TIF Reform - Missouri [proposed]

SB 172 would limit the use of TIF to areas characterized by moderate income (less than 80 percent of the surrounding area's median income), high unemployment (one-and-a-half times the rate of the surrounding area), or low fiscal capacity (assessed value per capita is at least 40 percent lower than the surrounding area).

It would require that municipalities conduct economic feasibility studies to determine that the development would not occur without the subsidy. It would prohibit the use of TIF on sites that are more than 25 percent undeveloped land or farmland, and limit the use of TIF for projects that are primarily retail unless the development occurs in a federal enterprise or empowerment zone, or a "distressed community" as defined elsewhere in state law.

The bill would also reduce the impact of TIF on schools, libraries, and fire departments by stipulating that 25 percent of the tax revenue used to pay off the bonds be diverted to these other taxing districts. Currently, these districts have no say over the creation of TIF districts, but lose revenue every time a municipality establishes one. Some cities have threatened the provision of essential public services by converting much of their tax base to TIF districts.

More Information:

• Proposed Missouri TIF Reform