Tax Increment Financing (TIF)
Contact: Shane Coelho, Sr. Management Analyst 316-722-7561
Tax Increment Financing (TIF) is a real estate redevelopment technique applicable to industrial, commercial, and residential projects. TIF uses the anticipated increases in real estate tax revenues and local sales tax revenues to retire the bonds sold to finance-qualifying redevelopment costs (K.S.A. 12-1770 et.seq.). Monies raised through TIF may be used for initiatives selected and administrated by local governments, such as land acquisition, site preparations, and other related costs. TIF cannot be used for the construction of privately owned buildings. TIF works for both privately owned land and publicly owned land to be sold for redevelopment. TIF is possible only if private development would not occur without the improvements. Advance developer commitment to the project is essential. TIF cannot be used speculatively to prepare a site for development. Businesses have found that TIF offers several distinct advantages. TIF implementation allows the financing of land acquisitions and other allowed costs with tax-free borrowing. Thus, interest costs are reduced. Also, TIF offers businesses the opportunity to purchase renovated sites at sub-market costs.