It's time for the public to be informed on why developers seek TIF contributions.
* A party can't obtain a loan for demolishing a structure because there would be no collateral. The party would have to put up cash or provide another source of security to the lender.
* A party can't obtain a loan for offsite construction such as the new entrance for Eckerts required by the state. A lender would have an unsecured loan because it couldn't place a lien on property owned by a government entity. Offsite construction typically is required to be paid for in cash by the developer.
* A party needs to correct underground unstable soil conditions such as undermined areas. The cost of correcting these conditions is usually deducted from the appraised value of the land, which results in the developer's loan proceeds being reduced. This requires the party to put up more upfront cash.
While the public must have a down payment (usually cash) to get a loan for a car or house, these types of TIF's permit the developer to obtain financing with limited cash investment.
If the city wants to invite and promote development, all it has to do is provide property tax abatement to a developer, in which case property taxes are frozen for a specific period of time. This procedure provides the developer with an incentive.
Additionally, if Belleville wants to maintain the quality of its housing stock, they should offer tax abatement to property owners for upgrading their property.