ELKINS, W.Va. (WBOY) — The City of Elkins’ Tax Increment Financing (TIF) district application was approved, the City Council learned Thursday night.
According to a press release from the City of Elkins, that means that the city was granted permission from the West Virginia Department of Economic Development to establish the proposed TIF district.
Next, the council has to approve an ordinance to enact the TIF district. The city said that officials are meeting soon to plan next steps, and that the process of doing so will likely take about 30 days.
TIF is a mechanism in West Virginia state law that helps cities and counties pay for necessary projects by reserving future increases in property tax revenues for local use when other finances are not available.
The city could use municipal bonds, or a pay-as-you-go process to issue TIF funds, but has not decided which method to use yet, according to the release. Bond financing for Elkins can not exceed $25 million.
No one pays higher taxes as a result of TIF. School system revenues are unaffected by the TIF, because they are protected by the state School Aid Formula. The $25 million figure is based on a projection of what the property tax revenue increases in the district might amount to over the next 30 years. Although this sounds like a large sum, it is important to keep it in perspective and remember the timeframe. If Randolph County’s revenues—just estimated for Fiscal Year 2024 at $12,639,190—were to remain flat for the next 30 years, the county’s full income during that period would be about $380 million. The projected $25 million revenue for the city would be less than seven percent of this amount, and it seems reasonable to expect that the county’s revenues will not remain flat for the next 30 years. Indeed, we are confident that the TIF district itself will help fuel increased revenues over the next 30 years at the county level as well.City of Elkins press release
The city estimates that the TIF will increase business activity and fuel economic growth.