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EDA debates adding TIFF and tax-abatement options to business subsidies; tables final abatement decision pending county and school input
Summary
Board members discussed whether to add tax-increment financing (TIFF) or tax abatement to the city’s business-subsidy toolkit and reviewed the 280 fund that supports abatements; usage has declined (board cited '23 properties down to eight'), and members agreed to contact the county and school district before deciding whether to extend abatements.
A prospective large business requested incentives beyond what DEED or the city’s enterprise-zone incentives could offer, prompting the East Grand Forks EDA on March 18 to consider expanding its business-subsidy toolkit to include tax-increment financing (TIFF) or tax abatement.
Staff said TIFF or abatement are not currently included as options in the city’s business subsidies agreement and that expanding the policy would require loan-committee review and eventual city-council approval. One board member supported adding TIFF for community-benefit projects, while others expressed concern that short-term two-year abatements typically help higher-priced builds and may not directly assist local workers who cannot afford $500,000-plus homes.
Board members cited internal metrics that usage has trended downward—"23 properties down to eight" in recent years—and noted that abatement approvals require buy-in from both the county and the school district, which would share some cost impacts. The board agreed to contact the county and school district to confirm continued participation and then present clearer alternative incentive options (down-payment assistance, loan programs) for a future decision; the item was tabled pending that outreach.
What happens next: staff will contact county and school-district officials to determine whether they remain willing to participate in abatement approvals, assemble alternative incentive models for board review, and bring the item back to a future meeting.
