The City Plan Commission and the Community and Economic Development Committee each met 05/24/2023. During their respective meetings, they each discussed a proposal to create Tax Increment Financing District #13 in Southpoint Commerce Park. As part of that discussion, city staff gave a presentation on how TIF districts work in general.
Information specifically regarding proposed TIF District 13 would be available in June and was expected to come before the City Plan Commission and the Common Council as an action item in July.
I’ve prepared transcripts of both the City Plan Commission discussion and the Community and Economic Development Committee for download.
Economic Development Specialist Matt Rehbein gave the same presentation to both committees.
TIF District 13 would encompass the entire Southpoint Commerce Park, and the primary purpose of it would be to complete infrastructure between Coop Road and Eisenhower Drive. The commerce park is running out of larger parcels, and the city wants to put in that infrastructure so that they can start marketing that area to industrial manufacturing users. The city wants to do this because they believe that it is not economically feasible for a private developer to acquire the land, put in the infrastructure, and sell it at a price that would make sense for a manufacturer to locate there.
Some time was spent going over how the financing in TIF districts worked, prompted in part by the impression some people may have had that the city was going to cut a $4.4 million check for the Fox Commons development downtown in TIF district 11.
In TIFs, the base value of the area is calculated, and throughout the life of the TIF, the various taxing entities, continue to receive tax dollars based on that initial based value just like they received prior to the TIF being created. Outside of a TIF, when development happens a property’s value increases and that causes the amount of taxes the city and other taxing entities receive to increase. When development happens within a TIF, the taxing entities continue to only receive taxes on the initial base value of the property while any increase in taxes that results from the development of the land goes back to the property in order to fund the development. When the TIF eventually closes, the tax dollars that resulted from the increased property value stop being put toward funding development of the property and now start going to the city and other taxing entities and can be used for whatever those entities desire.
Mr. Rehbein noted that TIFs are “a tool that that municipalities have, really the only tool that municipalities have, to help spur development.” He also noted that state statute only allows TIFs to be created in situations where “but for” the TIF the development would not occur.
In the specific case of the Southpoint Commerce Park, it was hard to promote industrial land and manufacturing development on a case-by-case basis, which is why creating a TIF in that area would be allowed and supported by the state.
City Plan Commissioner Andrew Dane asked what percentage of Appleton’s equalized value was currently in TIF districts. Mr. Rehbein responded that it was a touch over 4%. The state limited that amount to 12%, so Appleton was well under the limit.
View full City Plan Commission meeting details and video here: https://cityofappleton.legistar.com/MeetingDetail.aspx?ID=1101171&GUID=F52BD4E3-90DE-4B65-9E86-B2573B21B666
View full Community and Economic Development Committee meeting details and video here: https://cityofappleton.legistar.com/MeetingDetail.aspx?ID=1101172&GUID=376E2B8E-B1D9-4E5C-9458-CC10FE363497
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