WHAT is TAX INCREMENT FINANCING (TIF)

You may have heard the town or developers talking about “TIF” zones. TIF stands for “Tax Increment Financing”.

In a TIF zone, the extra realization of property taxes meant for the community as a whole are instead, targeted to fund ONLY the TIF-designated area within the community.

You can read a definition of TIF here, as well as read about the potential drawbacks to the taxpayers.

“Some criticize TIF, saying it results in taxpayer subsidies for private business. That’s because TIF projects often include property tax rebates for developers as an incentive to develop the neighborhood targeted for renewal. Another complaint about TIF is that it can happen behind closed doors, without public input or say-so such as you would get if the city’s residents voted on bonds for the same project. Finally, critics also say that TIF leaves taxpayers vulnerable if developers change their mind or back out of the project. In that case, taxpayers could be on the hook without the option to share in the profits developers would earn.”

Some would argue that a TIF is unconstitutional under NH law:

[Art.] 12. [Protection and Taxation Reciprocal.] Every member of the community has a right to be protected by it, in the enjoyment of his life, liberty, and property; he is therefore bound to contribute his share in the expense of such protection, and to yield his personal service when necessary. But no part of a man’s property shall be taken from him, or applied to public uses, without his own consent, or that of the representative body of the people. Nor are the inhabitants of this State controllable by any other laws than those to which they, or their representative body, have given their consent. ~ June 2, 1784

If “he is therefore bound to contribute his share”, how does everyone “share” what stays in only one part of town?