Redevelopment agencies have received a substantial amount of attention over the last decade. Notable projects, such as the Cottonwood Mall renovation and the Geneva Steel redevelopment, have brought to light how communities use RDAs.
Examples of how several Northern Utah Cities have used RDAs and tax increment to facilitate projects include: Layton's old downtown and the East Gate Business Park, The Junction in Ogden and Station Park in Farmington. They represent development that would not have happened but for the assistance of local governments using RDAs.
RDAs are allowed and regulated by the state of Utah. The state has strict policies regarding how RDAs operate and what RDA funds can be used for. An RDA represents a significant role for allowing municipalities to further economic growth initiatives.
For city's that have an RDA, a trustee board consisting of its respective city council governs the proceedings of the agency.
Redevelopment agencies have the authority, working with other taxing entities and private landowners, to designate certain geographic areas to generate tax increment.
This tax increment gives an RDA a funding source from existing taxes being paid. The financial support from this resource is important for communities as they generate and execute their respective economic development-related plans.
Communities may decide to use the tax increment revenue source for a wide variety of purposes.
Beginning with infrastructure, one can understand the importance of upgrading in a redevelopment process. Infrastructure costs can be substantial for companies looking to open a new facility, or for a new business park looking to attract tenants.
Roads, sewer and water lines, along with other costs ,represent a significant "barrier to entry" for those looking to build new facilities. RDAs can help to offset some of these costs.
By installing infrastructure, which serves an entire area, a city can offset costs for all who choose to locate in that area instead of just one company. This can be accomplished in lieu of providing direct monetary incentives.
Job recruitment initiatives can also be looked at for increment spending. They can include marketing, planning and economic studies and other measures that can facilitate economic growth.
Local incentives in recruiting new business can be an instrumental investment and have become a standard part of the business recruitment process. Incentives serve to "bridge the gap" to ensure that relocating or expanding makes fiscal sense for a company.
RDAs and cities must be very cautious about how incentives are used; otherwise, once they have started giving incentives the private sector will come to rely on them and won't consider a community otherwise.
Beautification projects are a vital improvement consideration, and housing cannot be ignored.
Steve Curtis has worked as a business consultant and communication specialist. He is mayor of Layton. He can be reached at email@example.com.