How to Use Tax Programs to Fund Economic Development Activities
17 Feb 2022
In Wyoming, there are several tax programs available to fund economic development at the local level. These programs are cost-effective for property owners and residents, while still generating enough revenue to make a significant impact. In communities priding themselves on having low taxes, these solutions have been incredibly effective in places like Goshen and Freemont County. Goshen County voters approved the use of a quarter-cent sales tax (a penny for every dollar) to fund economic development. Since then, the taxes generated have been used to fund façade and signage grants, business equipment upgrades, training, capital improvements, special projects and emergency funding programs for local businesses. Goshen County’s Cobblestone Hotel is just one project that resulted from funds being available to conduct studies and prepare for future development. “We were able to assist the developers in prepping the brownfield site on Main Street, prior to them breaking ground on the 54-room hotel,” said Ashley Harpstreith when she was the CEO of Goshen County Economic Development Corp. For a community in need of a hotel, this was a major win with a positive economic impact on the community.
Fremont County uses a similar process to fund economic development. Voters passed a one-half percent sales tax, 70 percent of which funds projects in specific communities, while 30 percent funds commercial air service and ground transportation. The benefit for the community is significant and it only costs the average resident $80 per year. “The possibilities for economic development projects are virtually unlimited,” said Kevin Kershisnik, Executive Director of IDEA Inc. Riverton’s Economic Development. To ensure that the community has a say in how the funds are spent, anyone can submit a proposal for consideration by the local committee.
While residents of Goshen and Fremont counties voted for these measures, not all programs have to end up on the general ballot. In Casper they passed a mill levy tax to benefit the Downtown Development Authority (DDA). Commercial property owners, rather than the general public, voted to approve a 16 mill tax to fund the DDA operation of David Street Station and to support businesses in Casper’s downtown.
Cheyenne also uses a mill levy tax to fund their Downtown Development Authority (DDA), something that allowed them to launch 11 projects to improve businesses and increase property values in 2021. Haylee Chenchar, Managing Director and Vice President of the DDA, reported growth in their downtown with the opening of forty-five new businesses and a $3 million revenue increase. “We are being able to impact our community, for our community, so much more on a united front than we were doing on our own, and I am just so grateful for that,” Chenchar told Wyoming News Now.
Tax Increment Financing (TIF) is another funding mechanism that should be explored by Wyoming communities. Cheyenne is using their TIF to fund their Urban Renewal Agency (URA). When redevelopment projects are funded, the increased taxes are used by the URA to fund additional projects, furthering the cycle of growth. In this sense, a TIF can be used to circulate funds within a community to maximize growth opportunities. For information on how to leverage Tax Increment Financing, contact Ryan Whitehead, Business Finance Program Manager for the Wyoming Business Council by emailing firstname.lastname@example.org.