State Comptroller Justin Wilson writes in an op-ed piece:
Early in the session and with little fanfare, lawmakers approved legislation that has the potential to create many new jobs in communities throughout our state. It’s called the Uniformity in Tax Increment Financing Act of 2012, a measure that gives economic development officials in our cities and counties an attractive incentive to offer businesses.
Tax increment financing — or TIF, as it is frequently called — is a method for paying for community improvements with future tax revenues. For example, consider what happens when a government decides to invest in new roads, street lights, water and sewer lines or other infrastructure improvements in a neighborhood.
Typically, the value of the property in that neighborhood will increase, which means tax collections from the area should also increase. TIF uses the extra tax revenues collected after the property value rises to recoup the costs of the government’s infrastructure investments.
In other words, it’s a way to allow growth to pay for itself. While we had laws on the books allowing for TIF before this year’s legislative session, they were confusing and sometimes contradictory.