TIF -Tax Increment Financing

A Tax Increment Financing (TIF) agreement is a negotiated agreement between a business and a local municipality that provides tax relief to the business in exchange for job creation. The agreement exempts the business from paying taxes on the increased value of its property due to the business's investment. 

Here are some key details about TIF Agreements:

  • Term: TIF agreements can last from 5 to 20 years. 
  • Exemption percentage: The percentage of the exemption can range from 5% to 100%. 
  • Assessment: The business pays full taxes on the property's "base value". The agreement may also phase in the assessment of the property's total value over the term of the agreement. 
  • Approval process: The municipality must get approval from the Town Meeting and then the State Economic Assistance Coordinating Council (EACC). 
  • Affordable housing: A variation of the TIF agreement, called the Urban Center Housing Tax Increment Financing (UCH-TIF) agreement, includes restrictions to ensure that a certain percentage of the housing is affordable. 

TIF agreements can help promote job growth, generate revenue, and encourage private investment in public infrastructure.

Urban Center Housing Tax Increment Financing (UCH-TIF)

This program authorizes cities and towns to promote housing and commercial development, including affordable housing, in commercial centers through tax increment financing.

The Urban Center Housing Tax Increment Financing (UCH-TIF) Program is a statutory program authorizing cities and towns to promote housing and commercial development. The UCH-TIF Program provides real estate exemptions on all or part of the increased value (the "Increment") of improved real estate. Tax increment financing may be combined with grants and loans from local, state and federal development programs. The Executive Office of Housing and Livable Communities' (EOHLC) Division of Community Services is responsible for the operation and administration of the UCH-TIF Program.

-Click here to learn more about Massachusetts Economic Development Incentive Program