What is a TIF?
Are you familiar with the term TIF? It stands for Tax Increment Financing. Local governments can use TIF’s to get projects off the ground that would not have an acceptable breakeven without the TIF.
However both the City Council of Knoxville and Knox County Commission have been TIF happy for the past few years. It seems that all projects must have TIF’s, which brings up the question, can local government go to far using TIF’s?
In the April 16th meeting of Knox County Commission a good discussion about TIF’s was held. It is interesting to watch Lumpy Lambert praise TIF’s as an almost magical invention while Frank Leuthold asks the questions I have been asking for several years. Bill Lyons from the City of Knoxville explains how TIF’s work and why they are needed.
You can watch this TIF portion of the Knox County Commission meeting here Part I, Part II, Part III, and Part IV.
The entire Knox County Commission meeting up to the Public Forum is here.
TIF translation: we are borrowing more money to fix your road so we can hike your taxes, because your current taxes don’t cover it like we projected at the last assessment.
When will it end?
I work for the City and I can tell you they ain’t waisting it on our pay or health care. When I see the squandering I oft say I wish they would waste it on me instead.
I don’t know Jed. I have a sick feeling taxes are going to go up a lot and as you say, it won’t go to the workers.
” It seems that all projects must have TIF’s, which brings up the question, can local government go to far using TIF’s?”
No. They cant. If you don’t like TIFs, then you are anti-Capitalism. Its invetment in the community and payback for taxes paid. You can’t deny that. What are you a commie?
“If you don’t like TIFs, then you are anti-Capitalism. Its investment in the community and payback for taxes paid. You can’t deny that.”
Deferring taxes so the government doesn’t receive any revenue for 15 years means that the money to operate the government has to come from somewhere else. If the government TIF’s every project then where does new operating capital come from? It comes from you the taxpayer.
TIF’s are a subsidy. They should only be used when a project absolutely requires them. Overuse of TIF’s means more taxes for taxpayers. Both the taxpayers of the City of Knoxville and the taxpayers of Knox County are looking at significant property tax increases. Yet tens of millions of dollars of TIF’s have been awarded in the past six years. Will our property taxes go down in 15 years? Don’t hold your breath.
Why should one developer get a TIF when another developer doesn’t? How do you know there is not favoritism as to who gets a TIF and who does not?