LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
FISCAL IMPACT STATEMENT
LS 6221 NOTE PREPARED: Feb 6, 2025
BILL NUMBER: SB 104 BILL AMENDED: Feb 6, 2025
SUBJECT: Residential Tax Increment Financing.
FIRST AUTHOR: Sen. Niemeyer BILL STATUS: 2
nd
Reading - 1
st
House
FIRST SPONSOR:
FUNDS AFFECTED: GENERAL IMPACT: Local
DEDICATED
FEDERAL
Summary of Legislation: (Amended) This bill provides, in the case of an allocation provision adopted after
June 30, 2025, for a residential housing development program, that the redevelopment commission shall
annually transfer at least 5% of the aggregate allocated tax proceeds from the allocation area to the unit that
established the commission. The bill specifies that the unit must use the revenue for police and fire services
that serve the allocation area.
Effective Date: July 1, 2025.
Explanation of State Expenditures:
Explanation of State Revenues:
Explanation of Local Expenditures:
Explanation of Local Revenues: (Revised) Public Safety Transfer: Under this bill, at least 5% of the
property taxes generated on the incremental AV in new residential housing TIF districts will be transferred
to the authorizing taxing unit to pay for police and fire capital and operating expenses in the TIF area.
Revenue for the authorizing taxing unit will increase, while revenue available to the redevelopment
commission will be reduced. Total taxes paid will not change. There will be no change in the revenue
distribution for residential housing TIF districts established before July 1, 2025.
The actual impact depends on the number of residential housing TIF districts established after June 30, 2025,
and the amount of incremental taxes generated in those TIF districts.
(Revised) Program Termination: Under current law, a residential housing development program must
terminate within 20 years of the date on which the first obligation is incurred. Under this provision, the
program must terminate earlier than the current 20 year date if the first obligations are satisfied before that
time.
SB 104 1 When a program is terminated, the allocated assessed value (AV) is added to the tax base of the taxing units.
The additional AV will reduce tax rates and may reduce tax cap losses to the taxing units.
State Agencies Affected:
Local Agencies Affected: Taxing units that authorize new residential housing TIF districts; Redevelopment
commissions.
Information Sources:
Fiscal Analyst: Bob Sigalow, 317-232-9859.
SB 104 2