The Downtown Casino, Fiscal Derivatives, and Growth Machine Politics: How Tax Increment Financing Transforms Urban Housing Markets

Authors: Thomas Corcoran*,
Topics: Urban and Regional Planning, Hazards, Risks, and Disasters, United States
Keywords: Municipal Finance, Real Estate, Urban Redevelopment, Residential Segregation
Session Type: Paper
Day: 4/10/2018
Start / End Time: 10:00 AM / 11:40 AM
Room: St. Charles, Marriott, River Tower Elevators, 41st Floor
Presentation File: No File Uploaded

How does a mid-sized deindustrialized city located in the northeastern United States restructure municipal debt, secure investment to revive a stagnant downtown, and generate discretionary revenue streams from abandoned residential and commercial properties? This paper presents one strategy: the use of tax increment financing (TIF) to securitize projected property tax returns from the construction of a downtown casino, and their repackaging for sale on the bond market. By focusing on a single case, I demonstrate how a growth coalition formed between casino company executives and local business leaders, shifts future debt obligations away from the city and onto the stakeholders of local development projects; sites funded by TIF initiatives derived from casino tax rolls. Whereas some developments backed by TIF are designated in business parks to attract manufacturers or commercial vendors, others are strategically located in city neighborhoods characterized by residential segregation and high rates of home foreclosure. City officials and developers promise these areas paths towards neighborhood revitalization, while also posing threats of potential displacement, thus leaving many Black and Latino homeowners caught between the politics of race and class. Drawing on ethnographic interviews conducted with residents, community leaders, small business owners, economic development professionals, and social justice advocates, I elaborate upon agents’ strategies within the social space shaped by processes of urban redevelopment. Ultimately, this empirical case intends to contribute to literature on the influence of financialization in transforming urban housing markets, while assessing how revisions to state fiscal policy shape patterns of public trust and social cleavage.

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