Tax increment financing (TIF) is an economic development strategy for assisting economically distressed or blighted areas of a municipality to develop or redevelop where it would not occur solely through private investment within the reasonably foreseeable future.
Local governments can use tax increment financing to publicly finance needed structural improvements and enhanced infrastructure within a defined area to promote the viability of existing businesses and to attract new commercial enterprises to the area.
Tax increments are simply the increase of property tax revenues over and above a base value established by the municipality in the base year. The purpose of TIF is to facilitate development or redevelopment of an economically disadvantaged area. This is done through the use of the tax increment funds generated by the zone and used for public improvements and to assist private initiatives in the zone. These improvements enhance the value of real property located within the zone.
TIF Reinvestment Zones - Waco has three zones established for tax increment financing (see map):
Facade Improvement Grant Program (Throughout TIF Zone One): is a special program designed to assist smaller projects with a grant of $500 up to $45,000 (10% - 50% of the total project cost) to restore, stabilize, repair and significantly improve the appearance of a dilapidated building within TIF Zone One.
Brazos Promenade, Phases I- III (Riverfront & University Parks Dr.) this major mixed-use project on the Riverfront will include hotels, multi-family residences, restaurants, offices, entertainment venues, the Farmer’s Market and a parking garage with public parking.
The following questions are provided to help potential applicants determine project eligibility:
Does the project:
a. benefit the general public?
b. create a positive economic impact in the zone?
c. increase property value?
d. create jobs?
e. revitalize vacant land or structures?
f. have other sources of support?
Is he project consistent with:
a. TIF Goals and Objectives?
b. The City of Waco's Comprehensive Plan?
c. Imagine Waco Plan?
Depending on location, is the project consistent with the:
a. Downtown Overlay Zone?
b. Brazos Corridor Overlay Zone?
c. University Overlay Zone?
The TIF board consists of eight members. The Waco City Council appoints 5 board members, and the three participating taxing entities (McLennan County, Waco Independent School District, McLennan Community College) each appoint a board member. The TIF board recommends the development of project and financing plans and serves in an advisory capacity to the City Council concerning development activity and expenditure of increment funds in each of the three zones.
Potential applicants are encouraged to contact Economic Development Staff and arrange a meeting (254-750-5640) to ascertain whether the public improvements associated with the proposed project may be eligible for TIF funding. TIF funding requests will be presented to the TIF board with a recommendation from staff and City Center Waco. After the TIF Board votes on the item it will go to the City Council for consideration. Two City Council meetings are required to approve (or disapprove) the funding of a project. If the project is approved by City Council, the City of Waco will enter into a contract for the reimbursement of the amount of TIF-eligible work approved by City Council.
All contractor(s) doing the work on the project must secure appropriate permits, insurance and bonding before any work is done. All completed work must be certified in compliance with applicable City codes and construction standards prior to any TIF funds being reimbursed.
NOTICE: Please set aside time to discuss your project plans with Economic Development staff (254) 750-5640) PRIOR to any work being done on the project to determine what items may be considered eligible for TIF funding, and to assist you through the application process.