Milwaukee officials this month are considering a new source of money to promote affordable housing development and combat foreclosures.
The new money would come from city tax incremental financing districts. Those districts let the city reserve property taxes on new developments in a given area, and spend it on infrastructure or grants to developers, for example. The districts traditionally dissolve after paying back all the money the city has spent on its initiatives.
Under the housing proposal, the districts would remain open one additional year after those costs are paid and dedicate their property taxes to affordable housing projects. After that year, the districts would close out, and the taxes they generate will go into the city’s overall budget.