Tax Increment Financing
The council will discuss resolutions Wednesday night that would create two new Tax Increment Financing districts within the city, an economic development tool designed to spur growth in areas that otherwise would continue to stagnate.
I could probably spend 1000 words attempting to define tax increment financing, but Nick Penzenstadler of the Post Crescent nailed it in a recent edition of City Notes:
When a TIF district is created, the amount of property taxes collected by local schools and governments is frozen at the “base” year's value. Any new tax revenue generated from the rising values — or increment — goes toward paying off the investments — and is diverted from the other taxing entities.The proposed districts would be the ninth and tenth for the city. #9 covers an area near E. Wisconsin Avenue around Appvion, and #10 includes the vacant CVS Pharmacy and former K-Mart site along W College Avenue.
One of the most challenging decisions to make regarding TIF districts is called the "but-for" clause. TIF districts are only supposed to be created in situations where development would not happen but for this expenditure. It's hard to pull out our crystal balls and figure out what may happen here if we don't step in.
I recognize the challenge of doing economic development well while also being responsible financially. As things stand right now I intend to listen intently to arguments against doing this but I'm leaning towards voting yes for both districts.
The report from last week's Finance Committee meeting has two items that I think are interesting.
First, we'll need a two-thirds vote from council to make a budget adjustment to allocate $25,000 for a consultant to work on the Fox Cities Exhibition Center project. You may recall that this is the same matter we discussed at Council two weeks ago, when Alderman Jischele's resolution on this matter passed by a 9-6 vote. It had previously been rejected on a 6-6 vote with several alderpersons absent.
In theory this is a paper transaction: The council has made their will known on this matter, and now it's simply a matter of approving the budget adjustment. It's unlikely to be that easy, though, as alderpersons who disagreed with the resolution in the first place get another chance to attempt to prevent it from going through.
Second, it's likely to be less controversial but the council will be asked to approve an agreement for short term cash loans involving the city and the Appleton Area School District to cover potential incidental temporary shortfalls in their budget. This is a pretty good win-win arrangement: The city lends money to the school district as needed, usually for short periods of time, and receives a better rate of return than is usually available to them.
Keeping you informed on issues that may impact you around the city is one of my primary goals as an alderman. Making the council's activity as accessible as possible to as many people as are interested is part of my goal to make it easier for more people to get involved with issues that matter to them.