Timely Payment of TIF Enforcement Deduction

Counties are required (under Minn. Stat. § 469.177, subd. 11) to deduct a percentage of the tax increment generated each year and to pay the deducted amounts to Minnesota Management and Budget (MMB). The TIF Enforcement Deduction is equal to 0.36% of any increment distributed to an authority or municipality. The deduction funds the TIF oversight activities of the OSA, and the dates and amounts of transfers are to be reported on the County TIF Information Form that is due annually in March.

The OSA recommends that counties pay deduction amounts to MMB at the time of each settlement distribution of tax increment, rather than waiting to make a single payment. This includes any deductions from delinquent taxes.

Waiting to make a single transfer increases the chances that a payment will be missed or delayed. County reporting should show the date of the payment not the date of the settlement, as some counties have mistakenly reported.

In addition, be sure to clearly report deduction amounts to MMB when those payments are made.

Last referenced December 9, 2022 in the State Auditor's E-Update.