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Tax Increment Financing (TIF)

According to The Use of Tax Increment Finance by Indiana Local Governments by Larry DeBoer, Department of Agricultural Economics, Purdue University, "Tax Increment Financing (TIF) is a popular but controversial means for counties, cities and towns to pay for infrastructure intended to promote economic development."   

TIF is intended to finance municipal infrastructure that cannot be financed by other means.  This is done by the local government creating a "TIF District" where property taxes resulting from increased assessed value (AV) are used to repay the debt.  In order for TIF funding to work, the AV of property within the TIF District must increase over time.  This means that property taxes must increase for TIF to pay off the debt.

I am against using TIF in a municipality like Westfield.  We do not have an economically-depressed city that has no way to fund economic development other than TIF.  We live in the wealthiest county in Indiana.  We do not need to artificially inflate property values to fund the debt incurred by overpriced monuments to municipal hubris.

 

You can read Mr. DeBoer's complete paper on TIF:

The Use of Tax Increment Finance by Indiana Local Governments

 


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