Archive for Thursday, April 12, 2007

Residental TIF use needs clarification

April 12, 2007

The city of Eudora is moving forward with the creation of a tax increment financing district that will apparently include a residential component.

That should raise concern because TIFs, in effect, dedicate property taxes owed on improvements to property to paying for the streets and utility infrastructure that supports them. It is our understanding, the TIF available to the residential piece of the development will be limited to installing the main sewer line to serve the TIF district.

As a rule, we would argue TIFs should not be made available to residential development unless it was a unique development meant to meet a shortage of an underserved housing niche or in blighted areas needing an incentive to spur redevelopment.

That would be especially true in Eudora with its many new subdivisions. A causal drive around the city offers plenty of evidence developers have had great success in marketing those homes while passing on the costs of installing streets, sewers and waterlines. Clearly, there is no need for added incentives to promote residential green-field development in the city. A concern would be that a subdivision without that burden, even if it was only sewers, would have a competitive edge.

But we're prepared to listen to the rationale to extend incentives for sewers for residential development in this TIF district. We share and understand the need for more commercial development in Eudora. But we would hope there would be other compelling arguments, such extending the sewer farther in the direction of future growth.

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