Waunakee's TIF Policy

Introduction

The following guidelines have been created and adopted by the Village of Waunakee to help direct and evaluate requests for financial assistance through any one of the existing and active TIF districts or future districts. The purpose of this policy is to provide guidelines regarding the Village’s use of Tax Increment Financing (TIF) for business development incentive purposes.

The goal of the Village’s use of TIF is to diversify its economic base through the retention and expansion of existing businesses, the redevelopment of the areas that are blighted or in need of redevelopment, the attraction of new industrial users and employment centers, and other projects of special community interest. These goals will help to establish new employment opportunities for Village residents and expand the tax base.

These guidelines are intended to provide general direction on the creation of TIF districts and the use of TIF funds. The Village recognizes that each development area and project is unique and should be considered on a case-by-case basis. The Village Board may choose to deviate from these guidelines if appropriate for projects of special economic or community interest.

Types of TIF Assistance

Traditional TIF Assistance – Traditional TIF assistance may take the form of direct cash assistance for projects that will result in a development increment. In such cases that Village would use existing funds or newly borrowed proceeds.

"Pay-as-you-go" TIF – The Village will use "pay-as-you-go" financing, also known as developer financing, as a method to help reduce the financial exposure of the Village. Under this financing method the developer pays the upfront costs of the project. The Village would provide a Municipal Revenue Obligation (MRO) to establish the criteria to fully or partially reimburse the developer using future tax increment. "Pay-as-you-go" is the preferred TIF financing mechanism of the Village Board.

Land – In lieu of or in combination with other incentives, the Village may assist development or redevelopment projects by providing Village-owned land to a developer at no cost or a reduced cost. 

 

Guidelines for TIF Financial Assistance for Private Development Projects

The following are general guidelines for evaluating requests for TIF funded development assistance for major projects:
 
Each project should demonstrate sufficient need for financial assistance. In accordance with State law, the Village will not provide TIF assistance unless the proponent can demonstrate that "but for" the use of TIF, the project could not proceed as proposed. The burden is on the requesting party to prove that the proposed project would not be feasible without Village assistance.

Every other financial alternative should be explored prior to the use of TIF, including equity participation, other federal and state funds, bonds, tax credits, loans, etc.

TIF assistance should be utilized as gap financing. The requesting party may be required to provide adequate financial records to demonstrate the financial gap. Examples of information that may be required would include: detailed Sources & Uses of funds, ten (10) years projections of revenues and expenses for leased properties, details on outside funding and equity. The Village may seek to independently corroborate the level of project profitability with and without TIF funding to assure that the returns are within the ranges of the norm for the market.

TIF assistance should be limited to the amount necessary to make a project competitive with other similar projects in the Waunakee market area.

Each project should demonstrate probability of economic success.

TIF should not be used to pay for public infrastructure expenditures that are paid by special assessments or other Village charges. Non-assessable public infrastructure expenditures may be funded with TIF.

Any recipient of TIF assistance will be asked to provide a guarantee or security in a form satisfactory to the Village that the project will be developed as proposed.

Where feasible, TIF assistance should be in the form of "pay-as-you-go" TIF assistance.

All TIF assisted projects shall be consistent with the goals, objectives, and policies of the Village of Waunakee Comprehensive Plan and the individual Tax Increment District Project Plan.

Implementation

 
The Village Administrator / Economic Development Director shall be responsible for implementing this economic development policy, and will lead in facilitating development projects and coordinating efforts with the private sector. As development projects arise, the Administrator / Economic Development Director shall inform the Village Board of the project details and request for assistance. The Village Board is responsible for granting authority to negotiate the types and levels of development incentives with the potential project developers. The Village Board shall have the final authority to review and approve all negotiated agreements in accordance with Wisconsin State Statutes. Meeting statutory requirements, policy guidelines or other criteria listed herein does not guarantee the provision of TIF financial assistance nor does the approval or denial of one project set precedent for approval or denial of another project.