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City Struggles with "Double Edged Sword" of TIFs and Taxes

March 21, 2018 - 9:53 am

ST. LOUIS (KMOX) - With the city facing up to a $17 million deficit again, Aldermen are reacting to a new report that shows the tax breaks to developers are costing the city $30 million a year.

 

The report from the Comptroller’s office says the $30 million in tax breaks takes away money that would otherwise go to police, firefighters, schools, public libraries, and cultural institutions like the zoo and art museum.

Dogtown Alderman Scott Ogilvie was asked if it was time for TIF moratorium.

“No, because St. Louis is an incredibly weak real estate market, and if you remove the incentives there will be dramatically less construction activity,” he says.

Ogilvie says there are projects all over the city--including new housing construction--that would not have been built without TIFs. Central West End Alderwoman Heather Navarro says you have to look at both sides of tax increment financing.

“We need to look at how much revenue we’ve been able to bring in as a result of those incentives, and I don’t know that right now. I would want to know what we’ve seen in terms of revenue on the other side,” she says.

Aldermen are looking at alternatives to TIFs, giving developers a promise of no tax hikes for ten years, if they pay the full amount.  Alderman Frank Williamson is Chairman of the Aldermanic Budget Committee says money is tight, but they need TIFs to bring in the funds, calling it a "double edged sword."

Williams says you have to give a little to get a little, and the city is getting developments that will eventually pay full taxes.