TRAVERSE CITY - The Traverse City Downtown Development Authority voted Friday to approve a new Tax Increment Financing plan that will amend and extend the original TIF-97 plan.
Their action - dubbed "Infrastructure First TIF Plan" – will now go to the city commissioners. Commissioners will need to wrap up their review of the TIF plan by late July in order to make state filing deadlines for the Nov. 3 ballot.
Then it will be up to the voters to decide, as mandated by the city charter.
"Approval of the Infrastructure First TIF Plan by the DDA marked an important milestone for Traverse City – and our broader community," DDA Executive Director Harry Burkholder said. "After several years of discussion, debate, and public engagement, the plan amends and extends the original TIF-97 Plan while establishing a long-term strategy for investing in the public infrastructure and services that support our community."
Mayor Amy Shamroe said that city officials have had many conversations with citizens about this issue and the people definitely had a voice in the plan that was approved Friday.
What it proposes to do is focus more on the service and upkeep of downtown, rather than on new projects, Shamroe said.
“It's really focused on streets, sidewalks, utilities, storm water," Burkholder agreed. "The things that make our community work is what our focus will be."
By Burkholder's recommendation, the plan involves a shorter extension of 20, instead of 30, years.
It also includes a revised revenue sharing formula that would refund 30% of the DDA’s estimated $4.5 million in annual tax revenue back to the local taxing units that provide TIF funding, including the city’s general fund, Grand Traverse County, Northwestern Michigan College, the Bay Area Transportation Authority and others.
The remaining 70% would stay with the DDA, and include an annual 4% appropriation of TIF funds, evenly split between downtown infrastructure and maintenance projects and additional stormwater management measures downtown.
The 70-30 split would return an estimated $38 million to local tax units over the next 20 years, according to Burkholder, including some $17 million to the city’s general fund.
Burkholder said the feedback he’s received from the community — and from the city commission — is that “there needs to be some kind of a share-back with the taxing jurisdictions” and that they also favored the reduction from the 30-year length of the current TIF plan.
“I’ve heard that loud and clear from the community,” Burkholder said. “It’s essentially giving (30%) of our revenue back to the taxing jurisdictions and I think that’s a compelling story, because that’s money back to BATA for public transportation, it’s money back to the seniors, it’s money back to the county at a pretty substantial number, but also providing enough funding for the DDA to still tackle the day-to-day core maintenance we’ve talked about and these infrastructure projects.”
TIF is the only municipal revenue-sharing tool available in Michigan that uses tax revenue collected from regional tax entities, such as Grand Traverse County, to fund public infrastructure and services in the city.
While Traverse City’s population hovers around 16,000 people, roughly 30,000 to 50,000 of people from throughout the region come into or pass through the city each day, along with millions of annual visitors.
This influx of people places tremendous stress on city infrastructure, DDA officials said.
