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Tax increment financing
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==History== Tax increment financing was first used in California in 1952 and there are currently thousands of TIF districts operating in the US, from small and mid-sized cities to large urban areas. As of 2008, California had over four hundred TIF districts with an aggregate of over $10 billion per year in revenues, over $28 billion of long-term debt, and over $674 billion of assessed land valuation.<ref name="California_TIF">{{citation |url=http://www.sco.ca.gov/Files-ARD-Local/LocRep/redevelop_fy0708redev_reports.pdf |title=California State Controller's Annual Report on Redevelopment Agencies, 2007-2008 |access-date=2009-12-04 |archive-url=https://web.archive.org/web/20100105093005/http://www.sco.ca.gov/Files-ARD-Local/LocRep/redevelop_fy0708redev_reports.pdf |archive-date=2010-01-05 }}</ref> The state of California discontinued the use of TIF financing due to lawsuits in 2011, and enacted the California Fiscal Emergency Proclamation 2010, thereby ending the diversion of property tax revenues from public funding, including the use of TIFs for the funding of the nearly 400 redevelopment agencies in the state.<ref>[http://ti.org/antiplanner/?p=6059 "Urban Renewal Dead in California,"] ''The Antiplanner'', Thoreau Institute (2 January 2012).</ref><ref>See California Redevelopment Association v. Ana Matosantos.</ref> The RDAs appealed that decision, though they were eventually eliminated in February 2012 after the passage of the 2011 state budget.<ref name="lawsuit" /><ref>{{Cite web|url=http://www.dof.ca.gov/Programs/Redevelopment/|title=Redevelopment Agency Dissolution|website=www.dof.ca.gov|access-date=2019-10-08}}</ref> However, in 2015, the California Community Revitalization and Investment Authority Act was made law, providing for the creation of Community Revitalization and Investment Authorities (CRIAs), funded by Tax-Increment Financing. The primary purposes of CRIAs are the development or preservation of affordable housing for low and moderate income households (a minimum of 25% of TIF funding must be placed in an affordable housing fund) and creation or upgrading of public infrastructure in economically disadvantaged areas as defined under the provisions of the law.<ref name=":0">{{Cite web|url=http://www.scag.ca.gov/Documents/HousingPlanningGuide2016.pdf|title=Mission Impossible? Meeting California's Housing Challenge|last=Southern California Association of Governments|date=October 2016|page=29|access-date=2019-09-20|archive-date=2019-12-12|archive-url=https://web.archive.org/web/20191212051031/http://www.scag.ca.gov/Documents/HousingPlanningGuide2016.pdf|url-status=dead}}</ref><ref name=":1">{{Cite web|url=https://katten.com/Recent_Affordable_Housing_Developments_in_California_and_the_Los_Angeles_Region|title=Recent Affordable Housing Developments in California and the Los Angeles Region|website=katten.com|access-date=2019-09-20}}</ref> Additionally, Enhanced Infrastructure Financing Districts (EIFDs) may be created and financed by TIFs in California.<ref name=":2">{{Cite web|url=http://www.scag.ca.gov/Documents/HousingPlanningGuide2016.pdf|title=Mission Impossible? Meeting California's Housing Challenge|last=Southern California Association of Governments|date=October 2016|page=27|access-date=2019-09-20|archive-date=2019-12-12|archive-url=https://web.archive.org/web/20191212051031/http://www.scag.ca.gov/Documents/HousingPlanningGuide2016.pdf|url-status=dead}}</ref> With the exception of [[Arizona]], every state and the [[District of Columbia]] has enabled legislation for tax increment financing.<ref>[http://www.cdfa.net/cdfa/cdfaweb.nsf/0/8ee94afeece08bc988257936006747c5/$FILE/CDFA-2008-TIF-State-By-State-Report.pdf Council of Development Finance Agencies 2008 TIF State-By-State Report accessed 2014-3-21.]</ref> Some states, such as [[Illinois]], have used TIF for decades, but others have only recently embraced TIF.<ref>Arkansas (2000), Washington (2001), New Jersey (2002), Delaware (2003), Louisiana (2003), North Carolina (2005), and New Mexico (2006).</ref> The state of Maine has a program named TIF; however, this title refers to a process very different than in most states.<ref name="Maine voices">{{cite web | url=http://www.pressherald.com/2013/05/26/tif-helps-communities-that-dont-need-it_2013-05-26/ | title=Maine Voices: TIF helps communities that don't need it: State economic development support should go to towns that can't now take advantage of complex property tax schemes | publisher=Portland Press Herald | date=25 May 2013 | access-date=28 August 2015 | author=Michael Havlin | location=Hampton, Maine}}</ref> Since the 1970s, the following factors have led local governments (cities, townships, etc.) to consider tax increment financing: lobbying by developers, a reduction in federal funding for redevelopment-related activities (including spending increases), restrictions on [[municipal bonds]] (which are [[tax-exempt]] [[Bond (finance)|bonds]]), the transfer of urban policy to local governments, State-imposed caps on municipal [[property tax]] collections, and State-imposed limits on the amounts and types of city expenditures. Considering these factors, many local governments have chosen TIF as a way to strengthen their tax bases, attract private investment, and increase economic activity.
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