2021.07.27 WS Packet v.2 - Laserfiche WebLink

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,74 3. Fundamentals of Tax Increment Financing (TIF) V Delinquent Taxes for Existing Districts When property owners within a tax increment district pay their taxes late or not at all, it can affect a city's ability to pay outstanding obligations on time or require the city to find alternative temporary sources (such as an interfund loan) until those property taxes are paid. If there are delinquent taxes when a TIF district expires, the city can notify the county auditor when there are outstanding bonds or contractual obligations that will go unpaid or be paid by other sources. (M.S. 469.176 Subd. 1f.) In that case, the county will continue to send the delinquent tax increment to the city even after the district has expired. The county auditor may request information regarding the amount of outstanding obligations or other information necessary to administer the payment. Tax Court Petitions for Existing and Expired Districts When property owners within a tax increment financing district contest their prior years' values tax court, it can also affect a city's ability to pay obligations. Property owners can contest their values going back several years, which can result in negative tax increment after a district has been decertified. In the case where a decertified TIF district has negative tax increment as part of the County tax settlement, the City will need to find other sources if the TIF fund has been closed or there are insufficient cash balances available in the TIF Fund. 8