Local governments in Minnesota had $410 million of outstanding general obligation bond debt in 2010 related to tax-increment financing districts, according to a new analysis compiled by state auditor Rebecca Otto’s office.
A total of $1.7 billion in TIF financing was owed, but pay-as-you-go funding drawn from increased taxes generated within the district accounted for $780 million of that, while revenue-backed borrowing accounted for $210 million.
Local governments had a total of 1,897 TIF districts in 2010. The report does not assess the success of the TIF program aimed at improving blighted areas by freezing existing taxes within a district and then using any growth to fund improvements. TIF district growth has slowed with just 39 new ones established in 2010, down from 91 in 2006.