Agenda Packets - 1997/03/24 - Laserfiche WebLink

Home Browse Search

r 11 ON r $ I lii...iift----\"7 ONLY MC 145 University Avenue West, St. Paul, MN 55103-2044 ague of Minnesota Cities Phone: (612) 281-1200 • (800) 925-1122 ifies promoting excellence Fax: (612) 281-1299 • TDD (612) 281-1290 Tax Increment Financing Briefing Paper Issue synopsis/League position: The use of tax increment financing (TIF) is once again being criticized by lawmakers and others at the state level. Various circumstances have combined to bring the TIF issue to the forefront in the 1997 legislative session. These include: (1) the increasingly-touted TIF impact on the state's general fund due to education finance formulas and a denial of the but-for test's validity, (2)the Legislative Auditor's March 1996 Report criticizing the use of pre-1990 increments for"general public improvements," and (3) the Office of the State Auditor's concerns discovered in their first year of oversight responsibilities, largely in the form of differences of opinion with practitioners as to how various areas of the law should be interpreted. The League supports increased flexibility in the use of tax increment financing and opposes changes that would hamper cities ability to use the tax increment tool. Messages for legislators: Give your legislators detailed examples as to how tax increment • financing has been critical in your community's development and redevelopment efforts. Specify positive results such as property tax base development,job creation, and other benefits. Stress that TIF is often the only tool available to cities and that local-decision-makers are in the best position to decide which projects are best for their communities. Pending bills/status: H.F. 815/S.F. 842, introduced by Rep. Ann Rest (DFL-New Hope) and Senator Leonard Price (DFL-Woodbury) and referred to the House and Senate Local Government committees, would eliminate Option A in the calculation of fiscal disparities contributions. The contributions would be required to be taken from within TIF districts. . H.F. 914/S.F. 838, introduced by Rep. Jim Rostberg (R-Isanti) and Senator Bill Belanger (R- Bloomington) and referred to the House and Senate Local Government committees, would authorize local units of government to abate up to half of a certain portion of property taxes attributable to the value added by new construction or rehabilitation, reconstruction, and additions to existing structures on commercial property. Effective for property taxes payable in 1998 and thereafter. H.F. 926/S.F. 847, introduced by Rep. Steve Sviggum (R-Kenyon) and Senator Dick Day (R- Owatonna) and referred to the House and Senate Local Government committees, would expand the authority to elect the local contribution alternative to the LGA/HACA penalty for new and • -over- AN EQUAL OPPORTUNITY/AFFIRMATIVE ACTION EMPLOYER