November 26, 2008
Innovative Tax Increment Financing Would Support Revitalization Initiatives: Ashton
The province is reintroducing legislation that would support the revitalization of communities in Winnipeg and across Manitoba through the use of tax increment financing (TIF), Intergovernmental Affairs Minister Steve Ashton announced today.
The bill has been strengthened to reinforce that these funds would be used in partnership with municipalities and amendments have also been proposed that would strengthen accountability and transparency, the minister said.
“Our priorities for TIF include support for the further development of Winnipeg’s inland port, rapid transit system, as well as affordable housing in downtown Winnipeg,” he said. “These projects will help grow our economy and build communities during tough economic times.”
The Community Revitalization Tax Increment Financing Act would provide an innovative way to support shared municipal and provincial priorities that would focus on the revitalization of Winnipeg, Brandon and other Manitoba communities, he added.
Tax increment financing had been requested by the City of Winnipeg, Centre Venture and the City of Brandon. The City of Winnipeg and other municipalities currently have municipal tax increment financing authority.
Under the bill, municipalities and school boards would be consulted before a property is designated as a community revitalization property or area. Once the community revitalization area has been designated, the incremental property tax increases in the area that result from the development would be placed into a separate fund to help pay for improvements in that area.
Money collected from a community revitalization property would then be invested only in the same designated area. The municipality would have to agree with the project that the fund would be used for.
Additional amendments to further enhance accountability and transparency have also been proposed to ensure the fund must be audited and the use of the funds must reported annually. Once the area has been redeveloped and the TIF designation is lifted, the expanded tax base would return to the school division.
Tax increment financing is used in several American cities to support revitalization and renewal initiatives. In Manitoba, these levies would be used to support significant economic development, community revitalization such as housing, social and cultural development, and heritage preservation.
“It is our intent to consult with and report on the use of tax increment financing to ensure full accountability and support for our priorities,” added Ashton.
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