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<br />Public Financing Tools Proposed <br />for Twin Lakes <br /> <br />Tax Increment Financing <br /> <br />Local governmental planning and financing tool since 1973 <br />Designed by the Legislature to replace federal urban renewal <br />programs <br />Basic premise is the "but for" test <br />. Without municipal assistance, a project would not occur or would not <br />occur within the foreseeable future <br />Utilizes the increase in property taxes resultina from new <br />development to finance qualified public improvement costs related to <br />that development <br />Requires creation of a Project Area and adoption of a Development <br />Program <br />Requires creation of a TIF District and adoption of a TIF Plan <br /> <br />Tax Increment Calculation & <br />Definitions <br /> <br />Exhibit 1. TIF Assessed Value (AV) Over Project <br /> <br />[ <br /> <br /> <br />~ <br /> <br />~ <br /> <br />Tax Increment Calculation & <br />Definitions <br /> <br /> <br />Public Financing Tools Proposed <br /> <br />for Twin Lakes <br />. Tax Increment Revenue Bonds <br />. Bonds repaid with new property taxes generated from a project <br />that has been constructed (I.e. tax increment) <br />. Are not backed by the City's taxing power <br /> <br />. Tax Increment Revenue Note <br />Common alternative to issuance of bonds <br />. Also referred to as "pay as you go" <br />. Developer pays for eligible costs as they are incurred <br />. City issues a revenue note to reimburse the developer with tax <br />increment when and if available <br />. City bea rs no risk <br />. Developer bears risk that insufficient tax increment will be <br />regenerated for payment <br /> <br />3 <br />