Budget for Website - Flipbook - Page 49
Tax Abatement and Tax Capture
The City of Plymouth has utilized various state laws designed to promote the development of
businesses and industries. Currently the city utilizes abatements, payment in lieu of taxes and
Tax Increment Financing.
Tax Abatement
Public Act 198 of 1974 (Industrial Facilities Exemption Act), allows Cities to reduce property
taxes on new or rehabilitated industrial facilities for up to 12 years.
Tax Increment Financing
Tax Increment Financing (TIF) captures the increase in property tax revenue generated by
new development within designated districts. These funds are restricted and used to finance
eligible redevelopment and infrastructure improvements.
Downtown Development Authority
The City of Plymouth created the Downtown Development Authority (DDA) under the
Recodified Tax Increment Financing Act, Public Act of 2018. By ordinance the city established
the DDA effective July 1, 1983. The DDA plan for the City of Plymouth primarily focuses on
downtown parking needs and beautification projects. Originally, the plan was formulated to
address debt retirement associated with the construction of the existing parking deck in 1982
and the sale of bonds for the streetscape improvement project initiated in 1994. In 2006, the
plan was amended to extend the term of tax capture until December 31, 2033.
Brownfield Captures (Brownfield TIF)
Brownfield TIF is authorized under the Brownfield Redevelopment Financing Act, Public Act
381 of 1996, as amended. Brownfield captures are administered by local Brownfield
Redevelopment Authorities (BRAs) and often require state‑level approval of eligible
activities. Brownfield tax increment captures use tax increment revenue to reimburse
approved costs associated with the redevelopment of blighted, vacant and contaminated
sites.
In Fiscal Year ending 2003, six projects were approved for environmental cleanup and
redevelopment under Brownfield TIF. All but one was rescinded due to the economic
downturn of 2008.
The effect on the City is a reduction in increases in the taxable value of the affected properties
for the period established in the approved plan, generally 5-15 years. Therefore, while the
City benefits in the long run from additional taxes due to the redevelopment of contaminated
sites, there is no financial benefit in the short term.
City of Plymouth 2026/27 Budget
45
