Note: For a better understanding of what TIF is and how a section of Polson became a TIF district, please read TIF Trouble in Polson – Part 1

TIF Can be Abused
Although TIF is generally sold to local governments as a tool to redevelop blighted areas, some places have abused this and relied on TIF for uses well beyond their original intent. The term blighted becomes a stretch of the imagination.

One example is California which was the first state to use TIF. It began in 1952 and became more popular in the 80s and 90s. The program has ended because redevelopment agencies began declaring things like undeveloped deserts and better neighborhoods “blighted.” The debt has become unmanageable.

Another noticeable problem occurs when TIF districts become subject to local politics and favoritism. A recent report from Hackensack, New Jersey (J.D. Tuccille, 6/13/13) stated that voters booted out the entire city council. Controversy had been brewing because citizens criticized Hackensack’s redevelopment projects, calling them “sweetheart deals and special privileges for politically connected property owners and developers.” Last month, the Appellate Division of the state Superior Court agreed, ruling the Planning Board didn’t properly prove that those properties were blighted and “in need of redevelopment.”

Evidence of TIF Abuse in Polson
The Riverside Stairway is an example of someone looking for a pot of money. City Commission meeting minutes (6/7/10) stated that “donations [were] being solicited by the Polson Business Community for the stairway at Riverside Park [by] selling plaques to be installed on the stairs with the donors’ name. They [hoped] the stairs would be completed by this summer.” The goal was not met so the PRA was asked to help them out the following year. City Commission meeting minutes (6/6/11) had this agenda item: APPROVE PRA RECOMMENDATION TO CONTRIBUTE $6,300 OF THE TIF FUNDS TO RIVERSIDE PARK STAIR COMPLETION PROJECT. The spending was approved and Mayor DeVries showed her support by stating that “other cities had used TIF funds for similar public projects, with the thought that it enhanced the surrounding properties.” How about “if everyone jumps off the cliff, should we? “ Wrong is wrong, no matter how many people are doing it.

The walkway bridge under the Highway 93 bridge needs closer scrutiny. First, the influence of Envision Polson! must be questioned. This group has set goals for Polson based on their own personal interests (City Commission meeting minutes 5/5/12). The walkway under the bridge is one of their goals. When the Envision Polson! leader was asked to reveal who belongs to the group, the request was flatly rejected. Any group acting as a branch of the government should be identified.

Rationale for the walkway bridge under the bridge, presented at the City Commission meeting (3/4/13), does not pass the TIF test. Newly elected PRA chairman Ken Avison reported the rationale for the [walkway bridge under the bridge] comes in part from the document ‘Tax Increment Financing in Montana, A Manual for Local Governments and Economic and Community Development Agencies’ prepared by the Governor’s Office of Economic Development: These efforts should focus on demonstrating how TIF can, in the long run, benefit everyone through the elimination of blight and the development of necessary infrastructure to attract new investment” [emphasis added]. Let it be known there is no blight or necessary infrastructure in the walkway bridge under the bridge.

The hired bond attorney, Mr. Bob Murdo, brother-in-law to Jules Clavadetcher, said he researched “whether these projects fit within the TIF laws of Montana. He said the law authorizes infrastructure improvements that include walkways, park improvements and improvements to recreation areas” [emphasis added] The italicized terms in the previous sentence do not appear anywhere in the 57 page TIF manual Mr. Avison referred to and nothing like that is found in Montana Code under Urban Renewal.

One bit of rationale from Commissioner Campbell clearly shows how TIF can be abused by people with a wish list. He stated that, “[the walkway bridge under the bridge] has been a project in the mind of the townspeople for thirty years.” Several citizens spoke as proponents for the walkway bridge under the bridge, but none referred to blight or a deficiency in infrastructure.

In summary, it has become very clear that in Polson, a small group of people with special interests have a great deal of influence over how taxpayer money is spent and possibly with great financial risk. This TIF project is only one example. There are others. Awareness is the first step in bringing this under control.