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S.F. No. 3433 - TIF; Clarifying Permitted Use of Certain Increments
Author: Senator Ann H. Rest
Prepared By: Eric S. Silvia, Senate Counsel (651/296-1771)
Date: April 7, 2016


S.F. 3433 clarifies the permitted use of certain tax increment by providing a technical and clarifying change to the so-called six-year rule.  The six-year rule provides that in the sixth year (and each year following) certification of a tax increment financing district, if the in-district percentage of the tax increment received from the county in that year exceeds the costs spent on in-district obligations in that year, the excess must be used only to pay bonds issued during the five-year rule, pay binding contracts with a third party, reimburse developer or owner for costs incurred, or to decertify the district.

Effective for districts for which the request for certification was made after April 30, 1990, for increments used after December 31, 2015.



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