Former (and maybe future) State Senator Erin Tobin has a post on facebook about municipal TIFs (Tax Increment Financing) that’s making the rounds and has some worthwhile information about why communities use them to finance new development – so the people using the infrastructure pay for it, not taxpayers at large:
This information by Erin is TIF 101 and is I applaud her for helping educate folks on the basics of this incredible tool that has, literally, built our communities. Without TIF, there is no Steel District in Sioux Falls which drive tax revenue to our city, there is no Sanford Sports Complex where kids from all over the state and region stay/play sports and activities, there is no Cherapa or Cherapa II which has created hundreds of housing units and (when the TIF is satisfied) will add hundreds of thousands of NEW property tax dollars in out-years to our community to pay for better schools, roads, cops, etc. rather than the much smaller tax base the property was generating. TIFs can be complicated to understand for some and thus, it’s easy to turn them into the boogeyman. Not all TIFs are homeruns and like anything, they are are a tool in our toolbox to be used with caution; however, when used properly, they are absolute homeruns for a community.
In Rapid City they’re talking about the need for about everything else but a new theme park. I’m wondering, Paul, do any of the TIFs that you’ve passed give complete discretionary spending allowances for 30% of the TIF? Well, it’s mostly discretionary, but specifically states that none of the $35 t0 $40 million of that slush fund money can be spent on infrastructure. Of the $125 Million, $45 million goes to “financing” costs. Complicating matters, we have dozens of campgrounds around the Hills that will really suffer because of this project – many are projecting that they might go out of business. Republicans are famous for harping against a government “picking winners and losers,” but that sure looks like what is exactly going on here. Competition is a good thing. But how does a mom and pop business that’s been paying taxes for decades compete with a $125 million gift? If these campgrounds were in the Sioux Falls area, what would you say to them?
Tobin is showing a level of intellectual heft and policy chops that merits not only having her back in the state senate but in a senior leadership post there to get this legislature back on track.
We can all speculate what Mrs. Tobin’s intentions/goals are, but we really don’t know. However, I think Dusty should give her some serious thoughts as his running mate. She’s bringing intelligent, common sense, factual arguments back to issues that the fringe has spent the last several years filling with misinformation and feelings.
She would make a perfect running mate….bring in West River vote.
The congressman did share this post to his page…
TIFs ARE a government giveaway. They may be worth it for industrial companies that have multiple location options. But too often they are used to subsidize retail operations. If the local economy cannot support a retailer without a subsidy, then it probably should not exist. Wal Mart is an example. If the market will support it let them pay. If it is shaky and wants a subsidy, pass.
So you want local businesses to pay for utilities and infrastructure they will never own? I watched a vacant lot sit for 40 years in my small town here in the Hills. We needed affordable housing. The city could not afford to put in the streets and water/sewer so that the developer could build affordable homes. If we were to rely on the developer to pay for infrastructure that is a municipal responsibility, the homes would have quickly become unaffordable to build/sell. This TIF will be paid off next year and we are already seeing reductions in our school tax portion of the property tax based on the growth of this small development. Without the TIF the housing would never have been there and the 10 acre lot would have still been full of weeds. Your broad statements about TIFs being a government giveaway is simply not always the case.
You are talking about the appropriate use of a TIF. Some of these others, though, are just poorly-disguised giveaways.
Then take that up with the local government that voted it in.
Austin said it right. It’s not about local control it’s about control. These people want power so damn bad it’s not even funny. I wish our current governor would show leadership in this field for once. Then again, that would be a first.
Austin is right, and to piggy back off his idea that they don’t want “local control” just “control “. It’s why they want to eliminate property tax. It’s the only way for a county to generate revenue. Take that away, implement a state income tax or hike the sales tax(both of which the state collects)and voila, they have county governments forced to suck the teet of the state. Jonny or Doby don’t say that part out loud though do they?
No is the first step to Nothing. Sadly, that is what half of the Republican Party wants.
Well, at least 17%.