Michigan—Transformational Brownfields Plans
Kansas—STAR TIF
Nevada—Tourism Improvement Districts and STAR TIFs
Issues and Best Practices
State Super TIF and the Balance of State-Local TIF Commitments
Summing It Up
Notes
Part III: Economic, Social, and Fiscal Impact
Chapter 12 The Theory and Economic Impact of Tax Increment Financing
Introduction
Literature Review
Elements of a Theoretical Model for TIF Adoption
TIF Impact
The Effect of TIF on Property Values
The Effect of TIF on Economic Outcomes
Conclusion
References
Chapter 13 Tax Increment Financing and Spatial Spillovers
Introduction
Literature Review
Methodology
Data
Outcome Variable
Treatment Variable
Control Variables
Results
Conclusion
References
Chapter 14 The Conceptual Pliability of TIF and the Political Rhetoric of Environmental Remediation: Groundwater Pollution and Tax “Decrement” Financing in Wichita
Introduction
Wichita’s Groundwater Pollution Crisis
Crafting a Local Solution
The Creation of a New TIF Statute
Implementing the Gilbert-Mosley “Decrement” Plan
Litigation, Settlements, and the Rising Reliance on Tax Revenue in Gilbert-Mosley
Operating Gilbert-Mosley: Original Aspirations, Current Budgets, and Anticipated Revenues
Conclusion
Notes
References
Chapter 15 TIF and Education Funding: Issues and Impact
Introduction
Literature Review
Conceptual Framework
TIF without Increments
TIF with Increments
TIF with Returned Excess Increments
TIF with Spillover Effects
TIF with Effects on State Aid
Other Issues with Potential Implications for Education Funding
Determination of Increments
TIF Areas Spanning Multiple School Districts
Other Protections
Discussion
Notes
References
Chapter 16 TIF Legislation in Indiana: Agile and Adaptive
Introduction
The Evolution and Use of TIF in Indiana
The Evolution of TIF Legislation in Indiana
Concluding Remarks
Notes
Chapter 17 Conclusion
References
Contributors
Author Index
Subject Index
