Why would a community use a TIF?

A community, like a city or village, might utilize Tax Increment Financing (TIF) or Tax Increment Districts (TID) as a means to promote economic development and revitalization within designated areas. By establishing a TIF/TID, the community can capture the incremental increase in property tax revenues generated by improvements and developments in the district. These funds are then reinvested into the district to finance public infrastructure projects, encourage private investment, and stimulate economic growth without directly impacting the tax burden on existing residents. TIF/TID arrangements serve as powerful tools for municipalities to strategically shape their urban and economic landscapes while fostering sustainable development and job creation. New economic development increases tax base so residents do not experience higher property tax bills in the future. The City of Hillsboro's Common Council wishes to ensure high-quality services and amenities, with the lowest required taxes possible.