TIF District Value Calculator

TIF uses incremental tax revenue to finance eligible public/private projects.

Pre-TIF assessed value

Post-development value

Mill rate / 1000

TIF capture %

TIF years

Discount rate %

PV of TIF proceeds

$6,729,944

Annual increment

$577,500

Total undiscounted proceeds

$14,437,500

How the math works

Increment = post − pre. Annual = increment × mill × capture %. PV = annuity.

$35M × 22/1000 × 75% = $577,500/yr. × 25 years annuity at 7% = $6.74M PV.

How to Use

Enter pre-TIF assessed value.
Enter post-development assessed value.
Enter mill rate / 1000.
Enter TIF capture %.
Enter TIF district years.
Read PV of TIF proceeds.

Frequently Asked Questions

What is TIF?

Tax Increment Financing. When property values rise in a designated TIF district, the incremental property tax (increment) is diverted from general fund to finance eligible district projects. Typical term: 20-35 years. Common for brownfield redevelopment, downtown revitalization, affordable housing, infrastructure. Funded via bonds issued against future increment (pay-as-you-go) or direct reimbursement for eligible developer costs.

Typical capture rates?

TIF captures 60-100% of incremental property tax. School district portion often excluded (protected). General fund + county portions typically captured. Some states cap at 50-75%. Negotiate early in district designation; locked in through district life. Over 20-30 year district, captured increment = 30-60% of project value for some high-value redevelopments.

Eligible costs?

Site acquisition, demolition, environmental remediation, site preparation. Public infrastructure (water/sewer, roads, sidewalks, parking). Some states: building rehabilitation, affordable housing units. Other states: limited to public/infrastructure only. Compare state rules. Developer can often receive TIF proceeds as reimbursement for eligible costs incurred — powerful financing tool.

Risks?

TIF proceeds depend on property value appreciation. Downturn = reduced proceeds. Some TIF districts have fallen short of projections (Detroit, parts of Chicago). Bonds backed by projected increment can default if values decline. Sponsor often retains exposure to shortfall. Stress test with conservative appreciation assumptions. Some TIF has guaranteed minimum from city to reduce sponsor risk.