ELKINS, W.Va. (WBOY) — Earlier this month, the Elkins City Council voted to apply to the West Virginia Department of Economic Development for authority to form a Tax Increment Financing (TIF) district.
According to the city’s External Affairs Specialist, a 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 method allows cities and counties to avoid needing to increase property-tax rates.
The only projects that can be funded by the TIF are those for which no other source of funding is available, according to External Affairs.
There are still several steps remaining in the process of creating the TIF:
- The West Virginia Department of Economic Development must review the application. A response is expected some time in March.
- If the application is approved, the city must approve an ordinance to create the TIF. According to External Affairs, that could happen by early April.
- The city must also decide if it wants to pay for TIF projects using bonds or a pay-as-you-go method.
Issuing bonds would require separate council approval, along with justification of financial need and anticipated revenue collection, according to External Affairs.