5.6. PCSR 06-08-2010 - Laserfiche WebLink

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IMPLEMENTATION • FINANCING A detailed financial analysis was not performed as part of the planning process. There area many financial variables involved with complex development planning projects. The following information highlights the key tools currently available to finance implementation of the master plan. Tax Increment Financing The costs of development and redevelopment may be too great to allow new projects to be financially feasible. The situation poses the classic "but for" situation in State law governing tax increment financing. "But for" the use of TI F, the development as proposed would not occur. It is clear that the desired redevelopment will not take place without the removal of physical and economic barriers by the City. Tax increment financing is the only tool with the capacity to accomplish these objectives. As with other elements of the master plan, projections for the use of TIF are both comprehensive and conservative. The plan seeks to provide a clear understanding of what might be required with the goal of reducing public financial commitments as the plan is implemented. The result can be found in other large redevelopment settings. As redevelopment begins to transform an area, market forces improve. As the potential income from rents and sales grow, private development can carry more costs of redevelopment. This master plan assumes that all of the redevelopment projects will be included in TI F districts. In simplest terms, TI F allows the City to capture the property taxes from redevelopment and use these monies to pay for the investments required to undertake the development. Financial analysis conducted through the planning process clearly shows that private development will not alone support the investments required for implementing the master plan. The costs of desired development and redevelopment are likely too great to consider all new projects to be financially feasible. This plan does not offer a primer on the use of TIF since the City is familiar with the intricacies of TIF from its use on other redevelopment projects. Instead, implementation of the plan requires attention to the key issues that influence the use of TIF: Project Area: TIF relies on two types of areas. The "project area" is a broader area with common development goals. The "tax increment financing district" is the specific parcels from which tax increment is collected. The project area is important because it defines where tax increments can be used (see discussion of "Pooling" that follows). The project area defined for this master plan should also be designated as the project area forthe purpose of establishing TIF districts. •r.-A• `~ ; 171St. GV2r1U@ Focused Area STudy ]t