Q: What is a T.I.F.
A: Tax Incremental Finance
How does it work? Does it cost more money in the long run? What is so special about it? Why don't we just bond instead?
A TIFF bond is similar to a regular bond in that terms are set up such as a time commitment..20 yr or 30 yr bond.
The difference between the two are that a 20 yr bond /30 yr bond is just what it is.. a 20 yr or 30 yr bond.
A TIF bond CAN be paid-off sooner than its intended life... ie can be paid off in lets say 11 years and without penalty. You can think of it like making an extra mortgage payment at the end of the year, which helps bring down interest payments.
A TIF bond usually starts with very low payments in years 1-3 where as a regular bond would be spread out over life of bond.
Yes Doug is correct in that TIF bonds carry a little bit higher interest rate however its initial low payments and the early pay-off clause make it a winner in the long run. It is true that the TIF bond must be successful in bringing in business to realize the savings.
Also, The state of New Hampshire unlike many other states does not have the power to give tax breaks to companies to try and attract them to our state and its usually a "quality of life" issue that brings companies here. The TIF is one tool that we do have to attract businesses.
Where I think many get confused about TIF's are that they think that these businesses that are attracted, some how get a tax break or benefit from these TIF bonds where in fact the benefit they get is in Infrastructure improvements and in our case the widening of Manchester Rd to make it more commuter and business friendly.
Also with a TIF bond, and with permission from schools and state and county, these other government entities can decide to not take their portion of the local property tax, so that their portion can be used to help pay-off the TIF bond. For example in our TIF district, the school portion of their taxes would not go to schools but to help pay-off the bond instead. Makes sense because businesses don't send kids to schools. After the bonds are paid-off- these businesses would then be helping off set our residential/commercial mix and help offset and lower residential tax burdens.
A regular bond would do neither.
Lets remember that we already have water and sewer down Manchester rd and we have available lots that can be built upon. By creating a better roadway system we help attract business and bring those roadways from failure. Our TIF would only go to making the roadway improvements and would not go to private businesses to help them build their own buildings ( which is what the video that Doug provided says that is what that particular town did) This is an important fact that must be known.
Tax payers float the TIF bond for roadway improvements
Businesses that build new or additional buildings in the TIF district only will have portions of their taxes be paid to pay-off the bond. At no time will taxpayer money go to private business to help them build their buildings. ( all TIF are not created equally). The first three years are very low interest payments ( we have intial money in fund balance to get us started without raising any taxes) and in three years we should be in a better economy.
With success, we can pay this bond off quickly and bring commercial business taxes into the town, bring jobs to our community and help lower our taxes.
These are the two differences between the TIF and regular type bonding. Hope this shes some light to some and would love to hear feedback from others.
Monday, June 22, 2009
Sunday, June 21, 2009
Thursday, June 18, 2009
Time to Focus on the Community.
Mudslinging, personal attacks, political posturing can all lead to a loss of focus on the needs of our community and in economical challenging times, which we certainly have today. We elected people need to come together for the best interests of Derry.
So too, the towns people must cut through all the distracting political super hype and focus on what your elected officials are doing for the town as a whole.
In this up coming fiscal year, the council has CUT taxes by .18 cents/1000 of your homes value. Hard decisions were made and in the end the council did do its job and showed the taxpayers of this town that we are "plugged in".
Now some will say that a small savings will not get much, however there is no way that cutting town side of government is going to make dramatic changes to our tax structure. Big changes, by "down shifting" in State budget will only add to our tax burden while town services will eventually suffer. In the end, its a cruel game of increasing taxes and cut services where we all end up losing. We shall leave state spending to another post on its own.
Anyway, we at town side are doing our part in helping control escalating taxes.
The second leg to bringing taxes down is to bring economic development to town. By achieving a TOTAL commitment in economic development. Ahh, those two words " economic development" have been hollow "buzz" words for years that make one almost electable just by saying the words. This time, All seven councilors are on record to doing and committing to the TIFF district on Manchester Rd as the best option right now in bringing in business. See what a difference a year makes.
( Notice no Burtis comments yet or Rev Joe making statements that Manchester Rd is not in failure. PS to the town newbies, we all know who these two are aligned with! Funny how the mouthpieces fall of the face of the map when their councilors are NOW in favor with it.)
The only question councilors must decide on now is how will we pay for the infrastructure and widening that must get done. Stay tuned. I'm sure it will be interesting in discussions. At least we are moving forward!
So too, the towns people must cut through all the distracting political super hype and focus on what your elected officials are doing for the town as a whole.
In this up coming fiscal year, the council has CUT taxes by .18 cents/1000 of your homes value. Hard decisions were made and in the end the council did do its job and showed the taxpayers of this town that we are "plugged in".
Now some will say that a small savings will not get much, however there is no way that cutting town side of government is going to make dramatic changes to our tax structure. Big changes, by "down shifting" in State budget will only add to our tax burden while town services will eventually suffer. In the end, its a cruel game of increasing taxes and cut services where we all end up losing. We shall leave state spending to another post on its own.
Anyway, we at town side are doing our part in helping control escalating taxes.
The second leg to bringing taxes down is to bring economic development to town. By achieving a TOTAL commitment in economic development. Ahh, those two words " economic development" have been hollow "buzz" words for years that make one almost electable just by saying the words. This time, All seven councilors are on record to doing and committing to the TIFF district on Manchester Rd as the best option right now in bringing in business. See what a difference a year makes.
( Notice no Burtis comments yet or Rev Joe making statements that Manchester Rd is not in failure. PS to the town newbies, we all know who these two are aligned with! Funny how the mouthpieces fall of the face of the map when their councilors are NOW in favor with it.)
The only question councilors must decide on now is how will we pay for the infrastructure and widening that must get done. Stay tuned. I'm sure it will be interesting in discussions. At least we are moving forward!
Wednesday, June 03, 2009
Board appointments should be fair.
Somewhere within the last 3 years the town council has left fairness out of the process of board appointments and have instead made the Planning Board, Zoning Board and Conservation Commission more of a political show than doing the fair and right thing in my opinion.
Many know how I got started in the volunteering on town boards. I started by running the camera equipment for C17 and televised the council meetings at that time. ( i also ran the cameras for both the "friends of education" and the "derry taxpayers" shows) and I guess that was a learning experience in the political process in Derry. I then chaired the cable committee for two years before moving on to Planning board as alternate..then to chairman of planning board, elected twice to town council and had the honor to be chairman of town council and twice pro-tem.
In that process, I had a chance to participate and move through the boards and gained knowledge on behalf of our town. But what message are we sending today on these boards when good alternates, who give of their time and effort are being told that the council doesn't care and they will pick according to political ties instead.
I mean, It used to be as an alternate, if a regular membership was vacant, it was filled by the senior alternate... Common courtesy and protocol. Especially if you have someone new, who shows for every meeting and is interested in helping the community. These are Derry's future leaders after all. We need new people to step up and be willing and eager to step in.
Last night, Once again as in the last 3 years, Mr Hopfgarten was appointed a regular member of planning over Ms Heard. Ms Heard has been an excellent member and is eager to participate. Instead of doing the right thing, again politics played into the decision.
Don't get me wrong, Paul is knowledgeable and will be a good addition to planning but Paul has done this before. He has sat on Planning and is a nine year ex-councilor who has chosen to plug in again to the scene after a small time away. Ms Heard should of been given this seat as a reg member of the board and Paul just was voted in as an alternate this year. My guess is that Paul is using the planning board as a spring board to run for town council again and will give up his seat in March should he be successful in running for council again.
We should go back to the fair and honorable way of appointing board members, Put new people in Alternate positions to learn and get experience, reward good alternates to regular membership when it happens and to let new blood into the process when the opportunities come.
I have seen 4-5 people who finally said that they were overlooked because of politics and felt nobody cared and not being rewarded by moving up the ladder, left volunteering for the town. What a shame.
What are your thought?
Many know how I got started in the volunteering on town boards. I started by running the camera equipment for C17 and televised the council meetings at that time. ( i also ran the cameras for both the "friends of education" and the "derry taxpayers" shows) and I guess that was a learning experience in the political process in Derry. I then chaired the cable committee for two years before moving on to Planning board as alternate..then to chairman of planning board, elected twice to town council and had the honor to be chairman of town council and twice pro-tem.
In that process, I had a chance to participate and move through the boards and gained knowledge on behalf of our town. But what message are we sending today on these boards when good alternates, who give of their time and effort are being told that the council doesn't care and they will pick according to political ties instead.
I mean, It used to be as an alternate, if a regular membership was vacant, it was filled by the senior alternate... Common courtesy and protocol. Especially if you have someone new, who shows for every meeting and is interested in helping the community. These are Derry's future leaders after all. We need new people to step up and be willing and eager to step in.
Last night, Once again as in the last 3 years, Mr Hopfgarten was appointed a regular member of planning over Ms Heard. Ms Heard has been an excellent member and is eager to participate. Instead of doing the right thing, again politics played into the decision.
Don't get me wrong, Paul is knowledgeable and will be a good addition to planning but Paul has done this before. He has sat on Planning and is a nine year ex-councilor who has chosen to plug in again to the scene after a small time away. Ms Heard should of been given this seat as a reg member of the board and Paul just was voted in as an alternate this year. My guess is that Paul is using the planning board as a spring board to run for town council again and will give up his seat in March should he be successful in running for council again.
We should go back to the fair and honorable way of appointing board members, Put new people in Alternate positions to learn and get experience, reward good alternates to regular membership when it happens and to let new blood into the process when the opportunities come.
I have seen 4-5 people who finally said that they were overlooked because of politics and felt nobody cared and not being rewarded by moving up the ladder, left volunteering for the town. What a shame.
What are your thought?
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