Trouble with TIFs in Hillsborough?

Via Bill Varian at the Times:

If you live in Brandon, the money you pay in property taxes each year can go to fill potholes in Westchase or toward part of the salary of a firefighter based in Apollo Beach.

Those tax dollars flow into a general pot and county commissioners decide where they're needed most.

But in more than a half-dozen places in the city of Tampa, a portion of residents' tax payments stays in their neighborhood. City officials decided at some point that those area, including Ybor City and Drew Park, deserved special attention to fight blight.
Hillsborough County commissioners are now considering a similar approach of retaining tax dollars in specific, struggling neighborhoods in the name of promoting economic development. The money could go toward widening or repaving roads, fixing flooding problems and making the selected places more attractive for people looking to build a home or business.

The option they are considering for funding this?  Tax Increment Financing.

Hillsborough commissioners voted unanimously two weeks ago to consider creating the so-called tax increment finance districts in three areas: near the University of South Florida, near the Florida State Fairgrounds and in the neighborhoods of Progress Village, Clair-Mel and Palm River along Causeway Boulevard. 

Perhaps these areas do need improvements.  Not everywhere is above average.

Yes, this is urban blight.

More from Varian:

Here's how tax increment finance districts generally work: Elected officials identify a specific geographic area as blighted or in need of special attention. They then develop a plan for how to address the blight and, hopefully, make it a more inviting place to live or work.

They would then establish a base year, after which the area's growth in county property taxes would have to be spent there.

Emphasis mine.  Sounds like free money, doesn't it?  Why hopefully then?  TIFs are not without risks.  From Wikipedia:

Tax Increment Financing dedicates tax increments within a certain defined district to finance the debt that is issued to pay for the project. TIF was designed to channel funding toward improvements in distressed, underdeveloped, or underutilized parts of a jurisdiction where development might otherwise not occur. TIF creates funding for public or private projects by borrowing against the future increase in these property-tax revenues.

So in other words, TIFs channel the hoped increase in revenues to benefit the targeted area, financed by debt issued against the hope (that word again) that the increasing tax revenues will pay it back.

What happens if the hope does not work out as planned? The rest of Hillsborough County gets the bill with increased taxes or reduced services.  The redevelopment areas get the benefits, the rest if the county assumes the risks.

Some other concerns:

• Development may occur in these areas anyways.
• If they are successful, they may put additional strain on public services such as fire, police, water,  sewer and roads, which may not be paid for by TIF
• Opens up for abuse of eminent domain laws.  The awful SCOTUS Kelo decision was based on a eminent domain to fund a private development based on TIF.
• Can lead to political cronyism for the big development crown - real estate developers, land use attorneys, urban planners, etc.
• Sets up different rules and priorities for other development needs throughout the county.
• Reduces flexibility to adjust to the changing needs of the county.

Perhaps they can consider other incentive programs.  There are 20 programs listed by the City of Tampa alone.  

OK, perhaps 20 is a bit much, and needs consolidating.  But you get the point, right?

Jan Platt, long time Democratic politician in these parts, understands.

Critics, such as former County Commissioner Jan Platt, say such districts restrict elected officials from making spending decisions that are in the best interest of the entire community. They limit flexibility.

"That's just as true today as it was then," Platt said of Crist's previous push for a special taxing district near USF. "It's just completely opposite what needs to be happening in this day and time."

Chicago was an early an ardent user of TIFs.  Need I say more? Don't end up like California.  They invented TIFs, but they are now discontinued   But they'll be paying back over $28B in debt for a long time.

Hopefully.