Enhancing accountability on economic development projects

The Iowa Senate has voted to increase accountability and transparency when your tax dollars are spent for local economic development.

We support Tax Incremental Financing — better known as TIF — because it is an important economic development tool for cities and counties. After a TIF district is created, the property tax income generated from increased property values in that area are diverted from schools, cities or counties and used instead for economic development efforts in the TIF area.

House File 2460, as amended by the Senate, requires robust reporting, increases transparency and puts some restrictions on how communities use TIF. For example, the legislation would prevent TIF dollars in certain instances from being used to “steal” businesses away from a neighboring community. The bill also ensures taxpayers know how their property taxes are affected by TIF projects.

HF 2460, as amended by the Senate, now goes back to the House for their further consideration.