After a short floor debate, Tax Increment Financing (TIF) passed the House with two new amendments. On a 64-33 vote, HB 1189 now heads to the Senate to await a committee hearing.

While on the House floor, the bill received two amendments with new requirements for cities looking to implement TIF.

The first amendment requires cities to hold at least two public briefings for the community before adopting an ordinance that authorizes a tax increment area. The briefings must include a description of the increment area, the proposed public improvements, and a detailed estimate of tax revenues from the taxing district. Cities would be required to give public notice about the meetings two weeks prior to the meeting date.

The second amendment requires that cities prepare a project analysis while considering the creation of a TIF increment area. The project analysis must then be submitted to the Office of the Treasurer for review. The required analysis would include:

• The duration of the increment area;
• A list of all parcels included in the increment area;
• A description of public improvements including an estimate of costs;
• An estimate of how many jobs would be created due to the public improvements and private development; and
• An assessment of impacts on affordable housing, local business, school districts, and fire service, as well as what steps the city will take to mitigate these impacts.

The Treasurer will have 90 days to complete a review of the analysis and provide feedback to the city. Cities are required to consider the Treasurer’s feedback when crafting the TIF area ordinance.

As HB 1189 is now in the Senate, AWC requests that you contact your local senators to advocate for the passage of Tax Increment Financing. TIF is a powerful tool for local governments to improve public infrastructure, increase economic activity, and promote local job growth.