In a forthcoming book about cities and inequality, SCEPA Senior Fellow Rick McGahey examines how economists think about cities, what they typically leave out, and what this tells us about the future for urban hubs such as New York City.
TIF’s self-financing rhetoric can be used to shift risk onto taxpayers.
This research, "How Risk Undermines TIF's Self-Financing Premise: A Case Study of Hudson Yards," expands the evaluation of TIF by questioning the widespread understanding of TIF as a self-financing tool through analysis of its risks and costs to taxpayers. The authors find that disclosing and assigning project risk is necessary before the project’s public approval to provide a robust cost-benefit analysis to municipalities considering TIF implementation and to ensure taxpayers are fully informed.
Rather than being "self-financing," New York's Hudson Yards project cost the city $2.2 billion in costs, largely due to tax breaks provided by the city to incentivize development and standard development risks and costs.