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S.F. No. 670 - TIF; Extending 5-year rule to 10 years
 
Author: Senator Ann H. Rest
 
Prepared By: Eric S. Silvia, Senate Counsel (651/296-1771)
 
Date: February 25, 2013



 

Section 1 extends the five-year rule to ten years for all districts certified after June 30, 2003. The five-year rule essentially requires that activities on which increment will be spent must be completed within a five-year period beginning with certification of the tax increment financing district’s original tax capacity. 

Section 2 modifies the year in which revenue must be used for determination to reflect the change made in section 1. Now, in each year beginning with the eleventh year (sixth year in current law) following certification of the district, increments may only be spent to pay bonds issues during the ten-year period, pay binding contracts with a third party, reimburse the developer or owner of property for costs incurred and to decertify the district by defeasing the bonds.

 

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