The appeal of tax increment financing is clear. Public sector investments can be made off the balance sheet,
meaning citizens don’t feel the pain. And, when executed properly, the new revenue would not have otherwise
existed anyway and brings ancillary revenue benefits that results in a net gain for the public.
But there’s the trick. Getting TIFs right depends heavily on getting the analysis right. In jurisdictions around the
country, there are concerns that the incentives can become unnecessary giveaways, primarily due to
inadequate policies, procedures and analysis. There are also concerns about withering competition among
local jurisdictions and about whether TIFs are being used strategically.
Because some of these concerns have arisen in Utah, Utah Foundation has launched a series of reports on
economic development incentives at the state and local levels. And because local-level incentives are being
addressed in the current legislative session, Utah Foundation has just released a primer on local incentives
called Public Funds, Private Endeavors — a neutral report on how the incentives work and the debates
surrounding them. It’s critical for the public to understand these incentives because TIFs typically represent a
unique use of public funds to support private endeavors.