By Kevin Wilson
Special to The Globe
NEOSHO, Mo. —
What the heck does CID, TDD, TIF and EIEIO mean and why should you care? Well, CID stands for Community Improvement District, TDD is a Transportation Development District, TIF is a Tax Increment Financing district and EIEIO is the refrain from “Old McDonald Had a Farm.”
The first three have been reported on prominently in the news for the past several months, and the last one I just threw in to see if you were paying attention.
Why should you care about any of these? For one thing, they can have a huge impact on economic development, and for another, they have become a political hot potato in the cities of Neosho and Joplin. The intention of my column is not to make a judgment on the value of these programs or to take sides in any controversy that stems from their proposed usage. My purpose in writing this column is merely to inform you as to what they are, so you can follow the discussions and come to your own conclusions as to their benefit.
All three of these programs fall under the guidance and direction of the Missouri Department of Economic Development and are used throughout the state. I used the DED website to do the research on each of these programs, so if you want additional information and have access to a computer you can go to www.ded.mo.gov.
A CID may be either a political subdivision or a not-for-profit corporation, and is organized by the property owners themselves for the purpose of financing public-use amenities. A CID is a legal entity all its own, but it has to be created by ordinance of the municipality where it is located.
The website lists several physical projects and public services that can be funded from the CID, which includes what you would normally see in a community — convention centers, parks, street improvements, parking lots, bus services and a whole lot more. Funding for the CID can be through fees and charges to use the property or services or, if organized as a political subdivision, through property and sales taxes.
A TDD is created to develop, improve, maintain or operate projects related to transportation needs within the area of the district. A TDD is created by a request petition filed in the circuit court of any county that has any portion of the proposed TDD. Projects may include streets, roads, bridges, stoplights and almost anything you can think of — even an airport, if it has to do with transportation.
Transportation districts are funded through special assessments or taxes (property or sales) within the district and/or tolls, and fees for the use of the project. If the project is not part of the Missouri highway system, then a local transportation authority becomes the owner of the project. A local transportation authority can be any public authority or political subdivision having jurisdiction over the transportation system in which the TDD is located.
A TIF district uses a portion of local property and sales taxes to help fund the redevelopment of certain areas in a community. The areas must contain property designated as “blighted,” “conservation” or an “economic development” area, or any combination thereof. TIFs have to be established by the governing body of a municipality, which is defined in state statutes as an incorporated city, town, village or county. Revenue from the TIF may be used to pay certain costs associated with a redevelopment project, including professional fees, land acquisition, rehabilitating/repairing existing buildings, etc.
The first two programs (CIDs and TDDs) are usually funded with additional revenues, while TIFs take existing taxes and use it toward redevelopment. The thought here is that the redevelopment will result in additional revenue to replace, and hopefully increase, the tax dollars that are spent on projects within the TIF. In the case of a TIF district, publicly supported entities such as school districts can be adversely affected by the loss of operating dollars while the TIF is in effect (up to 23 years).
I almost have a headache from trying to sort through this alphabet soup of government-authorized community financing programs. I know I haven’t provided you with a great depth of information, but I hope I have given you enough knowledge to be able to have an understanding of what is being discussed in the media and in your city hall.
Kevin Wilson lives in Neosho. He is a former Missouri legislator.