Lengthening the time during which tax increments may be allocated and expenditures for project costs may be made for Tax Incremental District Number 3 in the city of Middleton. (FE)

Once a TID has been created, the Department of Revenue (DOR) calculates the "tax incremental base" value of the TID, which is the equalized value of all taxable property within the TID at the time of its creation. If the development in the TID increases the value of the property in the TID above the base value, a "value increment" is created. That portion of the property taxes collected from the TID that is attributable to the value increment is called a "tax increment." The tax increment is placed in a special fund that may be used only to pay back the project costs of the TID. The project costs of a TID, which are initially incurred by the creating city or village, include public works such as sewers, streets, and lighting systems; financing costs; site preparation costs; and professional service costs.

DOR authorizes the allocation of the tax increments until the TID terminates or, generally, 20 years, 23 years, or 27 years after the TID is created, depending on the type of TID and the year in which it was created. Also under current law, a city or village may not generally make expenditures for project costs later than five years before the unextended termination date of the TID. Under certain circumstances, the life of the TID, the expenditure period, and the allocation period may be extended.

Under this bill, with regard to Tax Incremental District Number 3 in the city of Middleton, the expenditures for project costs may be made for up to 42 years after the TID was created, the Department of Revenue may allocate tax increments for up to 47 years after the TID's creation, and the maximum life of the TID is extended for ten years.