What is a Tax Incremental District?

What is the difference between TIF and a Tax Incremental District (TID)?

TIF — an economic development technique to expand the property tax base. Property value increases fund site improvements that would not otherwise occur.

TID — the actual physical area (whole parcels) designated for improvements using tax incremental financing

2. What is the Wisconsin Department of Revenue's (DOR) role?

TIF is intended to be locally initiated and managed, with minimal State oversight. However, DOR cannot certify a tax incremental base until we determine procedures were followed, documents were completed correctly, and notices were provided timely.

Facts supporting any document adopted or action taken by the local governing body are not subject to review by DOR. The municipality's documents and proposed project costs must comply with state law. A municipality is encouraged to consult with an attorney and auditor about any questions.

If you have questions about a specific project in a TID, contact the municipality or the members of the Joint Review Board (JRB) that approved the TID project plan and boundaries

3. What statutes regulate TIF?

Village and City (regular) — sec. 66.1105, Wis. Stats.
Town — sec. 60.85 and sec. 60.23(32), Wis. Stats.
Environmental remediation (municipal resolution adopted before November 29, 2017) — sec. 66.1106, Wis. Stats.

4. How is TIF funded?

When a TID is created, the municipality and other taxing jurisdictions agree to support their normal operations from the existing tax base within the district. Property taxes for the school, county, technical college, and municipality are based on the taxable value of the TID at the time it is created. The municipality funds development through the increases to the property values in the TID. The taxes on the TID value increment (the difference between the TID's current value and the TID's base value), results in additional revenues collected for the district's fund. The municipality must use the funds to pay eligible TID costs. When costs are paid and the municipality closes the TID, the increased tax base is shared with all taxing jurisdictions.

The State of Wisconsin does not collect or pay tax increments to municipal governments.

5. Besides a municipality, what are the other taxing jurisdictions?

The other taxing jurisdictions are the school district, county, and technical college. A municipality may also have a lake district, sanitary district or metro sewer district.

6. Are there limits on the use of TIF?

Yes. State law limits a municipality's ability to create new TIDs and add property to existing TIDs. The equalized value of property in the TID, plus the value increment of all existing TIDs cannot exceed 12% of the total municipal equalized value. This restriction does not apply to an Environmental Remediation TID created under sec. 66.1106, Wis. Stats., or when subtracting territory from a TID. For more information, review the Value Limit Common Questions.

7. What is the TID maximum life with or without extensions?

The TID maximum life without an extension depends on the TID type declared in the creation resolution and the date the municipality adopted the resolution. For more information on the maximum life without an extension for each type, see the TID Criteria Matrix.

The municipality can approve an extension as a separate resolution later in a TID's life. The TID maximum life with an extension depends on the extension type. See TID Extension Types for extensions available including the length.

8. How can I obtain information (ex: map, parcels) about a specific TID or TIDs throughout the state?

Contact the municipality where the TID is located for information on a specific TID. Visit the DOR Reports page for yearly statewide TID reports; select "Tax Incremental Financing" as the category.

9. When property is in a TID, does that change how the property assessment is determined?

No. Property in a TID is assessed the same way as other taxable property. See the DOR Guide for Property Owners for more information.

Source: https://www.revenue.wi.gov/Pages/FAQS/slf-tif-general.aspx

What is a TID Overlap?

An overlap is when the boundary of one Tax Incremental District (TID) covers another existing TID's boundaries. For more information, review state law (sec. 66.1105(10), Wis. Stats.). The newest overlapping TID includes the current value in its TID base and will receive future increment value.

The older overlapped TID includes the increment value it received before the overlap, but no longer receives any future increment. The current value of the existing TID before the new overlapping TID was created becomes a 'frozen overlap value.' The Wisconsin Department of Revenue (DOR) establishes the frozen overlap value and includes it in the older TID's total current year value until the TID terminates.

The current value of overlapped property, at the time it is overlapped, is the 'frozen overlap value.' DOR establishes the frozen overlap value for the overlapped TID.

Example:

TID 1 is partially overlapped by TID 2
TID 1's base value does not change
In the year of the overlap, the current full value of the overlapped property is $10,000
After DOR certifies TID 2, DOR includes the $10,000 frozen overlap value in TID 1's current value
DOR adds the $10,000 frozen value to TID 1's current value every year until the TID terminates
The frozen overlap value will not change
- Exception: Additional property in TID 1 is overlapped
The current values plus the frozen overlap value equals the total value used to calculate the TID increment (see table below)
In the below example, the total current year TID 1 value is $275,000 (property value $265,000 plus $10,000 frozen overlap value)
Current value ($275,000) minus base value ($150,000) equals a TID increment value of $125,000

Source: https://www.revenue.wi.gov/Pages/FAQS/slf-tif-overlaps.aspx

TID #2 Facade Grant Program

The TID #2 Façade Grant Program Grant (FGP) is designed to provide an incentive for private sector improvement of commercial buildings in Campbellsport’s Tax Incremental District #2 (TID #2). The FGP program aims to make revitalization efforts more affordable by providing matching grant funds for 30% of the project up to $10,000. This program is geared toward façade projects that protect the historic integrity of the building and improve the overall appearance of the Uptown area. Priority awarding is given to TID #2 façade projects. The FGP program is funded and administered by the Village Administrator under the supervision of the Campbellsport Village Board.

To request an application, and grant program information, please contact Village Administrator Charlie Kudy at charlie.kudy@cportvill.com