St. Johnsbury Public Meeting - Town Reappraisal Update and Discussion
May 13th, 2019 at 5:30 pm in the St. Johnsbury Welcome Center!
The St. Johnsbury Select Board is holding a special meeting on May 13th, 2019 at 5:30 pm in the St. Johnsbury Welcome Center to hear updates on St. Johnsbury’s reappraisal project. Town officials will review the town-wide reappraisal process and timeline including the 2019 partial reappraisal of the proposed Tax Increment Financing District.
A tool that funds public infrastructure using incremental property tax revenue to repay municipal debt incurred to build/improve public infrastructure and related costs associated with the redevelopment of an identified area (District).
A “public-private partnership” - public action stimulates private investment.
Specific statutory requirements:
A municipality identifies an area requiring re-development, draws the TIF District around the area, and freezes the base tax of the District.
All taxes on the frozen base value continues to go to the taxing authorities.
Private developers, enticed by the improved infrastructure, build within the District.
The property tax revenues that were flat or declining now increase.
A portion of the tax increment is captured and set aside to help retire the debt that funded the infrastructure improvements, for a specified length of time.
Taxpayers benefit from added value to the grand list once the debt is retired and may receive more wage taxes if the development project creates new jobs.
Substantial real property development is required to improve economic viability of community/region.
A substantial scale of public infrastructure is required to ensure real property development.
Cost of public infrastructure is beyond normal and available municipal financing.
Real property development will generate adequate incremental property tax revenue to service TIF debt.
For more information, please contact:
Megan Sullivan, Executive Director, Vermont Economic Progress Council
Vermont Department of Economic Development ph. (802) 798-2221
Tax Increment Financing (TIF) is a tool that municipalities use to finance improvements for public infrastructure like streets, sidewalks and storm water management systems. The improvements serve a specified area known as a TIF District. Barre, St. Albans, Hartford and other Vermont towns have proven that TIF leverages additional private investment that builds and renovates the housing, commercial, and retail space needed to grow jobs and the economy.
After creation of a TIF District by a municipality and approval by the state, voters authorize municipal bonds or other debt to finance construction or improvement of public infrastructure to serve the TIF District. As the infrastructure is built and improved, the private sector follows with investments in new and renovated buildings. This private investment incrementally increases the value of the grand list. The boost in the value of the grand list and the generation of incremental revenue are the result of the TIF financing that paid for the infrastructure improvements that attracted new investment, business and visitors.
While the infrastructure debt is being repaid, the entire Original Taxable Value, or base level of annual property taxes generated within the District goes to the Education Fund. Of the increased property tax revenue, up to 75% is retained by the municipality to finance infrastructure debt. A minimum of 25% of the increased revenue is sent to the Education Fund. After 20 years, the grand list value of the properties within the TIF District are substantially increased because the infrastructure investment supports and enables increased private sector investment. From that point forward, the base and the entire increase in property tax revenue are paid to the Education Fund in perpetuity.