What is the “but for” test?

A municipality is required to find that, but for the designation of the TIF district and the use of Tax Increment Financing, it is unlikely that significant investment will occur in the Redevelopment Area. Without the support of public resources, the redevelopment objectives for the redevelopment project area would most likely not be realized. The area-wide improvements and development assistance resources needed to redevelop and revitalize the redevelopment area are extensive and costly, and the private market, on its own, has shown little ability to absorb these costs. Excessive vacancy throughout the area demonstrates that the private market has been unwilling to invest in these properties. Public resources to assist with site preparation and public infrastructure improvements are needed to leverage private investment and facilitate area-wide redevelopment. TIF funds can be used to support building rehabilitation, utility and infrastructure improvements, site assembly and preparation, and environmental remediation. Accordingly, but for the designation of a TIF district, these projects, which will contribute substantially to area-wide redevelopment, are unlikely to occur. 

Show All Answers

1. What is a Tax Increment Financing District?
2. What is a "tax increment"?
3. Does TIF result in increased tax rates?
4. What is the “but for” test?
5. How is a TIF district created?
6. What costs are eligible for TIF funding?
7. Who monitors the TIF process?
8. How long is the area designated as a TIF district?
9. Does TIF divert money from schools?
10. What happened during Geneva’s previous TIF district?