All of Victoria, MN

Tax Increment Financing

Tax increment financing, often called TIF, is a financial tool cities may use to assist development, which otherwise would not occur but for the use of tax increment assistance. The purpose of TIF is to create jobs, provide affordable housing, redevelop declining areas or clean up environmentally contaminated sites.

TIF may also be used to finance public infrastructure — such as streets, sewer, water or parking facilities — that is related to the development. In some cases, the developer would be required to pay for this infrastructure through special assessments or other charges. In other cases, all taxpayers would pay through general city taxes.

The City's Business Subsidy Policy outlines the criteria that the City Council considers in a request for TIF or assistance for new development. 

How does TIF work? 
When a city creates a TIF district, the assessed property values in that district are "frozen" at their current level. As development occurs and property values rise, the city captures the increased local property taxes (city, county, school, and special taxing jurisdictions) to pay for any public improvements or to help finance development and redevelopment projects. State property taxes and referendum taxes are not captured within TIF.

Do Victoria residents pay taxes that are used by a TIF project? 
No. Taxes paid by a development continue to be directed in the same manner. Residents do not pay taxes that are used by a TIF project. Only new dollars created by the project can be used to assist the project. In some cases, existing taxpayers may be relieved of financial burdens if additional public improvements are financed with the increment created by a project. 

What can TIF funds be used for? 
TIF funds can only be used for land acquisition and physical improvements, such as infrastructure, buying land or demolishing buildings. TIF funds cannot be used for loans to businesses for working capital, machinery or equipment. 

What is a TIF plan? 
A TIF plan is a planning document, which describes why the area is eligible to be a TIF district and describes the proposed projects and activities. The TIF plan also includes the estimated tax increments to be generated and the proposed use of the tax increments. Specific terms for assistance to a private developer are not included in the TIF plan; these terms are part of a separate development assistance contract known as a TIF agreement. 

Tax Increment Financing Districts Resources Existing Tax Increment Financing Districts
A Tax Increment Financing Districts PDF Map is available as well as an interactive Tax Increment Financing Districts Layer on a GIS map. Learn more about existing Tax Increment Financing Districts within our community below.

City_Victoria_Department_Economic_Development City of Victoria Community & Economic Development Department
Guidance to residents and businesses to ensure that development is consistent with the City’s zoning regulations and its comprehensive plan vision for our community is provided by the City of Victoria Community & Economic Development Department.

List of Tax Increment Financing Districts
Tax Increment Financing District 1
Tax Increment Financing District 2
Tax Increment Financing District 3
Tax Increment Financing District 4
Tax Increment Financing District 5
Tax Increment Financing District 6
Tax Increment Financing District 7
Tax Increment Financing District 8