There is always an inherent danger in believing that the future will emulate the past. "Of course property values will increase, and at a rate that mirrors what we've seen." It pays to at least model what could happen if that's not true to understand some of the risk involved.
Yeah, I think they do tend to use somewhat conservative assumptions when they model some of these TID proposals, but I agree that more explicit sensitivity analysis or something might be useful.
Good article Ben. I appreciate you citing Chicago. I come from that land where almost the entire city is covered in TIFs. It is sad developers across the US expect TIF assistance if a community wants any infrastructure upgrades, affordable housing, etc.
Tosa is one of the few municipalities left in the state with a AAA bond rating which means city staff are doing something right. That said, we don't want to make the mistakes of other cities and blanket everything in TIDs.
Some additional follow-up, in the budget documents that are coming up, the performance of each TID is included. Tosa is currently has 5% of it's total value in a TIF which is less than the 12% limit by the state.
Thank you. Yeah, I don't know too much about Chicago, so that was surprising. And good to hear some of that information will be included in the next budget. I'll take a look when it becomes available.
Money, like water, will follow the path of least resistance, and TIF’s certainly do reduce friction in the marketplace. It seems to have become a bastardized process from the original intent, due in part because of actions by the legislature 10-20 years ago, and municipalities years before that. Would they be needed to the extent they are if municipalities didn’t have such tight budget caps? Probably not. It seems to me that if there was more trust between municipalities and the legislature to budget and tax responsibly, then there would be a more honest allocation of resources (private and public) via TIFs. In short, we need more people acting in good faith.
There is always an inherent danger in believing that the future will emulate the past. "Of course property values will increase, and at a rate that mirrors what we've seen." It pays to at least model what could happen if that's not true to understand some of the risk involved.
Yeah, I think they do tend to use somewhat conservative assumptions when they model some of these TID proposals, but I agree that more explicit sensitivity analysis or something might be useful.
Good article Ben. I appreciate you citing Chicago. I come from that land where almost the entire city is covered in TIFs. It is sad developers across the US expect TIF assistance if a community wants any infrastructure upgrades, affordable housing, etc.
Tosa is one of the few municipalities left in the state with a AAA bond rating which means city staff are doing something right. That said, we don't want to make the mistakes of other cities and blanket everything in TIDs.
Some additional follow-up, in the budget documents that are coming up, the performance of each TID is included. Tosa is currently has 5% of it's total value in a TIF which is less than the 12% limit by the state.
Thank you. Yeah, I don't know too much about Chicago, so that was surprising. And good to hear some of that information will be included in the next budget. I'll take a look when it becomes available.
Money, like water, will follow the path of least resistance, and TIF’s certainly do reduce friction in the marketplace. It seems to have become a bastardized process from the original intent, due in part because of actions by the legislature 10-20 years ago, and municipalities years before that. Would they be needed to the extent they are if municipalities didn’t have such tight budget caps? Probably not. It seems to me that if there was more trust between municipalities and the legislature to budget and tax responsibly, then there would be a more honest allocation of resources (private and public) via TIFs. In short, we need more people acting in good faith.