I’ve been hearing rumors of this, saw an email that went last week, and now we have the official word from the mayor . . .
Here was the first email I saw, it didn’t come to me, apparently, I’m not a “friend” of Aaron Olver. I wonder what else I miss out on by not being a “friend”.
From: Olver, Aaron
To: Olver, Aaron
Sent: Friday, September 14, 2012 12:47 PM
Subject: TIF Policy
I just wanted to give you a heads-up that we are on the verge of launching the conversation the Mayor desires on TIF Policy. If all proceeds according to current thinking, the Mayor will soon announce process to the Common Council. The topic is on the Economic Development Committee’s agenda for next Wednesday, September 19. I am anticipating that EDC will hear a presentation from staff on the 19th and then discuss how they want to proceed in creating a draft resolution regarding TIF policy. While no decisions (outside of process) are being made on the 19th, I thought you might be interested in having a heads-up about the process and may wish to hear the presentation by staff.
Economic Development Division
City of Madison
Here’s the memo from the mayor from yesterday:
To: Madison Common Council
Economic Development Committee
From: Paul R. Soglin, Mayor
Re: Tax Increment Financing (TIF) Policy Review
Date: September 17, 2012
Madison has historically led the state with regard to Tax Increment Financing (TIF), having applied for a grant that led to the development of Wisconsin’s TIF law. Our city has a strong track record of using TIF responsibly to create almost $1.5 billion of tax base. TIF has played a major role in revitalizing Madison’s downtown, improving our housing stock, attracting new residents to the downtown, expanding employment, and investing in public infrastructure. Madison has also been a leader in developing and adopting a municipal TIF policy to supplement state statute. TIF is an important tool and it’s vital we review and revise our TIF policy to adapt to changing economic and competitive factors and to learn from our evolving experience.
I am interested in reviewing and updating Madison’s TIF policy for several reasons:
1. Our current policy was adopted in 2009, prior to the mortgage and real-estate-led recession and in an era when condo projects were common. We should review our policy and update it to reflect changes in real estate markets, differences in our project pipeline, and to reflect the experience we have gained.
2. Given the state’s strict levy limits, maximizing net new construction is critical to future budgets. We need to ensure our policy helps the City compete for a fair share of tax base while preserving our strong track record of fiscal responsibility.
3. Regularly making exceptions to TIF policy creates uncertainty in the development community and places staff in an awkward position in negotiations with developers. We should strive to clarify TIF policy and address new situations in order to minimize the number of exceptions required.
4. TIF is a value-based tool; its usefulness is directly linked to how much property-tax base growth it helps stimulate. We need to establish careful policies to address situations where policy goals other than increasing our property tax base, such as expanding job creation or affordable housing, are at stake .
To this end, I am asking the Economic Development Committee, working with staff, to review our TIF policy and create a draft resolution containing suggested changes to policy. I hope to join Alders in introducing an updated TIF policy recommended by the Economic Development Commission to the Board of Estimates and Common Council for consideration.
Working together, we can craft a strong, responsible, competitive TIF policy to help continue revitalization of Madison’s downtown and neighborhoods, grow Madison employment, increase our tax base, and make vital investments in infrastructure.
I am so happy to see that he wants to get rid of the ridiculous system of exceptions. The current rules are treated as guidelines that can just be ignored as long as you call something an exception. Tho, I have to laugh then when we talk about homelessness, the solution the politicians say is needed is affordable housing. Then, when we talk about tools that can make that happen, they tell us why it can’t be used. His memo sounds like he wants to be using TIF more, so its sounds like we should hold on to our wallets! However, I don’t think that is his intention, so it will be interesting to watch what happens here. Well, for the geeks among us.
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