A Little Something Called TI F Adds New Color to Paducah’s Palette of Possibilities

By DARLENE MAZZONE

TIF. ASPCA. WKCTC. NAACP. GPEDC. NCAA. LOL.

Sometimes our meanings are reduced to random letters. Relevant yet nebulous. Meaningful yet mysterious. You’re probably familiar with most of the alphabet soup in the opening line, but perhaps not the initial one. So what IS a TIF?

“A TIF is a Tax Increment Finance district,” explains Katie Axt, Paducah’s Downtown Development Specialist. “It’s a financing and development tool that allows local governments to capture state property and other taxes generated on the increased value of new downtown developments. Those funds are then used to build infrastructure improvements along the riverfront and downtown.”

So THAT should clear things up.

In other words, with the utilization of a TIF, Paducah gets more tax money staying in the community and less going to the state government.

In Kentucky, taxes collected by the state government are also eligible to be directed back to the city, which is a completely new revenue source for municipalities like Paducah. The captured value of the increase in tax revenues is used to finance public infrastructure and to attract private development projects. “Eligible public expenditures include parks and open spaces, public parking, streets and sidewalks, and environmental remediation on historic properties,” Katie adds. In order to qualify for a here has been a vision for growth in Paducah for as long as I can remember. Over the years I have seen the landscape of our city change. Opportunities present themselves, and we don’t always see them at first. This most recent investment in historic Downtown Paducah is yet another step to bring our area to the forefront of Kentucky. As we put our city in the spotlight, we have everything we need, including interstate highways, rivers, railroads, and an airport. These things attract bigger companies, and they will see the beauty and benefit in our area.

It’s about opportunity. It’s about growth. It's about the future of our city and the future of western Kentucky. Now is not the time to be afraid of change. It is the time to be brave and utilize change in order to grow and better our community! We will lead the way to a new generation of business and growth. We will attract the jobs our citizens want and need.

We will make opportunity for future generations. I believe in Paducah.”

—TODD BLUME, OWNER, PADUCAH BEER WERKS

TIF, a city must be able to demonstrate that development in the TIF district would not occur but for the TIF-funded public improvements, and that the use of TIF funds will generate new economic activity.

In April 2019, the City of Paducah and McCracken County passed a resolution and executed an agreement to establish the area’s first TIF along Paducah’s riverfront along with a portion of downtown. In July, Paducah submitted its application to the state. In the application, the City articulated a suite of projects that would generate new economic activity in the Commonwealth that could not be accomplished without the use of a TIF. The application also identified several private development opportunities to spur investment and generate the tax increment needed to fund infrastructure projects.

In August Paducah received preliminary approval by the Kentucky Economic Development Finance Authority (KEDFA) for Paducah’s Downtown Riverfront TIF District.

Over the next 20 years, Paducah’s TIF project is expected to generate $123 million in eligible revenues. Those would include:

• State tax revenues of $99 million (sales, property, and individual income tax)

• Local tax revenues of $24 million (city and county property, city payroll)

“When implemented as a cohesive and whole project, the downtown and riverfront areas come together to create an economic hive for small business and to establish a vibrant urban neighborhood that meets the needs of Paducah’s changing population,” Katie adds. “It will also allow us to expand a beloved destination that celebrates Paducah’s unique history and creativity.” Many private sector development opportunities exist today that are ready for local development and investment, which would contribute to the growth of the community. “It is through private investments in projects like the town square proposal, Whaler’s Catch, GenCanna, and the Rubel Dry Goods building that unlock the ability to implement some long-awaited public benefit projects. Those might include Paducah Commons, the riverboat excursion pier, the former showroom lounge, and the restoration of the Columbia Theater.”

The application and projections will be vetted by KEDFA in early 2020. Then the group will draft an incentive agreement detailing the footprint, specific taxes, and infrastructure expenditures along with reporting requirements leading to potential final approval in the spring of 2020. Activation occurs once the City reaches $20 million in capital investment.

“This is such an exciting opportunity for Paducah,” Katie comments. “When I moved to Paducah to take this position just a year ago, I saw so much potential in this vibrant community. I was so energized by the vision of the leadership here and the steps being taken to capitalize on Paducah’s many concrete and creative assets. To see this funding source come to fruition gives us the ability to produce real results for Paducah’s continuing success.”

For more information, visit paducahky.gov/downtown-redevelopment

Meet Katie Axt

When people heard that Katie was coming to Paducah from New York City, the reactions ranged from raised eyebrows to furrowed brows. But once she arrived on the scene, everyone’s expressions relaxed as they quickly witnessed Katie’s relaxed demeanor and mid-western charm.

“I grew up in Wisconsin, and I’ve lived on both coasts,” Katie explains. “Life for me has been broad and multi-faceted. I’ve experienced everything from the city that never sleeps to the laid back lifestyle of California. I think Paducah is a wonderful blend of all good things!”

Katie has a BA from the University of Wisconsin and an MA from UCLA. She has worked in historic preservation, as an urban planner, and in New York City’s Department of Environmental Conservation. In 2012 Katie was awarded a Special Citation for Vision 2020, for a comprehensive waterfront plan.

She joined Paducah city government in 2018 and currently serves as Paducah’s Downtown Development Specialist.