By Sara Strong
Dick Asleson, a financial consultant for the city, reported on a tax increment financing review he completed for the city.
The purpose of the review during Tuesday's meeting of the Luverne Economic Development Authority wasn't to judge the validity of TIF projects but to report on the status of them.
"We didn't sit down and say ÔDid the council make the right decision in 1992?' I don't know," Asleson said.
With TIF, the city, county and school do not realize additional tax revenues from projects until development costs are paid off.
Asleson said that $4.1 million in capital improvement has been completed in Luverne since 1975, when the first TIF district was established.
The concept of TIF has been debated at all levels of government, and the state changes rules in the program in nearly every session.
Most recently, legislative decisions mean that Luverne is getting less of the TIF money from the projects than previously expected.
Until all the TIF districts are paid off, the city will get an estimated $440,000 less than first calculated, starting in 2003. That number, Asleson said, is a very high estimate and includes all the years the current TIFs will be in existence.
In 2002, the city will get about $47,000 less than expected.
The Agri-Energy and Jubilee Foods TIFs are paying as much as was budgeted for because their agreements included provisions to make up for any money lost to the state.
Even though the city will see less money from TIFs, the businesses will probably still pay out the same amount because of new business taxes.
Because of so many variables, like state grants that may make up for the lost revenue, the city is unsure how the budgets will be impacted in years to come.