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Finance 101: Tax Increment Financing

by Robby Hammond, Hillsboro City Manager

Post Date:02/29/2024

Robby Hammond headshot Why is Hillsboro ranked a Top 50 Best Place to Live in the United States year after year?

The reasons start with the community’s goals of having a strong and resilient economy, a variety of housing options, and amenities that provide a high quality of life. Gordon Faber Recreation Complex (GFRC), Ronler Acres Fire Station, and Hondo Dog Park are all examples.

These are also some of the community assets made possible by the City’s use of Tax Increment Financing, or TIF, which is also known as Urban Renewal.

TIF is a financing tool that a city can use to generate revenue to thoughtfully invest in infrastructure and projects that might not otherwise be completed.

TIF does not add to your taxes. Instead, it dedicates property tax revenue growth within specific areas to invest back into those areas. We do this to achieve community goals, such as creating economic opportunities, providing diverse housing options, award-winning parks, amenities, roads, infrastructure, and more without raising taxes.

Two areas in Hillsboro use Tax Increment Financing:

In the Downtown Hillsboro Urban Renewal Area, TIF has helped increase the vibrancy of the heart of our community through projects such as the 4th Main Apartments, Main Street Commons, investment in the Calle Diez/10th Avenue area, and Storefront and Tenant Improvement Grants. Much of the revitalization Downtown is experiencing today is supported by TIF funding.

Downtown Hillsboro

In the North Hillsboro Industrial Renewal Area, we’ve seen about $3.5 billion in new private industrial investments adding over $1.7 billion in new assessed value for property taxes, providing 1,234 jobs, and increasing the area’s economic value and vitality to attract future employers.

North Hillsboro

TIF funds are invested in needed infrastructure that brings in new businesses that help grow our local economy. The investment in these areas improves Hillsboro’s long-term financial health as the property tax base, over time, will help fund future City services for all Hillsboro residents.

Through this economic development, we can help pay for the services you enjoy each day, such as parks, libraries, streets, public safety, and more. This approach is not new, and it’s a big part of the Hillsboro we all know and love today. In the 1980s and 1990s, the Ronler Acres Urban Renewal Area helped create good-paying jobs. It also led to the TIF investments that produced Evergreen Parkway, Hondo Dog Park, GFRC & much more.

The Ronler Acres Urban Renewal District no longer exists because it achieved its goals and was closed out. Now, the taxes generated in that area are used for communitywide needs.

That will be true someday for the Downtown and North Hillsboro Urban Renewal Areas.