Review TIF Districts for Decertification Requirements

Under the TIF Act, a TIF district may be required to decertify for a variety of reasons. It is important to be aware of the decertification requirements and review each district to determine if the requirements may apply.

• The TIF Act sets a maximum statutory limit on the duration of a TIF district based on the type of district. The maximum duration limits can vary anywhere from eight to 25 years after the first receipt of tax increment.
• TIF plans may specify an earlier decertification date than the statutory maximum limit. Review the TIF plan periodically to ensure that the authority does not collect tax increment in excess of the required decertification date identified in the TIF plan.
• While a TIF district may be required to decertify on the date identified in the TIF plan or the statutory maximum limit, the TIF district may also be required to decertify earlier under the Six-Year Rule. This provision in the TIF Act requires, in general, that a district be decertified when the in-district percentage of cumulative tax increment revenues equals or exceeds an amount sufficient to pay qualifying in-district obligations.
• An authority may also request that the county decertify a district early. If this occurs, the authority must notify the county in writing. The date the district is to be decertified can either be upon receipt by the county of the request or a date specified in the request.

Last referenced October 20, 2023 in the State Auditor's Weekly Update.