There is a lot of talk about the Town Center Tax Incremental Financing. Perhaps we should add some facts to the conversation.
Most Comparable Communities Use TIF Much More Extensively
The following list shows each community’s new development value in its Tax Incremental Districts (increment) as a percentage of its overall equalized values:
Menomonee Falls 7.45%
Oak Creek 5.97%
Elm Grove 2.89%
Whitefish Bay 1.78%
Source: Wisconsin Department of Revenue
Mequon has been exceedingly careful. That is the way we do things.
Mequon Does Not Give Money Up Front or Make Loans to Developers
Unlike many communities, under current policy, Mequon does not give money to developers before the developer performs. It has in the past made some small (in relationship to the value of the development) up front TIF payments, but no more. Giving money up front involves more risk on the part of the community, and requires much more stringent penalties for nonperformance.
Instead, Mequon has recently incentivized development in its TIDs on a pay-as-you-go basis. The developer only receives an incentive if it actually builds the project, meets its agreed upon value, and pays taxes on that value. No development, no value or no tax payment – no incentive. Plus, there are significant penalties if the developer does not do as promised.
Also, these incentives last for a limited time.
Mequon Only Gives Incentives to Redevelop Tired, Blighted or Contaminated Properties
Most of the property that has received incentives has been environmentally contaminated. All of it has had old, unproductive improvements that are expensive to remove. The contamination and old improvements kept the properties from being redeveloped. These properties did not redevelop before the incentives were offered. However, with the incentives, contaminated and blighted properties are being redeveloped with valuable, tax paying projects.
Mequon Does Not Pick and Choose Winners
With the exception of redevelopment of city-owned property, in which case the city by definition has to choose the developer, any applicant who meets the district’s redevelopment criteria has been eligible for incentives. This takes the ugly cronyism out of the process.
Mequon Has Always Been One of the Most Fiscally Conservative Communities
Mequon has been well-managed, ensuring that its tax rate stays low while still providing excellent safety services, well maintained roads, good facilities, parks and open spaces, a fine library and other services. And it has maintained one of the best, or the best, school systems in the area.
Mequon has maintained one of the lowest tax rates in the state by being careful in the way it spends money and by ensuring that it has diverse, high value properties that pay taxes.
The same people who have held the line on taxes are the people who have carefully approved these TIDs. If the city has done such a good job for the past 20 years, why would anyone assume that these decisions are not made with the same attention to detail and restraint?
I am proud to say that I have been on the front lines fighting to keep taxes low. Others who are running have just been critics.
As mayor, I will carry on this tradition of good, fiscally conservative government. After all, I have been part of it for most of the past 20 years. I will ensure that the existing TIDs provide tax relief for generations to come, keeping our tax rate low.