Is a City Revitalization & Improvement Zone the same as a tax-increment financing district?
“Is a CRIZ the same as a tax-increment financing district?
No.
Tax-increment financing (TIF) districts work off a similar concept: finance development by borrowing money repayable with the extra taxes generated by that development.
The main differences include:
• TIF program guidelines specify environmental remediation as an eligible cost paid by those additional taxes. CRIZ rules do not – although site clean-up costs might qualify if essential to redevelopment there.
• State officials require local leaders to demonstrate blight or pollution in an area where they want a TIF district, but don’t with a CRIZ.
• The state says it intended to benefit smaller communities through the TIF program; the CRIZ program is mainly intended for cities with populations over 30,000.
• A TIF utilizes only all additional local property taxes to pay debt. CRIZ revenue does not include local property taxes, but does include other local and state taxes with few exceptions.
• CRIZ obligations are issued by the zone’s contracting authority, which typically is created specifically for the CRIZ designation.
• Municipal authorities or the state issue TIF debt, and the state guarantees it, up to $5 million per project or $100 million statewide through its Commonwealth Financing Authority, or Pennsylvania Economic Development & Financing Authority.”
NewsWorks 10 October 2014.