Tax Incremental Finance (TIF) - Developer's Agreement

  1. What is the difference between a loan and a grant?

  2. Is the municipality required to send a copy of the developer's agreement to the Wisconsin Department of Revenue (DOR)?

  3. When must the public hearing notice include the cash grant reference? Is an amount required?

  4. Who makes the decision on what to include in a developer's agreement?

  1. What is the difference between a loan and a grant?

    Cash grant: when the municipality provides funds to an owner, developer, or lessee of land by a municipality using Tax Incremental District (TID) increments and the funds are not paid back.

    The project plan may also refer to a cash grant as a 'developer incentive'.

    Loan versus a grant:
    • Loan – must be paid back in full
    • Grant – paid for by increments from property taxes; not required to be paid back

  2. Is the municipality required to send a copy of the developer's agreement to the Wisconsin Department of Revenue (DOR)?

    No. The municipality does not need to send the agreement to DOR. However, the law states a copy of the developer's agreement must be sent to the Joint Review Board (JRB) or, if the TID is terminated, saved by the municipality in the official TID records.

  3. When must the public hearing notice include the cash grant reference? Is an amount required?

    If the municipality anticipates the proposed project may include cash grants, the municipality must include this information on the hearing notice under state law (sec. 66.1105(4)(e), Wis. Stats.). The hearing notice does not need to include the purpose of the cash grant or list the exact amount.

  4. Who makes the decision on what to include in a developer's agreement?

    The municipality and their attorney decide what information to include in the developer's agreement.

FOR MORE INFORMATION PLEASE CONTACT:

MS 6-97
WISCONSIN DEPARTMENT OF REVENUE
Office of Technical and Assessment Services
PO Box 8971
Madison, WI 53708-8971
Phone: (608) 261-5335 or (608) 266-5708
Email additional questions to ​tif@wisconsin.gov

May 4, 2018