LAWTON – City officials are exploring the possibility of setting up a new tax increment financing district within an existing district.
The FISTA Development Trust Authority recently asked the Lawton City Council to study the potential financial benefits of establishing a new TIF district within TIF District No. 1, which covers most of downtown Lawton. Revenues from the new district could help pay for long-term projects designed to boost economic development, including the FISTA Innovation Park in Central Plaza.
In Oklahoma, TIF districts are tools to spur economic development. Cities with TIF districts use part of the taxes generated within the district to either invest in improvements there or fund other economic development projects.
New business development in the district boosts property values, and any increase in city tax revenues is plowed back into the district.
Lawton’s TIF District No. 1 was established in May 2006 to support business development and clear blight in downtown Lawton, especially along Second Street and C Avenue. TIF District No. 2, which was created on a smaller piece of land in the first TIF district, covers retail development along Northwest Second Street.
If the Lawton City Council approves FISTA’s request, Deputy City Manager Richard Rogalski would work with the Center for Economic Development in Oklahoma City to determine whether creating a new TIF district makes sense. The new district would focus on Central Plaza.
Creating a new TIF zone within the existing district would make it easier for the city to capture tax dollars in that district, Rogalski said.
“You’re already in TIF 1,” he said. “But the problem with that is, you’re in a big bucket that if you pour water into your part of it and water goes out somewhere else, you’ve got no increment. So, you don’t capture your investment.
“But if you make it a smaller bucket and you pour water into it, you get more water. That’s why you would focus this TIF district.”
Rogalski said the city already has a model for setting up TIF districts in industrial zones, so creating a new one would not be difficult.
“We’re not starting from zero in terms of that,” he said. “It would just simply be focusing that type of revenue sharing on this specific area.”
Any revenues from the new TIF district would go to the Lawton Economic Development Authority, Rogalski said. Through an agreement with FISTA, the Economic Development Authority could return that money to FISTA, which could use the funds to reimburse the city for the cost of acquiring and renovating Central Plaza or to pay for upgrades in the district.
“It’s very similar to an industrial TIF,” Rogalski said. “There’s a lot of money that is set aside for project improvement. It may be that we’re paying back the city with those project improvement funds, or you could simply draw on those funds to provide project improvement.”