December 12, 2018
Province of Manitoba Announces New Framework for Tax Increment Financing
The government of Manitoba is introducing a new Tax Increment Financing (TIF) Framework that will strengthen the use of TIF as a tool to support economic growth across Manitoba, Municipal Relations Minister Jeff Wharton announced today.
“Leveraging private-sector investment and ensuring a return on investment for Manitobans are two goals of the framework,” said Wharton. “Our government will work with key stakeholders to develop the application process, identify investment priorities and outcome-based performance measures.”
The new Tax Increment Financing Framework is based on seven principles including:
1. Clear, formal process with transparent application and criteria.
2. Minimal risk to Manitoba.
3. A whole-of-government approach.
4. Municipal alignment and collaboration.
5. Targeting development through strategic use of TIF.
6. Demonstrated value to Manitoba and the local community.
7. Leveraging substantial private investment and alignment with Manitoba’s economic development plans.
The new framework will establish a clear and formal application package, and approval process. It will also communicate TIF requirements and report on TIF outcomes. The goal is to provide access to clear information about TIF and foster a more transparent process, Wharton said.
A key element of the new TIF Framework is minimizing risk to the province, the minister noted. Tax increment financing will only be used when there is a clear benefit to Manitoba, and payments will only be made once the taxes have been collected, with no up-front payments.
The new framework will also establish formal working groups with the City of Winnipeg and the Association of Manitoba Municipalities among others, which will enable the province to work collaboratively on TIF projects as well as commence long-term strategic planning for investment in areas of mutual interest. This also supports the government of Manitoba’s commitment to strengthen the partnerships with the city and rural municipalities through ongoing dialogue to identify local priorities and alignment with provincial priorities.
Under the new framework, TIF will be used in partnership with municipalities and regions, which will allow Manitoba to prioritize investment based on a value for money model, while helping to address the need for economic diversification across the province. Targeting development will assist in stimulating growth across industrial sectors as well as address critical issues in specific key sectors.
The framework will also ensure that TIF is only used where there is clear return on investment for Manitoba. By aligning TIF support with the provincial economic development strategy, it will ensure these investments are supporting what Manitobans want and provide an opportunity to establish strategic partnerships with municipalities and business leaders to create new growth opportunities for Manitoba, the minister noted.
“We are working in collaboration across government and with municipalities to develop clear processes, identify needs and coordinated strategic planning,” said Wharton. “This provides an opportunity to use TIF as a catalyst to drive economic growth and leverage private investment across Manitoba.”
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Backgrounders
TIF Questions & Answers - https://www.gov.mb.ca/asset_library/en/newslinks/2018/12/BG-TIF_QA-MR.pdf
TIF Infographic - https://www.gov.mb.ca/asset_library/en/newslinks/2018/12/BG-TIF_Graphic-MR.pdf