Show All Answers

1. What is a Tax Increment Financing (TIF) District?

Tax Increment Financing (TIF) districts help municipal governments stimulate redevelopment in a designated area. Using this tool, the City can reimburse property owners for certain expenses using the property tax revenue that new development within the district generates. It is important to note that a TIF district is not an additional tax and does not impact zoning.

2. How does the Tax Increment Finance (TIF) program work?

When a TIF district is established, the current net taxable value (NTV) on each property within the TIF district is set at a “base” value. Funds are generated by the increase in net taxable value of properties located within the district as those parcels are redeveloped. The difference between the “base NTV” and the new NTV, what is referred to as the “increment”, is rebated back to the municipality. This increment, or rebated real estate taxes, can be used to reimburse developers for approved costs, and/or to cover the municipality’s cost of improving the district.

The rebates are reimbursement for eligible project costs and are tied directly to the property tax increment created on the site of their new development. The City and the property owner negotiate the reimbursement rate based on the new improvements they create. This contract continues until the point at which the property owner has been paid the agreed-upon reimbursement, or when the TIF expires, whichever comes first. TIF 2’s expiration date is December 31, 2035.

3. What are some of the approved costs for a private homeowner or developer?

Specific expenses eligible for reimbursement include:

• Architectural, engineering, legal, environmental, financial, planning, and other services;
• Property assembly costs, including the acquisition of land, demolition of buildings, and site preparation;
• Costs of rehabilitation, reconstruction or repair or remodeling of existing buildings, fixtures, and leasehold improvements;
• A portion of the construction interest cost incurred by a developer is related to the renovation or rehabilitation of a redevelopment project.

4. Can the municipality also use the money generated in a TIF District?

Yes, the municipality can also use the money in the special TIF fund to make public investments such as:

• Infrastructure improvements such as streets, sidewalks, water/sewer lines, broadband, street lighting, and water and sewer lines.
• Funds can also be used to make property purchases within the District, as well as marketing expenses related to the District.

5. What are the benefits of a TIF to the neighborhood?

The benefits of a residential TIF program can include:

• Remove & prevent blighted homes
• Increase the tax base
• Stabilize development
• Aid in the development of affordable housing
• Assist in converting renter-occupied to owner-occupied homes
• Add infrastructure enhancements
• Conduct marketing activities

6. Why did the City of Carbondale develop a residential TIF?

City Council’s expectations are that a residential TIF would help to:

• Help redevelop homes
• Help renovate blighted homes
• Create an incentive to encourage homeownership
• Restore neighborhoods

7. If my home or neighborhood becomes part of a TIF District, does this mean that businesses will be able to relocate there?

No. A TIF District is a financial incentive district and does not impact zoning. The only way that a business could locate within a neighborhood is if it conformed to the zoning codes already in place there.

8. How can I find out if my property is within a TIF district?

Please refer to the map at this link: www.explorecarbondale.com/815/TIF-District, or contact the Economic Development Office at 618-457-3232 to find out if you qualify.

9. What are the TIF Architectural Design Standards and how do they affect my project?

All projects are required to adhere to the Residential Tax Increment Financing District Architectural Design Standards by complying with at least two (2) design elements for the appropriate category of the work to be done.  

For example, if a roof is to be replaced, it must meet the pitch requirements of 5:12 or greater and the materials or color be different than the immediate surrounding homes. If the siding is to be replaced, it must be one of the approved materials of brick, natural or faux stone, cement, wood, or vinyl and also vary in color or materials from immediately surrounding homes.