Tax Increment Finance (TIF) Districts in Chickasha

Updated April 2024

In late 2023, the Chickasha City Council formed a committee to develop, refine, and review proposals to create new tax increment finance (TIF) districts. The committee includes representatives from the City Council, the taxing entities affected, the business community, and at-large representatives. The committee will ultimately either recommend for or recommend against the creation of a new TIF district, and if for, they will specify the boundaries, duration, and eligible uses of funds. The City Council will make the ultimate decision based on the recommendation of the committee.

The next meeting of the Tax Increment Finance Committee is scheduled for Wednesday, May 22, at 1 pm. Meetings are held at City Hall and are open to the public. They are also livestreamed and archived on the City of Chickasha YouTube channel.

What is tax increment financing?

Tax Increment Financing (TIF) is a public tool that reallocates newly generated tax dollars for up to 25 years for supporting development or redevelopment in certain limited areas of a city, town, or county. In Oklahoma, the terms and conditions for using TIF are provided in the Local Development Act (62 O.S. §§850-869).

—Oklahoma Department of Commerce
A simplified graph illustrating the the existing tax base, potential captured increment during the TIF, and new tax base after the TIF.

The TIF captures some or all of the increase (increment) in tax revenue generated over a set period of time within a specific area. This funding is then available for use in public improvements, and/or certain other purposes outlined in state law and specified by the public body. It does not increase tax rates.

The “But For” Rule

The objective of a TIF district is to enable development that would not happen otherwise—i.e., “but for the TIF, this development will not take place.”

What is the current proposal?

The current working proposal being considered by the committee would create two new TIF assessment districts—one containing most of the downtown district, the other including properties along Highway 62 and Grand Avenue on the east side of town, near Interstate 44.

Chickasha has had one TIF previously (now expired), so for identification purposes, the proposed districts are called TIF #2 and #3, respectively. The names and boundaries of the districts are subject to change at the discretion of the committee.

The exact uses for the revenue captured by the TIF will be defined by the committee.

TIF #2: Downtown

Map of downtown Chickasha with the proposed TIF#2 boundaries outlined in blue.

TIF #2 would capture the benefit of redevelopment in Downtown Chickasha, including the new developments in the Depot area. It runs from 6th St. in the west to the far side of 1st St. in the east, and includes both sides of Choctaw, Chickasha, and Kansas (and some of Iowa).

TIF #3: “Gateway to Chickasha”

Map of northeast Chickasha with the proposed TIF#3 boundaries outlined in green.

TIF #3 would capture new development in Chickasha’s east entryway. It includes largely undeveloped properties along Choctaw Ave./US-62 coming off Interstate 44, as well as along the eastern loop of Grand Avenue.

Generally speaking, the properties carved out of the above assessment areas are tax exempt or are not expected to increase in value, and thus would not contribute to TIF revenue.

Update: Based on committee feedback, the preliminary project plan will be based on a 50% allocation of increment funds. 50% of increment revenue would be returned to school districts, county funds, and other taxing entities according to normal rates.

What will it accomplish?

City leadership and the EDC have identified utilities and infrastructure to be among the greatest barriers to new development in Chickasha. TIF is a tool that can generate funding for infrastructure projects that the city cannot currently afford.

Preliminary plans for use of TIF revenue include the installation of new water and sewer mains, particularly east of the railroad, as well as a new water storage tank, adding to the capacity and range of the city’s utility services. The area that would be served by these improvements (“project area”) extends far beyond the assessed area.

The exact extent and estimated cost of these projects is still to be determined.

Other Frequently Asked Questions

No. The TIF does not create a new tax or raise tax rates.

There is no added cost to property owners. The TIF revenue comes from assessed values increasing due to voluntary improvements made to the property. If no improvements are made, and the property value remains consistent, there is little effect.

Property owners will pay the same ad valorem tax rates, based on property value, as they would without the TIF.

The tax revenue captured by the city, county, schools, etc. from affected properties will remain fixed at its current amount for the duration of the TIF, and will not decrease. In addition, a portion of the increment captured by the TIF can be returned to the taxing entities.

The City of Chickasha will manage the funds generated by the TIF according to the guidelines set by the TIF committee.

The EDC is assisting in the research and promotion of the TIF but has no authority in the decision-making process.

TIF revenues may be spent only for publicly approved project costs within a specific geographic area, known as the Project Area. The Local Development Act defines project costs to include a wide range of public expenditures including:
  • Cost of public works, public improvements, land acquisition, clearance, and grading
  • Financing, professional services, administration, interest fees
  • Assistance in development financing for private projects
(Source: Oklahoma Dept. of Commerce)
The planning process can be expected to take several months before it is presented to the City Council for final approval. There is no clear timeline as to when it would go into effect if approved.