November 21, 2009
What's Inside:
Downtown TIF proposal discussed
A lengthy discussion on an idea for Downtown revitalization leaves little room for fence-straddlers.
You’re either for tax increment financing or against it, and you have plenty of vocal volume to back your point.
City staff, council members and about 30 citizens discussed the proposed Downtown TIF plan during a Town Hall meeting Thursday at the Fraternal Order of Police Lodge.
City Manager Vince Capell made the case that Downtown growth needs a TIF to create an incentive for independent investors.
“I’ve often said Downtown is doing exactly what it needs to do,” Mr. Capell said. “In about 150 to 200 years, we’ll be right where we want to be.”
The TIF plan would accelerate the process, Mr. Capell said.
The city manager attempted to clear a common misconception on the TIF. When the City Council votes on the issue Monday, it will not approve a single project. Instead, the vote will determine whether a TIF district will be established Downtown. If the council approves, property owners would submit individual projects to the TIF Commission and the council on a case-by-case basis.
For example, if a property owner in the future wants to turn an empty building into a bar and the council determines the area has enough drinking establishments, it could deny the project. The owner would then either come up with another idea and submit it for TIF approval, or complete the project without TIF assistance.
The loudest arguments focused not on whether a TIF should be used, but on how it works.
“This is not free money,” said Virginia Weigum, a resident known for keeping an eye on City Hall. “Our grandchildren and their children are going to have to pay for this.”
Before she could finish, a crowd of Downtown business owners shouted variations of the same phrase in unison: “You don’t understand the TIF.”
City Director of Planning and Community Development Clint Thompson and Mr. Capell took turns trying to explain the complicated issue.
They said a TIF is not a tax on St. Joseph’s citizens. The only person who pays money in a TIF is the property owner who submits a project. What a TIF does is divert a portion of the new tax back to the TIF district to pay for improvements.
An empty storefront that generated $1,000 per year in property tax, for example, will still pay the same amount under the TIF. The school district, Buchanan County and other tax jurisdictions don’t lose money. The tradeoff is that they don’t immediately reap all of the rewards.
If improvements are made that turn the empty storefront into a flower shop, the resulting increased property value would generate additional taxes. The original $1,000 per year would still be paid, while the additional increment above the $1,000 base (the ‘I’ in TIF) would be captured to help pay for the property owner’s project.
Meanwhile, governments receive a boost in sales tax revenue, job creation and other economic factors if the TIF spurs growth.
“If you’re here because you’re worried about your money, you should be in favor of the TIF,” said Becky Boerkircher, executive director of the St. Joseph Downtown Partnership.
Clinton Thomas can be reached
at clintonthomas@npgco.com.
This story has 11 comments. Click here to join in on the discussion.
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Finally! Someone explained the TIF in an easy-to-understand way. Good going, Clinton! It's been misunderstood since the last council election.
The biggest challenge this community faces is its own segregation of north, east, south and west. We need to find solutions to work together as a whole and stop worrying about what section of town is supposedly getting more than another part of town. There are plenty of resources out there to assist all parts of the city, they just have to be found and utilized. The downtown TIF is another resource that will benefit the community as a whole. This community should not abandoned its downtown or any other part of the city for that matter. We have some very serious infrastructure, educational, blight, abandoned building, and other concerns that need to be addressed and resolved for the long term, not short term. In the several years I have been here I have seen an increase in downtown traffic, more people from other parts of town are beginning to frequent the night life and other things. We need to do everything possible to continue to improve upon it as well as all our other issues, promote and fund long term solutions, not short term fixes. Nice presentation!!
this is a load of you know what. Read the fine print there is alot more to this all than a darn ceiling in your sales tax. There are benefits for sales revenue and also opportunities for credits and other development favors inside a tif dsitrict. They are explaining the easy part hoping to put the blinders on everyone. Individual projects have the opportunity to gain sales tax incetives and other benefits as well. They are not explaining it all. A rebate on an increase in property tax does not alone entice a developer or individual to take on a project. These "individual" project have to cash flow to work. People don't bet on a losinbg horse and that is what this all is, a bad track with a gimp horse and a jockey who is not telling the entire story. THe straight shot is that some people are going to heavily benefit from this. It is a tool and a state program that works, but why not another area for TIF. TIf the entire town, then midcity doesnt look like FLint Michigan. TIf the north end so we get more shops there. Tif the east for better roads and ease of traffic. TIF the entire town with this magic wand that benefits the elect few who can read the fine print. Lets really explain the TIf and the pahses of the proposed project and the 25 million that is purported for the first phase of it. There are few things worse than trying to politic shamelessly for gain. There are investors who can turn a profit by pushing this and its sick. Why not have the city vote. Poll them. I hope this gets shot down so every other bleeding heart part of the community can come crying to the city saying they need help. Toughen up downtown and use the big muscle upstairs to attract better business and start tearing some of these "priceless" works of aging down and allow for real progress. Better infrastructure with planned development by a professional. St. joseph has a few architects. create a paradigm shift. focus on what you have not what you thought you had. All i see from this is more bars and yeah more bars. Maybe some food and a few more articles on how far the area has come. downtown needs a master plan that has one vision, one voice, that is how you cultivate change. To many voices(individual projects) makes for nothing but static, no music is heard. Go hire and architect, let them asses what is salvageable of our great history and go from there with a plan for new development. This TIF would have been great 30 years ago. It is beyond blight and needs a facelift, not a bunch young girls getting ready for a makeup party.
good article clinton. some people just oppose tax to oppose tax to oppose tax.
simply because some people may have opposed one TIF or another on the basis of who the recipient is or the area is not a reason to oppose this TIF instrument.
oprah, first you advocate against certain individuals getting an advantage because they are the "elect few who can read the fine print" and in the same breath you advocate one vision, and against individual projects.
i guess i prefer someone who can read......... fine print , or the writing on the walls.
heritage
I understand your point and agree with you that i crossed myself up there a bit. Let me speak clearly for a moment without a diatribe that i posted earlier on how st. joseph downtown really is the last of the wild west and its lack of order. My point is that this TIF allows as many downtown individuals to put up whatever they want, which ususally means whatever will make money. That typically is bars and things like bars. Im all for a drink and a few more after that, but I think st. Joseph would benefit greater if they turned the entire area into a district for one developer who with the assistance of an architect can overhual the entire area and create a great mixed use area with retail, bars, resturants and other spots that compliment not compete with one another. I go to beauxdrouxs and the theater when im downtown and steer away from felix st. mminus the one establishment down on the corner by the newspress. That is a great spot. I just think one vision,one voice who listens to the people get the job done. Like P and L had one developer. the entire district had others but the main focus was one developer/firm. I think the small business man cannot do an adequate job of reviving an area like this that is to far gone. I just down like 30 people turning in TIf applications for the same things. I just see more bars and once we stop putting bars in the tif apps will stop. People shop in the north and at the mall. Malls were the death of the great american downtown, we all knew that. Just like walmart shuts the mom and pop store down. I think were just years and years to late on this. Hopefully that is a more reasonable explanation of my feelings.
well i think capell said it all, he think,s in 150 to 200 years from now we will be where we are suppose to be.and i think he is right, it would take this city that long to get their stuff together. enough said, he hit it on the head!
I agree with the one developer/one architect idea. To me, the lack of a master plan is what hurt the Belt. It was just allowed to grow aimlessly. I am concerned regarding the lack of private enterprise, downtown. It seems that the only investment is going to come with government help. I wonder if there is anything the city fathers or the community could do to make things easier for private individuals to be able to have their businesses downtown, without involving them in a TIF. Any ideas????? Let's throw some out here.