The TIF show and an Ole Seagull’s simplified “but for” TIF test

In its most idealistic sense, TIFs are supposed to be used to redevelop “blighted” areas where “but for” the use of the TIF such redevelopment wouldn’t take place. In practical application however, greedy developers, politicians, professional bureaucrats, and locally elected officials with “economic eyes” bigger than their stomachs have, in the opinion of an Ole Seagull, prostituted the definition of “blighted” and the “but for” aspects of the TIF process to the point where they mean whatever those who want a TIF want them to mean. What’s the net result?

Vacant land and a vibrant busy downtown are declared “blighted.” Vacant land that has never been developed is “redeveloped.” As an example, is it reasonable to conclude, that with the new high school, recreation complex, Branson Landing, and the steady expansion of the city of Branson northward along the Highway 65 corridor, that development of that area will not take place “but for” the use of a TIF?

In the opinion of an Ole Seagull, in Branson Hills, as was the case on the Lake Taneycomo Lakefront, development was, is, and will take place without a TIF. Oh it won’t be as quick and grandiose as some would like but it will happen. And, when it does, it will happen without the potential loss in tax revenues it could bring to other taxing entities such as the Branson R-4 school district, county government, the ambulance district, and other entities that rely on real estate or sales tax for huge portions of their operating budgets.

One interesting aspect about a TIF is that it can be done without the approval or consent of other taxing entities affected by the TIF. As an example, the city of Branson can impose a TIF that could cost the Branson R-4 School District millions of dollars in real estate tax revenues without their consent. Of course, the developers, who will benefit from the TIF and others supporting it, will present their optimistic estimates but, what does the actuality of the Branson Meadows TIF indicate about relying on those estimates?

In an Ole Seagulls opinion, there is an excellent chance they will be wrong. Why? The whole TIF system is set up to neuter effective general public participation in favor of those seeking the TIF. The composition of the TIF commission, economic estimates predicting what will happen twenty years in the future, the legal fiction used to define a “blighted area,” the “but for” test, etc. are but a legalistic and bureaucratic “smoke and mirrors” TIF show.

The TIF show is designed, controlled, and manipulated to insure that those wanting a particular TIF get it. It creates the illusion that the public actually participated in the process in an effective manner while at the same time insuring that there is no current test or bench mark that they can use to easily and conveniently evaluate whether or not a TIF should be authorized for any given project.

How about using the Ole Seagull’s “but for” test as a starting point. “But for” the willingness of the city of Branson, or any other city or government entity seeking to authorize a TIF, to exempt all school districts, county governments, and other taxing entities from the TIF, a TIF will not be authorized. It doesn’t get much simpler, no exemption for other taxing entities, no TIF.

Will that stop TIFs? No, that’s not what is intended. It will however, in an Ole Seagulls opinion, mitigate the number of TIFs, the size of their indebtedness, and place the entire risk where it belongs, on the backs of those who seek, control, and authorize TIFs. At the same time it will provide the public with a simple initial bench mark for use in determining the appropriateness of a TIF for a particular project.