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The Town of Madison and Backyard Farms entered into a Tax Incentive Financing (TIF) agreement in 2006. This program captures the new property tax value associated with Backyard Farms, and sets aside the taxes paid on the new value. The taxes paid on the new value are “TIF Revenues.”
Approximately 70% of the TIF Revenues go back to Backyard Farms as a reimbursement for 20 years, and 30% get set aside by the Town to pay for special projects that are approved by the Madison voters and by DECD.
Additionally, the Town receives some additional money from the State of Maine as payments to make up for personal property taxes that the Town used to receive from Backyard Farms on property that is now tax exempt. Those additional payments are required to go into the Town’s TIF account and must be used to pay for the Town’s TIF projects.
Amendments were made to the Backyard Farms TIF Agreement in 2008, and most recently in 2014. At a Special Town Meeting held December 2, 2013 residents voted in support of amending the current Tax Increment Financing (TIF) agreement with Backyard Farms. The agreement, which is in place through 2035, was expanded to allow for projects that will provide funding for transportation upgrades, public safety, water and sewer upgrades and development of recreational trails. The updated project list can be seen in the State approval letter from the Department of Economic and Community Development.
In addition to the updated project list the 2014 amendment adds several pieces of town owned property to the TIF district, including former school buildings on Weston Avenue, Old Point Avenue and the business park. In total, the TIF district includes 160 acres of property and public roads in the Town of Madison.