Wednesday, November 08, 2006
City Ready to Hit TIF Ceiling
For all the shortcomings with the state’s definition of blight, the Supreme Court’s decision to mandate prevailing wage to be paid on projects funded with a TIF, and the ability to use a TIF in areas where it is not needed and for projects of dubious benefit, there is a limit to the insanity contained in the TIF statute. It is section 5ivC, and it states that “the aggregate value of equalized taxable property of the [proposed] district, plus all existing tax increment districts, does not exceed 10 percent of the total value of equalized taxable property within the municipality”.
With the development of a new retail/office/hotel complex in East Liberty on the drawing board and petitioning for a blight designation and a TIF package, the time for decision has fallen onto City Council’s lap. "If this one would put us at 10 percent," said the city Planning Director, "we need to decide whether this is the one we want to" [put us at the limit].
Perhaps the City would like to have some of those earlier TIF deals back. Lazarus? ALCOA? Home Depot? The new PNC Tower?
That the City has hit the limit already (the first TIF plan came in 1994) indicates they should have erred on the side of caution and been a little more judicious with their TIF packages. What’s worse, the City has failed to grow its real estate tax base in recent years and tax collections are stagnant. Without a reassessment on the horizon, that is unlikely to change.
With the development of a new retail/office/hotel complex in East Liberty on the drawing board and petitioning for a blight designation and a TIF package, the time for decision has fallen onto City Council’s lap. "If this one would put us at 10 percent," said the city Planning Director, "we need to decide whether this is the one we want to" [put us at the limit].
Perhaps the City would like to have some of those earlier TIF deals back. Lazarus? ALCOA? Home Depot? The new PNC Tower?
That the City has hit the limit already (the first TIF plan came in 1994) indicates they should have erred on the side of caution and been a little more judicious with their TIF packages. What’s worse, the City has failed to grow its real estate tax base in recent years and tax collections are stagnant. Without a reassessment on the horizon, that is unlikely to change.
