TIF is a mechanism that helps fund public improvements related to economic development such as parking facilities, roadways and other public infrastructure. According to Maryland law, when a development or redevelopment project is going to create additional tax revenues for a jurisdiction, that jurisdiction can in certain cases issue bonds to pay for public improvements for related infrastructure-such as roads, parking, and stormwater management-and can finance those bonds through the incremental increase in revenue that the project will generate. Please call 301-583-4650 and ask to speak with a Business Development Specialist for more information.
When using a TIF to incentivize a project, the county delineates a project area and declares a “base” year. The base-year’s assessed valuation for the area is taxed as before. However, the tax revenues from any incrementally higher assessed value above the base that is attributable to the new project will be remitted to a special fund and used to pay debt services for identified improvements.
The uses of TIF financing by Maryland’s local governments is usually restricted by state law. However, a recent change in state legislation broadened the permitted uses of TIFs, so that the county was able to pre-designate certain areas as pre-qualified and eligible for the use of TIFs for development projects. These areas are the “TIF Districts,” and projects within them have increased certainty that they will be approved for a TIF bond, though they will still need to negotiate exact terms with the county.
For more information, contact the Economic Development Corporation at 301-583-4650 and ask to speak with a Business Development Specialist.