Staff explain how new residential TIFs would relate to Bloomington’s consolidated TIF and EDA

During the city’s public information meeting on proposed residential TIFs, a reporter asked whether parcels proposed for new residential TIFs are already inside the consolidated TIF and whether establishing a residential TIF would prevent consolidated TIF dollars already captured from being spent there.

Dana Kerr, the city attorney assigned to work with the redevelopment commission, answered that consolidated TIF funds can be used on projects that benefit the consolidated TIF. Kerr noted the city is already using consolidated funds for design work related to the residential TIF proposals.

Justin, a finance advisor from Reedy Financial who spoke during the meeting, explained the relationship between the Economic Development Area (EDA) and individual TIF allocation areas with a simple analogy: the EDA is the larger area where funds may be spent (the ‘pizza’) and the smaller allocation areas are the pieces that generate the revenues (the ‘pepperoni’). He said even though revenues are collected only from parcels within an allocation area, authorized spending can be applied across the broader EDA where permitted.

The exchange clarified that establishing a residential allocation area does not necessarily bar use of existing consolidated TIF funds for projects that benefit the consolidated EDA, but the details of specific expenditures would depend on whether the project can be shown to benefit the consolidated TIF area and on future RDC and council approvals.

The meeting materials and staff commentary did not list specific dollar amounts or a binding directive to transfer existing funds; staff said those decisions are subject to the usual RDC and Common Council processes.