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BPF backs TIF
Published: 2009-07-02 14:32:18
The early introduction of tax increment financing (TIF)to kick-start regeneration schemes is one of the five core proposals of the British Property Federation’s (BPF’s) recently-launched “Regeneration Manifesto”.
Under the BPF’s proposal, backed by several large local authorities, TIF would only be employed for schemes that would otherwise be unviable. The government is being urged to allow councils to use TIF to borrow against predicted increases in both property and business tax revenues as areas improve through regeneration.
The TIF model was first introduced in the US in the 1950s and has been used in most states since. It is widely credited as helping the regeneration of large parts of Chicago, among other cities.
Chairman of the BPF’s regeneration committee, Ken Dytor, backed TIF because “no one expects councils to conjure up money they don’t have, which is why we are looking at making the best of what we’ve got through a number of innovations”.
Barry Allen, head of Savills Birmingham office, described TIF as “a potentially important route to unlocking the biggest projects, those that are necessarily capital-hungry upfront and have consequent imbalances in cash flows”. Local authorities signed up to the BPF manifesto include Liverpool, Manchester, Newcastle and Birmingham.