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.