Tuesday, November 20, 2007

Enterprise Zone

I errored in my last post suggesting that the land targeted for the big box store had to be blighted to use tax increment financing. It qualifies for TIF because its in an enterprise zone, a status designated several years ago to provide incentives for businesses to locate there.

TIF apparently started many years ago to helped redevelop blighted areas, but lawmakers expanded its use to other areas designated for certain development, like enterprise zones. I'm still looking into what criteria must exist to start an enterprise zone. I wasn't aware until recently that GOFF Industrial Park had this designation.

Thanks Patrick for setting me straight on this.

3 comments:

charles said...

What we can do with TIFF and what we should do with TIFF are not interchangeable concepts.

TIFF was initiated with a specific need in mind. How TIFF is used requires a strong discipline with respect to municipal planning.

One may have, for example, a generous savings account. Its purpose might originally be in preparation for retirement or perhpas the vacation of a lifetime.

Lets say, a neat second hand car comes available. You have the savings and can afford to draw out to get a classic or vintage mobil.

The savings was for a specific purpose. Later another "steal" comes along. You pinch off a bit more. Why not? You do, after all have the savings and it is there for what you choose.
Even if you opt to do something different, it's there for you.

Problem is that money, whether personal or for public service, is finite. These programs will only sponsor so much growth. Tax forgiveness in a community must ultimately help in the community and the state or.... someone will have to increase taxes to make the difference.

TIFF and my all time favorite Neighborhood Revitalization are intended to aide municipalities in addressing blighted areas. These incentive programs are intended to stimulate the economy by eliminating (or avoiding) ghetto residential and industrial neighborhoods within a community.

The programs in their more liberal application of modern times promote a phenomenon known as urban flight. When neighborhoods deteriorate, people opt to move to newer nicer areas IF they can afford to do so.

What happens to the neighborhoods and neighbors who cannot afford to? Well, those tend to become higher crime areas. The higher crime areas continue to decline and erode the tax base within the community.

The outcome is high vacancy rate within the declining areas and rapidly decaying zones. TIFF was originally intended promote urban growth. TIFF is now being used to promote the lessor desirable urban sprawl. We are proposing to follow the sprawl approach - to create new enterprise zones and eschewing the challenge of refurbishing the aging market areas.

TIFF used in the expanded definition is being used in many communities to accelerate the abandonment of older, traditional, retail centers including small town downtown retail zones.

Sure folks will enjoy a new retail center. Who, then, will attend the neglected and vacant existing retail centers? If a new home improvement center drives an existing downtown area local home improvement or hardware business out, what will leadership use to address the vacant structures?

They could use TIFF to recruit new retailers but why not do that to preserve and promote growth of those centers now and avoid creating ghetto areas within the community?

Anonymous said...

yeah why not use the money to help out the existing? cause that wouldnt put any money into the citys pockets, or the commisioners pockets. dont worry about the ghetto areas, the city will take care of them by tearing them down or running a bypass through them. and dont ya just love that the city owns a vacant lot in their very own 'ghetto' downtown that is suddenly worth 13,000 dollars when somebody wants to do something with it? yeah, sure it is, a vacant lot in an already blighted downtown with empty buildings, i wonder who they conspired with, um i mean hired, to do that appraisel for them

Anonymous said...

I am not buying that this is even remotely about city commissioners getting paid or paid off. Those five folks are decent and ethical people. The fact is that they are doing prety much what they pledged when they were elected.

The folks who are representing citizen interests at city are ALL first termers. The myth of graft and corruption does not even remotely apply. They are still learning the functions and finer points of serving as a city commissioner.

The pertinent matter is that these folks promised they would listen to and consider proposals such as the big box retailer. In making that promise, they won your vote. Now they are simply honoring what they promised you in exchange for a term in leadership.

There was only one candidate who explicitly stated a commitment to making downtown the center piece of community growth and progress. He was not elected.

Therefore, I think we owe it to these five elected officials to respect their integrity and to convey support for their courage to pick SOME direction and begin marching.

Experience assures me that, if it is the right direction and a long term benefit to the community, no one will remember their visionary decision. If it is a bad move and hurts the city no one will ever forget their near-sightedness and erred judgment.