Friday, February 5, 2021

Windham establishes new TIF districts, amends another one

By Ed Pierce

If Windham is to sustain orderly growth and development now and into the future, the importance of continuous investment and infrastructure improvements remains at the forefront for those leading the town.

With that in mind, the Windham Town Council approved two new Tax Increment Financing Districts and amended an existing TIF at its Jan. 26 meeting. Councilors conducted public hearings about the issue and agreed to establish new 30-year TIF districts for North Windham and South Windham and voted to amend the current NW Roosevelt Trail TIF.

Members of the Windham Town Council amended the current
Tax Increment Financing District for the shown NW Roosevelt
Trail area and also created new 30-year TIF districts for North
Windham and South Windham during a meeting on Jan. 26.
The TIFs will encourage orderly development and help pay
for infrastructure improvements in those areas of the town.
“With the public hearings the town has approved these TIFs and have now sent the materials to be approved by the Department of Economic and Community Development at the state level,” said Windham Town Manager Barry Tibbetts. “These TIFs are for infrastructure improvements, roads, sidewalks, lights, sewer, transportation needs, and traffic improvements.

Tibbetts said that these TIFs do not allow for any credit enhancements to be paid out or shared with any businesses or developers.

According to Tibbetts, Tax Increment Financing Districts are great tools for the community and allow for very effective use of those incremental valuation tax funds.

“The TIF in the simplest definition is they support businesses, provide for essential improvements for the community through strategic planning,” Tibbetts said.

Here in Maine, Tax Increment Financing is a flexible finance tool used by towns and municipalities to leverage new property taxes generated by a specific project or projects within a defined geographic district. Any portion of the new taxes generated may be used to finance public or private projects for up to a defined time period of 30 years.

The town gets to outline the TIF district size and boundaries, determines the amount of new taxes to be captured, identifies allowable public and private projects and exercises oversight for the TIF district.

TIFs may provide funding for a business seeking an investment or it could reserve a portion of newly generated revenue for specific public use that benefit as community ranging from upgrading a road or adding on to an existing structure or facility without affecting a decrease in state revenue as a community prospers.

As the tax foundation of a community expands as the town develops, conversely it eases the tax burden on residents and businesses. TIFS foster and encourage new development by allowing a community to retain new tax money without losing state revenue.

Tibbetts said by state law, Windham is limited to the total area allowed within TIF districts but is only using 1.5 percent of an allotted 5 percent overall.

“The TIF allows the community to capture 100 percent of the dollars to be used for improvements such as sidewalks, roads, lighting, traffic improvements, etc.,” he said. “This occurs since the identified valuation is separated from our total town valuation. The result allows certain funds from the state to increase and other responsibilities to decrease since these are based on the total town valuation.”

He said that because of the TIF approval, the town will pay less county tax creating savings for the town budget, RSU 14 will receive a greater share of the State Aid to Education funding lessening the burden to the local property taxpayers, and it increases the revenue sharing dollars Windham now receives from the state.

“Since TIFs allow the incremental taxes to be dedicated to specific projects, we are able to apply long term funding to specifically address anticipated issues in the future,” Tibbetts said. “For example, we know traffic through the northwest area of Windham in the summer is a problem, we know heading south on Route 302 and taking a left at Route 115 is challenging, and we know having a sewer system within certain areas preserves water quality and allows for business growth and jobs, there are many needs to address. These items and many others will need funding to correct.”

Using TIFs allows the town to plan for these changes, use the funds set aside to match Federal and State Grant programs and pay for improvements, and lowers the burden for taxpayers in the municipal budget, Tibbetts said.

“Short term we are able to use funds to bring in the necessary consultants to assist in solving and identifying items,” he said. “These TIFs put in place the ‘vehicle’ for the town to get to an end solution.” <

No comments:

Post a Comment

Your Comments Help Improve Your Community.