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WASHINGTON JOBS INVESTMENT COALITION SUPPORTING TAX INCREMENT FINANCING AUTHORITY December, 2010.

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Presentation on theme: "WASHINGTON JOBS INVESTMENT COALITION SUPPORTING TAX INCREMENT FINANCING AUTHORITY December, 2010."— Presentation transcript:

1 WASHINGTON JOBS INVESTMENT COALITION SUPPORTING TAX INCREMENT FINANCING AUTHORITY December, 2010

2 The Challenge  Washington economy remains mired in recession  Communities across the state need private-sector investment  Some projects not feasible without public-sector investment – e.g., where aging infrastructure substantially affects project costs  48 states provide mechanisms for local communities to secure future tax revenues to pay for public improvements… But Not Washington … Yet

3 The Solution: Tax Increment Financing  Grant local jurisdictions authority to use tax increment financing tool  Establish a framework for effective public-private investment projects  Create quality jobs  Revitalize communities  Attract new economic opportunities  Put Washington on equal footing with the rest of the country

4 Tax Increment Financing At-a-Glance Source of Funds for Public Investment Incremental real estate taxes resulting from project Eligibility Criteria Area in need of renewal or redevelopment Some limitations on allowable expenses – primarily public infrastructure Process TimelineGenerally 9-12 months, including public hearings

5 Benefits More Tax Dollars Public Improvements Economic Spillover Jobs  Community Benefits:  Increased tax revenues  Positive economic spill-over  Help guide development  Development Benefits:  Reduced project costs  Offsets for extraordinary costs/upgrades

6 TIF Challenges  Additional municipal involvement  Extended project schedule  Possible sales disclosure requirements  Additional design review requirements  Compliance monitoring by local government  Potential impact on funding for special purpose districts (schools, fire, etc.)

7 WA Jobs Investment Act  Legislation structured to respond to unique characteristics of Washington property tax system  Grants authority to cities, counties (unincorporated areas) and port districts (within UGA) to form TIF districts  Local government works with willing property owners within TIF district who agree to voluntarily tax of up to 1% of incremental assessed value  This special tax collection is used to repay bonds issued to fund up-front infrastructure investments to help spur development  TIF district exists only until bonds are paid off (30 year max.)  State property tax for schools and all other special purpose districts, like fire districts, are kept whole

8 Checks and Balances  Project Must Meet Local Qualifications (UGA, land use plans, other requirements)  Economic Analysis Conducted to Ensure Property Values Increases Sufficient to Repay Bonds  Public Notice Given and Hearing(s) Held  Local Government Has Final Approval to Move Forward  Bond Issue Must Be Viewed As Viable by Market

9 Revenue Flow TIF District Taxes Generated State Property Tax Unchanged Special Taxing Districts Unchanged TIF “Special” TaxesTIF District/Municipality Special (Allocation) Fund Pay for Infrastructure (Retire Bonds)

10 Legislative Update  SB 5705 (Kilmer) and HB 1881 (Springer) introduced  Hearings held in Senate Economic Development, Trade and Innovation; Senate Ways and Means; House Ways and Means  As bills move through process, coalition engaged in continued dialogue among members and other stakeholders to develop compromise language

11 Advocacy Moving Forward  Washington Jobs Investment Coalition formed to demonstrate broad public and private support  Website and materials created:  Coordinated lobbying strategy among coalition members  Media engagement strategy to provide editorial support

12 Anticipated Benefits  Provide a tool for local governments to address economic development needs in their communities  Improve Washington’s ability to compete effectively with 48 other states for new economic opportunities  Create family-wage job opportunities  Spur additional private-sector investment across the state

13 How You Can Help  Sign on as official members of the Washington Jobs Investment Coalition (form on website)  Support The Washington Jobs Investment Act, new tax increment financing legislation  Contact legislators as part of coordinated advocacy strategy


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