Agenda - 10-19-2004-7b - Laserfiche WebLink

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r r ,~ ~:. u ~=~,~_ ,~ ~. I ~ ,4 ,..~, , ~, BY AMNA CAMERON, FISCAL POLICY ANALYST 3 Executive Project Development Financing (often called "Tax-Increment Summary Financing") is an economic development tool that allows local governments to issue tax-backed debt without voter approval.. The plan is financed by allocating increases in property tax revenues within a designated area to pay off the debt, typically in 10 to 25 years. • For the third time, North Carolina voters will decide the fate of project development financing. Two prior attempts, in 1982 and in 1993, failed overwhelmingly at the polls by a vote of 77.5 percent and 72.8 percent, respectively. • Proponents of this initiative argue that local governments in North Carolina need this additional financing tool in order to fund public improvements that will bring economic development to areas that need it the most and at the least possible cost to taxpayers, . Though not without important strengths, the proposed amendment and the authorizing legislation have several critical omissions, such as the exclusion of information necessary to evaluate projects. In addition, the potential impact to housing, schools, and local government services are largely unstudied in North Carolina and common safeguards to prevent negative impacts on services or the surrounding community are not included. Overview n November 2nd, voters will be handed a ballot to elect oindividuals to local, state, and federal ofFces. This year the ballot will also include a constitutional amendment that could lead to a fundamental change in the way loco/ governments can finance debt. If approved by a majority of voters, local governments would then be BC BOOGET & TA% CENTER • BTC RFOORT4 7 Eleven Year Itch Strikes Again. Should "Self-Financing Bonds" Pass in its Third Attempt for Voter Approval?