Planners, architects and developers have long been masters of the visual. It’s difficult to deny the power of a colorful drawing to communicate design, use and how changes to the landscape can improve the spirit of a place; projecting the image on a large scale can further amplify this kind of communication.
The financial mechanics that underlie any plan are not only more difficult to convey in a physical sense – they also place a presenter in jeopardy of alienating and boring an audience. Still, an understanding of how master plans and site plans will be financed, and how their development will affect the larger financial health of a community, are critical issues that require public discussion before moving ahead. Full understanding of these issues by key members of your audience will streamline your process and align expectations with reality.
Tax increment financing (“TIF”) districts are a redevelopment tool employed in every U.S. state except Arizona. While publicized abuses have tarnished the political image of this tool, it remains a critical mechanism, trapping incremental property tax revenue from redevelopment for repayment of the debt used to finance the improvements in the first place. Structuring a TIF district requires a discussion of variables ranging from the state’s tax treatment of different types of property to the post-redevelopment value of parcels, projected appreciation rates, absorption of redeveloped space into the market, and the cost of capital. See the eyes of the audience glazing over?
The Donjek InstanTIF decision tool allows audiences to engage TIF in an interactive way thanks to a number of attributes. The tool:
• Allows a presenter to show the various parcels in a proposed TIF district as a map on a screen, with colors to reflect assumptions about appreciation in the future.
• Illustrates the essential items for calculations, allowing a presenter to convey more detail if desired.
• Gives members of an audience real-time feedback about how changes to one or more variables would change TIF cash flows and consequently the amount of borrowing the district can sustain.
• Can be presented in tandem with graphic data layered through GIS software, to illustrate demographic and market trends of significance.
The InstanTIF tool is custom tailored for each proposed TIF district. Moving forward, consider this decision tool for future discussions with investors, public officials or community members, and extend the communicative power of pictures to project finance.
InstanTIF software design, text, graphics, and mechanics are Copyright 2007 by Jon Commers. ALL RIGHTS RESERVED. Any use of this software, including reproduction, modification, distribution or republication, without the prior written consent of Jon Commers, is strictly prohibited.