City TIDs get annual checkup from joint review board
The city of Medford is on pace to be TID-free within the next 10 years.
Tax incremental districts (TIDs) are a development tool where municipalities can use taxes paid on improvements to pay for the cost of installing streets, utilities and other expenses related to the development. The taxes that would normally go to overlying taxing districts such as schools, the county and the technical college are kept by the city to pay for the TID projects outlined in the project plan. The plan is approved by a joint review board made up of representatives from each of the overlying taxing districts. The board meets annually to review the health of the TIDs and met on Oct. 29 with Brian Reilly from Ehlers Associates.
The city has used TIDs extensively in the past typically on a project-specific basis. At one time they had 13 active TIDs, however several have since been closed and there are currently eight active TIDs in the city.
According to Reilly, all of the city’s TIDs are beyond their expenditure time periods and are in their repayment phase. The last project that was approved was a new water tower and sewer interceptor as part of TID 13.
The open city TIDs are: TID 5 — This was created in 1989 and is set to close by 2027. Its lifespan was increased due to it being designated a donor district to help pay off expenses in TID 8.
TID 6 — It was created in 1997 and is located in the industrial park and included the second city water tower by the fire hall. The TID is considered distressed and receives funds from other districts to pay off its debts. At the rate of repayment it is projected to be able to close by 2022-2023.
TID 8 — It was created in 1997 and is located on the east side of Skyline Drive. All the debts have been paid off with it currently paying off advances from the city general fund. It is scheduled to be able to be closed in 2022.
TID 10 — It was created in 1999 and includes Hwy 13 from Scheirl Tire to about Perkins St. including WIGM/ WKEB’s complex and Bone and Joint Clinic. It is currently in the period of repaying advances from the general fund and is scheduled to close by 2031.
TID 11 — It was created in 1999 and includes from North Main St. to Allman Ave. It is a donor district to TIDs 6 and 8 and is scheduled to close when TID 6 closes.
TID 12 - This was created in 2000 and includes the Marathon Cheese facility as well as the industrial park property south of CTH O. This TID is on track to repay its outstanding debts and is a donor district for TID 8.
TID 13 — This was created in 2005 and includes the Hwy 13 corridor from Hwy 64 to the north including the Walmart property. It is a mixed-use district and has a 20 year unextended life. It is projected to pay off its debts, but it was noted that cash flow is “tight.”
Under state law, a municipality can only have up to 12% of its value in TIDs. The city is above that level and is unable to create any new TIDs until others are closed. “We are essentially TIFed out,” Reilly said.
He said it would take the closure of either TID 12 or 13 to really bring the city under the maximum.
School district representative Dave Fleegel noted TIDs have been a good tool to have and questioned if there was any advantage to closing them sooner rather than waiting until their lifespan expires.
Reilly responded that during their expenditure period it is good to keep them open but outside the expenditure period, they should look toward retiring the liabilities and closing the districts when possible.