Small towns such as Lennox face a unique challenge when it comes to growth. We want new businesses, good housing, and thriving downtowns, but our budgets don’t always stretch far enough to make those things happen. That’s where a tool called Tax Increment Financing, or TIF, comes in. While it sounds like government jargon, TIF is actually a simple idea with big benefits for communities like ours.
Here’s how it works: when a town creates a TIF district, it sets aside the increase in property taxes from new development within that area. Instead of going straight into the general budget, that new money is reinvested into the district to pay for improvements—things like roads, utilities, or even the cleanup of old, blighted properties. The best part? Existing taxpayers don’t see a higher tax bill to pay for the new roads and utilities. The improvements are funded by growth itself – by those properties that are benefited by the new roads and utilieis.
One of the biggest advantages for small towns is the ability to build the infrastructure needed to attract development. Think about what it takes to bring in a new business park or housing development: streets need to be extended, water and sewer lines might need to be extended, new drainage areas must be built, and the land itself needs to be graded. Without help, those upfront costs stand in the way of investment. TIF gives towns the ability to cover those expenses, making projects possible that would never get off the ground otherwise.
TIF also helps small towns compete with larger cities. Developers often choose bigger communities where everything is already in place. With TIF, smaller communities can offer similar opportunities by helping offset costs and showing that they’re serious about welcoming growth. That can mean new businesses, new jobs, and new options for residents who’d like to live, work, and shop locally rather than driving to a bigger city.
But TIF isn’t just about brand-new projects on the edge of town. It’s also a powerful way to breathe new life into older areas. Many small towns have a downtown block with empty storefronts or neighborhoods where aging houses sit vacant. By investing in these areas with TIF funds—upgrading sidewalks, improving lighting, or supporting building renovations—towns can attract businesses and families back into the heart of the community. A thriving downtown doesn’t just add to the tax base, it creates pride and energy that radiates across the whole town.
Perhaps the most community-friendly part of TIF is that it doesn’t require existing taxpayers to dig deeper into their pockets. The system uses the growth generated by new development to pay for improvements. In other words, it’s a “pay as you grow” approach that allows towns to improve themselves responsibly and sustainably.
For small towns that want to stay vibrant, welcoming, and competitive, TIF is an important tool. It gives us the ability to invest in our future, encourage development, and revitalize the places we love—without losing the small-town character that makes our communities special.