Meeting Public Comments

Nicolas Hockenberry [Jackson County Economic Alliance]

Does the bills language seek to eliminate grandfathered perpetual economic development TIF districts or does it also seek to eliminate Slum & Blight TIF districts as well?Does the bills language seek to reduce the base by 10%/yr of urban renewal areas or TIF district within urban renewal areas? If TIF districts, does it seek to reduce the base of all types of TIF districts (ED, housing, Slum/Blight)?Depending on the answers to those questions this bill could be a devastating blow to rural communities, effectively removing their sole economic development tool.

Nick Glew [Marion Economic Development Corporation]

As you know, tax increment financing is the only economic development tool that we have left at the local level. We strongly believe this to be an important topic of local control to grow communities and as a result grow Iowa.TIF districts in Iowa that have been in place for long periods of time are key assets to leverage for the right economic development projects. In my community our economic development organization partnered with our city and utilized TIF to construct improvements for a Certified Industrial Park. Already more than $40M of private investment now contributes to the state economy. This project is located in a district impacted by this bill. When we financed the improvements, we used the strong cash flow of the mature district to back very favorable lending rates. The very first project that landed in the park more than paid for the short term debt on this development. This is one approach/example that would be highly impacted.Other districts simply take a long time to develop any increment. We have a classic former railroad corridor as an example. Its not uncommon for districts like this to be used to revitalize areas that are already built out where nearly every project involves taking down structures to replace with new. Brownfield elimination districts were given much longer lives for this reason. My assumption is that many rural communities also use these types of districts to leverage state and federal funds for downtown revitalization projects and other CDBG projects.A few years ago I put together a rather simple video on the topic of TIF. I bring it to your attention today because it addresses the topic of the backfill to schools. It can be accessed direct at https://youtu.be/hJ88UMARnM. If you go to the 10:15 section of the video and watch it for 2 minutes, youll see an example of how backfill is not a cost to the state, it is a positive result of new projects that we attract where everyone (including the state) wins. These are hard numbers to get to and numbers I do not think the state fully quantifies. The expense is perhaps being looked at without seeking the offsetting revenue in both payroll and sales taxes generated by the same projects.Please remember that when a community is not leveraging unused increment in a TIF District, its treated as normal property tax revenue and split normally to all taxing entities. However, having the ability to leverage the power of some of these older districts for the right projects is critical for communities and counties of all sizes to continue to compete in our global economy.Thank you for your service to our state.

Mike Van Milligen [City of Dubuque]

Dear Representatives Hite, Hein, and Isenhart,I am writing to provide input on HSB 194, which proposes to modify urban renewal legislation in a way that eventually terminates urban renewal areas not currently subject to statutory sunset, reducing a communitys ability to address slum and blight and economic development. The City of Dubuque is opposed to this bill.Chapter 403 created urban renewal authority to remediate slum and blighted conditions, to promote economic development, and to prevent a shortage of housing. One benefit of this authority is the ability of a jurisdiction to use Tax Increment Financing (TIF). Since the City of Dubuque began using TIF in earnest in the 1990s, there have been a total of 90 major projects which have had the benefit of $66 million in direct TIF incentives to date. These projects have leveraged over $740 million in private investment more than tenfold the TIF investment! These projects have resulted in the creation and retention of nearly 11,000 jobs in Dubuque. This does not include the many jobs added to the downtown employment base where there was no direct TIF agreement with the employer, but rather the projects were facilitated by loan pools and other methods benefiting from the Downtown TIF District. Much of this growth is due to the predevelopment work done in our industrial park. Dubuques City Council has had the foresight and fortunately the TIF funding to accomplish acquisition, planning, grading, paving, and utility work that sets the stage for attracting new companies to our market as well as providing ample room for growth for existing companies that wish to expand in Dubuque. Local expansion accounts for 85% of job creation in Dubuque.These employees own homes that contribute to the property tax base, and they frequent retail businesses and restaurants that pay property and sales taxes. All of this helps our state and local economy.TIF also remediates slum and blight, which is a continual effort not a feat easily accomplished in 20 years. A decade ago, work began in earnest in our Historic Millwork District, with the goal of rehabilitating over a million square feet of abandoned warehouse space into a mixeduse neighborhood. Such an enormous undertaking cannot be accomplished in a short period of time. It has taken a decade to get a handful of buildings redeveloped, with strong publicprivate partnerships. TIF was the Citys way to participate in that partnership. TIF served not just as direct support for projects, but also served as match for significant federal grants leveraging additional investment in the area.The area has begun to show its true potential by offering quality residential space and vibrant retail/entertainment options. But the work is far from over. Terminating the urban renewal area that encompasses the Millwork District in 10 or fewer years from now which this legislation would do leaves the work unfinished, without the potential for the City to partner on its growing success.The City also focuses on other areas of our downtown in need of investment, such as the Central Avenue Corridor and the adjacent Washington Neighborhood. Partnering with private developers, businesses, and investors is how we will be able to create a downtown that is attractive for our residents both aesthetically and economically. The use of TIF is critical to supporting these redevelopment projects over the long term.HSB 194 has the effect of terminating all urban renewal areas in 20 or fewer years. This time limit is impractical for the removal of slum and blight, which requires extensive public planning, coordination, and partnership from the private sector.Cities are extremely limited financially in their ability to accomplish the work needed to meet the needs of their residents. The only current economic development tool for communities in Iowa, both large and small, is TIF. Dubuque strives to create a community of choice, which in the age of remote work becomes ever more important. Attracting new residents to our state requires that we remediate slum and blight and create economic conditions that our young workforce is seeking. We use TIF not only as a funding source for industrial park development, but also for community development amenities like neighborhood park improvements.Thank you for your consideration of our request to retain Tax Increment Financings impact in our community by opposing HSB 194. The abovementioned successes would not have been possible without the current program.