TIF Law Changes – 2018

Jack Dunn

Tax Increment Financing (TIF) is one of those dry, dusty legal terms that invite the reader’s eyes to glaze over and the pages (or their electronic device?) to drop from their hands.

However, it has become a powerful tool for the City’s economic and social welfare development. How TIF is used determines whether a city is welcoming, equitable, and inclusive or hostile, top-heavy, and exclusive.

Recently, the Nebraska State Legislature’s >Urban Affairs Committee rewrote the section of law called the Community Redevelopment Act to deal with issues raised by the Nebraska Auditor of Public Accounts (PDF – 2.35Mb) and members of the public.

This was the priority bill of the Urban Affairs Committee. It was passed by the legislature and signed by the Governor.

Trevor Fitzgerald, Legal Counsel to the Urban Affairs Committee, prepared a summary of the final bill for the legislature. I have linked to a reproduction of it along with comments on the changes. Mr. Fitzgerald’s summary refers back to the final version of the bill as amended. I have linked to that version also – AM1823 – so that the assiduous reader might view both the original language and the new language.

In the past, TIF laws without penalties have had little effect. Perhaps the best example is the unchanged Nebraska Revised Statutes 18-2114 which says in part: “The recommendation of a redevelopment plan by an authority to the governing body shall be accompanied by … a statement of a feasible method proposed for the relocation of families to be displaced from the redevelopment project area.” It is unusual to find a feasible method of relocation statement in TIF project plans. We will find out if the updated laws are followed any better.

The Urban Affairs Committee and the Legislature did an excellent job of updating the Community Redevelopment Act within the constraints of the current politics and economy. They have gone thus far and no further and, to be fair, perhaps could go no further.

But the job of think tanks like PRI is to go beyond what is possible and prepare the way for a new political climate. With this in mind, I refer you to a previously published blog post that goes beyond the constraints of current politics and economy. To paraphrase the Kennedy brothers and George Bernard Shaw: “Some see things as they are and say Why? But we dream things that never were and say Why Not?”

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