How Effective Are Property Tax Abatements? The Case of Michigan

2013 ◽  
Author(s):  
Sung Hoon Kang ◽  
Mark L. Skidmore ◽  
Laura Reese
Keyword(s):  
Property Tax ◽  
Tax Abatements ◽  
Property Tax Abatements

Is Tax Competition Strategic? Spatial Distributions of Business Property Tax Abatements in the Chicago Suburbs

2020 ◽  
pp. 089124242097769
Author(s):  
Richard Funderburg ◽  
Joshua Drucker ◽  
David Merriman ◽  
Rachel Weber
Keyword(s):  
Spatial Distribution ◽  
Local Governments ◽  
Property Tax ◽  
Tax Incentives ◽  
Cook County ◽  
Tax Increment Financing ◽  
Policy Goals ◽  
Tax Abatements ◽  
Business Property ◽  
Property Tax Abatements

The authors analyze the locations of property tax abatements awarded to businesses in Cook County, Illinois from 2012 to 2014 to explore their spatial distribution and to examine local government motivations for awarding incentives. The authors’ analysis, which controls for the spatial distribution of businesses, reveals a clustering of abatements at intramunicipal geographic scales. They also find amplified probabilities that abatements are awarded to businesses located near tax increment financing districts or enterprise zones. These patterns suggest that local governments use abatements in a strategic fashion to advance policy goals. The authors use the same data to develop three indices of the degree of abatement clustering at the municipal scale for each of the 64 municipalities in Cook County that awarded five or more abatements. Most of the Chicago suburbs exhibit a pattern consistent with the strategic award of business tax incentives.

Residential Property Tax Abatements and Rebuilding in Cleveland, Ohio

2010 ◽  
Vol 42 (2) ◽  
pp. 104-117 ◽  
Author(s):  
Mark S. Rosentraub ◽  
Brian Mikelbank ◽  
Charlie Post
Keyword(s):  
Property Tax ◽  
Residential Property ◽  
Tax Abatements ◽  
Cleveland Ohio ◽  
Property Tax Abatements

Tax abatement reporting: Perspectives of users and preparers

2014 ◽  
Vol 26 (3) ◽  
pp. 429-457 ◽  
Author(s):  
Judith Harris ◽  
Karen S. McKenzie ◽  
Randall Rentfro
Keyword(s):  
Economic Development ◽  
Financial Reporting ◽  
Property Tax ◽  
Board Members ◽  
Specific Information ◽  
Advocacy Groups ◽  
Tax Abatements ◽  
Potential Benefits ◽  
User Groups ◽  
Tax Abatement

Using tax abatements to spur economic development can be controversial. The potential benefits are stressed when abatements are granted, but subsequent reporting may be insufficient for citizens to hold governments accountable for actual results. We solicited perspectives on tax abatements from three user groups (citizens representing advocacy groups, county board members, and financial analysts) and county officials involved in financial reporting, budgeting, or property tax administration. Users and preparers expressed generally similar views about the need for reporting; however, some differences were evident in the degree of support for reporting specific information items and the format for making information available. We also found that much information desired by users is not available to them currently, and governments may need to create mechanisms to collect information.

scholarly journals The Fiscal Impact of Local Property Tax Abatement in Indiana

2016 ◽  
Vol 2 (2) ◽  
pp. 161
Author(s):  
Michael Hicks ◽  
Dagney Faulk
Keyword(s):  
Local Governments ◽  
Property Tax ◽  
Local Property ◽  
Strong Relationship ◽  
Tax Rates ◽  
Absolute Size ◽  
Fiscal Impact ◽  
Tax Base ◽  
Tax Abatements ◽  
Tax Abatement

Property tax abatement is widely used by local governments in the U.S. with the goal of attracting and retaining businesses. This analysis examines the efficacy of such abatement using data on Indiana counties from 2002 through 2011. The analysis suggests that local tax abatement tends to be correlated with higher effective tax rates in a county. These correlations exist in the absolute size of abated property relative to the existing assessed value of property taxes and in the frequency of use of tax abatements. In addition, there is not a strong relationship between abatement and the growth of assessed value over time. The implication is that, on average, the use of abatements as a tool for growing a property tax base is not particularly effective. These findings cast doubt on the ability of Indiana’s system of property tax abatements to increase the tax base or control property tax rates.

Tax Increment Financing: A Propensity Score Approach

2017 ◽  
Vol 31 (4) ◽  
pp. 312-325 ◽  
Author(s):  
Anita Yadavalli ◽  
Jim Landers
Keyword(s):  
Economic Development ◽  
Employment Growth ◽  
Property Tax ◽  
Tax Increment Financing ◽  
Policy Makers ◽  
Level Data ◽  
Multiplicative Effect ◽  
Tax Abatements ◽  
Development Outcomes ◽  
Over Time

This study examines the effect of tax increment financing (TIF) on economic growth in Indiana. TIF areas are designated with the intent of spurring economic development characterized primarily by growth in assessed value and in employment within the TIF area. We examined property-level data from 2004 to 2013 and found that the average property in a TIF area may display higher assessed values than the average property in a similarly situated non-TIF area. While both TIF and non-TIF properties tended to grow over time, the average property in a TIF area may grow by slightly more than its non-TIF counterpart. We also found that TIF does not statistically significantly affect employment or employment growth over time. While there does not appear to be a multiplicative effect of the presence of enterprise zones and TIF on employment, TIF works with property tax abatements in incentivizing job creation. Our analysis of the effect of TIF on economic development outcomes informs policy makers of the likelihood that a given area will adopt TIF in the context of the “but-for” question.

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