Wednesday, April 2, 2014 - 12:59pm
Legislation will allow Madison to use Tax Incremental Financing for Parking Structures
After Assembly passage in February, the State Senate today passed legislation which addresses an unintentional limitation on the City of Madison’s use of Tax Incremental Financing (TIF). The legislation was introduced by Representatives Dale Kooyenga and Robb Kahl and Senator Tom Tiffany.
"Madison alone faces an arbitrary and unintended limitation, and I am grateful for the time and effort that Representatives Kooyenga and Kahl invested in fixing this. I also want to extend my appreciation to Senator Tiffany for his sponsorship and work in the Senate," said Madison Mayor Paul Soglin.
TIF is a mechanism used by municipalities to fund infrastructure and promote economic development. In 1981, the Wisconsin Legislature passed a law intended to prohibit using TIF for large-scale water and sewer projects. The language of the 1981 statute, however, swept more broadly. It prohibited using TIF for any project where a municipality has traditionally used utility user fees. Since Madison has had a parking utility since the 1940’s, the city has been unable to use TIF for parking structures. This was not the intent of the law.
The city owns five parking structures on valuable downtown real estate. The oldest was built in the 1950’s and needs to be replaced. "These structures will be replaced in a much different economic environment than when they were built in the late 50’s to early 80’s. In the very early 90’s, before construction of the Terrace, the Capitol Square was roughly 50% vacant. Since 1995, Downtown property values have increased 2.5 times as fast as the rest of the city. The land has become more valuable and the need for parking more pronounced," explained Mayor Soglin.
"Parking serves as an essential tool in economic development, particularly for development projects that support jobs," the Mayor continued, "While this is a small change in the law, the benefits could be great, and they won’t be limited to our municipal boundaries. Construction jobs come from all over the state, and the economic development will benefit the state’s economy," said Mayor Soglin.
"The legislature has passed a true economic development bill, and I look forward to the governor signing it," the Mayor concluded.
- Nick Zavos608-266-4611