Tax Increment Financing for Blighted Areas in Nashville on Temporary Hold

Metro Nashville officials have imposed a moratorium on its Tax Increment Financing practices, which occur when government officials award special tax incentives to real estate developers to spruce up supposedly blighted parts of town.

This practice goes on nationwide, as The Tennessee Star reported.

Critics say TIF continues to benefit areas that no longer suffer from blight — with Nashville’s Gulch area as one example.

For six months, and while the moratorium is in effect, a seven-member panel will study how Metro officials can use and implement TIF. Specifically, they will evaluate how to use TIF “in a more transparent, equitable, effective and understandable manner,” said Metro Council Member Bob Mendes, in an email to The Star.

Two members of Nashville’s Metro Housing and Development Agency will appoint two of the panel’s seven members. Mayor David Briley will appoint two more. Members of the Metro Council, meanwhile, will appoint the remaining three, Mendes said.

Members of the MDHA oversee TIF and select who gets it.

“My intention was to have a mix of perspectives,” Mendes said.

“So, for example, I would expect that the MDHA appointees would be involved in Tax Increment Financing decisions. The goal is to achieve balance by having different groups appointing the different members.”

The study will also try to assess how TIF is rewarded, the strengths and weaknesses of the award process, and whether those methods need revising, Mendes said.

“I don’t think momentum will be gone by the time the six-month study group is done,” Mendes said.

“The voters of Davidson County are going to have this topic on their minds as we head into the August 2019 city elections.”

Mendes originally set out to change TIF by setting aside 31 percent of all TIF tax dollars exclusively for education on all future projects, according to News Channel 5.

The TIF moratorium and the study were part of a compromise, whereupon Mendes agreed to defer multiple proposed ordinances of his targeting TIF, according to The Tennessean.

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Chris Butler is an investigative journalist at The Tennessee Star. Follow Chris on Facebook. Email tips to [email protected].