Governor’s 2014-15 Budget Summary Proposes Expanding Tax Increment Financing
Proposed Changes to Infrastructure Financing District Law
Now Governor Brown released his 2014-15 Budget Summary. It has an offer to grow the tax increment financing utilized by Infrastructure Financing Districts (IFDs) for uses not presently approved under law.
Particularly, the Administration proposes legislation to:
(1) expand the kinds of projects that IFDs can fund to incorporate military base reuse, urban infill, transit priority projects, affordable housing, and connected necessary consumer services
(2) allow metropolitan areas or counties that meet specified benchmarks (discussed below) to produce these new IFDs, and also to issue related debt, susceptible to receiving 55 percent voter approval and
(3) allow new IFD project areas to overlap using the project regions of former redevelopment agencies, while strictly restricting the accessible funding in individuals areas to dollars available after payment on all the former redevelopment agencies’ approved obligations.
If your city or county formerly operated a redevelopment agency, the expanded IFD tool could be at hand only if they satisfy the following benchmarks:
(1) Receipt of the Finding of Completion in the California Department of Finance
(2) Compliance with all of Condition Controller’s Office redevelopment agency audit findings and
(3) Conclusion associated with a outstanding legalities between your redevelopment agency’s successor agency, the town or county that produced the redevelopment agency, and also the condition.
The IFD proposal includes elements present in bills which are presently within the Legislature, including AB 229 (Perez), AB 243 (Dickinson), Senate bill 33 (Wolk) and Senate bill 628 (Bell). Exactly how the Governor’s proposal will move ahead isn’t yet obvious, as it might participate your budget process like a trailer bill or might find its distance to another bit of legislation.
The proposal as outlined is less aggressive than other proposals within the Legislature to amend the IFD law and also the suggested benchmarks might not make sure they are practical in lots of communities. However, the proposal does suggest expanding using IFDs like a tool for economic development. Other tools for economic development discussed within the Governor’s Budget Summary include issuance of general obligation bonds and lease revenue bonds, in addition to growing local tax rates.