Future of Minnesota Tax Increment Financing in Doubt.

New state legislation aimed at reforming Minnesota's property tax system shouldn't affect repayment of outstanding TIF bonds. However, the new legislation could seriously limit the future use of TIF bonds and reduce funds for other projects. The new tax bill shifts the percentage of overall property taxes from industrial firms to residential property owners. It also eliminates the local property tax levy paid to fund K-12 education. The state will control that expense. Legislative actions are expected to curtail funding for TIF districts by 25-35 percent. These changes will have the greatest effect on local governments in the Twin Cities area. Although the City of Minneapolis will be able to repay its current TIF debt, other programs...