Tax Increment Financing

Tax Increment Financing Overview

Tax Increment Financing (TIF) provides a partial reimbursement of taxes paid on improved property over a defined time period, typically 9 years but sometimes longer for certain projects. A property owner must apply for TIF financing certifying that their property improvements would not be possible without this type of financial support. A specific tax parcel or parcels must be identified as the TIF District.

Three types of TIF Districts are available: Economic Development TIF districts for new manufacturing / industrial developments, Redevelopment TIF Districts to help with the updating or removal of blighted properties, and Housing TIF Districts which focus on affordable housing projects.

  • Economic Development TIF District – A 9-year district that can provide funds for land acquisition, infrastructure (such as street, water and sewer, and parking), grading and excavating, and site improvements. This type of TIF district is primarily used for industrial projects.
  • Redevelopment TIF District - A district that can go up to 26 years and provides funds for the removal of blight conditions on a lot (for example, sub-standard buildings or site clean-up). Additional requirements apply.

Requirements
  • A TIF application must be received and finally approved by City Council (public hearing required) before a building permit may be issued and any eligible work is completed
  • Prior to Council approval, the Lake City EDA must approve the TIF application and recommend it to the City Council
  • The project must meet one or more of the adopted TIF goals of the City EDA, as outlined in the City of Lake City and Lake City EDA TIF Policy
  • The project must comply with all Lake City Comprehensive Plan and Zoning Ordinances
  • As long as necessary requirements are met, any type of project (industrial, redevelopment, housing) is potentially eligible
  • A deposit of $7,500 is required for administrative costs related to review and implementation of a TIF district
  • All tax increment financing proposals should create an agreed upon number of new jobs on the site. Housing and retail/commercial Projects are reviewed on an individual project basis.

Rates/Terms

Tax increment financing in Lake City can be provided in two different forms, pay as you go and up front payment. In either case, a maximum amount of financing will be established in the agreement.

Pay as you go - Annual payments are based on tax increment -- increased taxes due to improvements on the property generated from the project. These are reimbursed and issued to the applicant after the applicant pays their payment of property taxes. by the applicant.

Up front payment - The City issues revenue or general obligation bonds. The increment generated from the applicant's project is then used for repayment of bonds.

Download the Lake City Tax Increment Finance Policy and Application.

Contact

Contact the Lake City EDA at 651-345-6808, or e-mail info@lakecityeda.com for an application or additional information.