Survey of Council Members Suggests City is Open to Residential TIF Deals
By Jim Dayton, Janesville Gazette
If a project helps address Janesville’s housing shortage, and if the financial details make sense, city council members said they’re open to using tax increment financing to subsidize residential development.
They stressed the council must unravel those ifs before approving any deal. But using TIF incentives for housing—something the city hasn’t done in nearly two decades—could become the new normal for Janesville if it wants to boost its housing stock.
Last week, the city and Forward Janesville co-sponsored a housing forum where two outside developers suggested tax increment financing was essential if Janesville wanted more residential projects.
Several council members attended the forum. They learned more about a tactic that hasn’t been used here for housing development since the Marshall Apartments in 1999.
“It would be a major policy shift for the city and city council to investigate that,” Council President Doug Marklein said Wednesday. “But based on the realities of the marketplace, what we heard at the meeting from two outside people, that is becoming the norm now. That’s what cities are doing to make the economics work, to fill the gap.”
Marklein is a partner at a family homebuilder business. He sees the issue from both sides: the struggle to make money in a market with relatively low rents and the city’s limited ability to provide assistance.
His business is interested in constructing a 12-unit apartment building, but right now it’s not financially feasible. Marklein fears he wouldn’t see a return on his investment because Janesville rents are too low, he said.
Higher rents would attract developers, but it could make housing unaffordable to some city residents. If rents stay the same, developers might need municipal dollars to cover construction costs. Otherwise, they might not bother building here, he said.