TIF Just Another Way Of Saying Corporate Welfare

Posted by on Jul 04 2011 | cato institute, Corporate Welfare, Economy, PPC

In Sunday’s Denver Post perspective page, Independence Institute senior fellow Randal O’Toole explains that using Tax Increment Financing (TIF) subsidies to finance private-sector development is really just a form of corporate welfare, and uses the proposed TIF financed Gaylord Entertainment hotel and conference center deal in Aurora as an example of “…the mania that has led to a nationwide glut in convention centers with urban-renewal tax subsidies that are eating holes in the budgets of school districts, fire departments, and other vital services.”

Writes Randal:

Once some developments are subsidized, developers will refuse to build anything else unless they, too, are subsidized. Urban-renewal subsidies thus become a vicious circle. That’s a major reason TIF is one of the fastest- growing parts of government, increasing an average of 10 percent per year in many states. In California, which invented TIF in 1952, urban-renewal districts are collecting about $160 a year for every resident of the state.

Read the whole thing here. And also check out Randal’s recent Cato Institute Policy Analysis on the issue, “Crony-Capitalism and Social Engineering: The Case against Tax Increment Financing.”

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