COLUMBUS, Ohio -- When a development is built in Cuyahoga County, the new property tax it generates can be redirected before libraries, social service agencies and county programs ever see a penny.
In traditional tax increment financing districts, cities capture those dollars from the increased property values to pay for the roads, sewers and cleanup that make projects possible.
For decades, local governments used TIFs sparingly.
“It was kind of this arcane or obscure thing,” said Jim Rokakis, a member of Cleveland City Council for two decades ending in 1997. He left after his election in 1996 as Cuyahoga County Treasurer, a job he held 2011 that included oversight of county tax collections.
During his time in office, Rokakis said TIFs “were used as a last resort.” By the time he left, the county had fewer than 100.
Then the pace picked up. Today the total is 265.
And increasingly, cities are creating TIFs that are much larger than those that targeted specific projects. Now some TIFs cover large tracts of land and forgive new taxes for whole neighborhoods.
Related story: Browns $3.6 billion Brook Park project stands to get millions of dollars in tax breaks and incentives
Cleveland Mayor Justin Bibb launched his “ Shore-to-Core-to-Shore” strategy in 2024 with creation of a TIF that incorporates a large swath of the downtown, stretching from the lakefront south to the Cuyahoga River and the Inner Belt westward into Ohio City.
And TIFs sometimes target areas where projects already are underway, latching onto new tax revenues from development that didn’t need an enticement.
Defenders say the tool builds things communities couldn’t afford otherwise. But researchers have never settled whether it creates development that wouldn’t have happened anyway, even as their use has exploded.
“I think there is a kind of free lunch element to it,” said Zach Schiller, director of Policy Matters Ohio. “The idea that this can be done when there is a strain on budgets, and it’s not costing anything.”
TIFs do have a cost. Money set aside for development does not flow, at least for a time, to other public services that rely on property taxes, raising questions about who’s getting their fair share of the money.
“Of course, there are winners and losers,” Rokakis said.
The question is whether what communities get in return is worth what they give up.
How TIFs took off
By the mid-1970s, downtowns across the country were struggling. Families moved to the suburbs, stores moved to malls and factories closed. City tax bases shrank, but streets, utilities and old buildings still needed repair.
TIFs offered a fix.
A city could use the extra property tax a new project was expected to bring in to pay for demolition, cleanup, roads or other costs that kept developers away from a site. Covering them could make a project affordable.
Banks liked TIFs too. They treated the promised tax money as collateral, which meant developers needed less cash upfront and could borrow at lower interest rates.
TIFs also gave cities something to bargain with. In exchange for covering those costs, officials could ask developers to save a historic building or add affordable homes.
By 1976, the idea had national attention. While running for president that year, Jimmy Carter urged cities to pair federal community development money with local TIFs to rebuild struggling downtowns.
Ohio authorized municipal TIFs that same summer, and they spread slowly at first. Cuyahoga County didn’t approve its first one until 1987 and only had eight on the books in 1996.
How they grew and expanded
TIFs are now the fastest growing and largest form of property tax abatement in Ohio. More than $10 billion worth of property sits inside these specialty tax zones.
Some cover huge areas. Cleveland’s Shore-to-Core-to-Shore district, approved in 2024, takes in much of downtown. City officials are planning another for the East Side.
Others go to projects that were already moving.
In Orange village, The Canyons townhomes were already under construction when the mayor proposed setting aside about $4 million in future tax revenue through a TIF. Councilman James Boyle called the move fiscally sound but “morally bankrupt.”
“I think it’s a good example of another concept that has a useful purpose when appropriately utilized,” Schiller said. “But it has grown to a point where we should be asking, is this really needed? When you have a wealthy developer in an affluent area, that to me is not the real purpose of this tool.”
The concern crosses party lines. Policy Matters Ohio, which leans left, and conservative groups like Americans for Prosperity have both questioned how TIFs get used.
Ashtabula County Republican Rep. Dave Thomas, who sponsored many of the property tax reform bills in 2025, said, “I think they are very valuable, when necessary, but they are very overused.”
Still, Ohio lawmakers keep widening what TIFs can do.
The 2023 state budget let local governments extend some TIF exemptions by up to 30 years. Another state law let TIF money pay for road maintenance, not just new infrastructure.
In May, the Ohio Senate unanimously passed Senate Bill 307 from Sen. Jane Timken, a Stark County Republican, that would allow TIF money to build police and fire stations. The House has not taken it up.
How big are they?
Once thought of for specific projects, some TIFs now can cover large areas and divert millions in projected taxes.
Bibb envisioned the vast Shore-to-Core-to-Shore TIF district as a way to help erase the downtown-versus-neighborhoods narrative that long has been a tug-of-war in Cleveland politics. Diverted tax revenues -- estimated to be at least is $790 million over the next four decades
-- could be used by the city to target needs across Cleveland’s neighborhoods.
The East Side TIF proposal would create districts in two areas covering parts of the Hough, St. Clair Superior and Central neighborhoods, mirroring the Shore‑to‑Core‑to‑Shore TIF downtown.
It would redirect between $64 million to $182 million in future tax dollars to spur development. If fully implemented, roughly 2,000 acres — or about 4% of the city’s land — would fall under tax increment financing.
Discussions are underway to rework a TIF on property in Brook Park where the new Browns stadium is being built and mixed-use development is planned. The site encompasses 178 acres that sat mostly vacant after Ford Motor Co. plants closed. Tax revenues diverted in an initial 30-year-agreement could be used to support the mixed-use development portion of the project -- primarily public infrastructure, including roads, utilities, and site work, a Browns spokesman said.
Ultimately, the tax dollars diverted can add up.
In Cuyahoga County, nearly $100 million was diverted from the 2025 property tax rolls, according to the county fiscal office.
Those decisions affect other government bodies that rely on taxes. Schools often are excluded from TIF districts. But other entities are not shielded.
County government and social services agencies, park districts, libraries and community colleges do not benefit from the growth in the tax base or receive money diverted by the TIF.
Even with their growth in numbers, TIFs are a small slice of the county’s tax base.
Property inside them made up about 2.2% of total assessed value last year, according to state tax data. And TIFs were 11% of all abated property value.
Property tax abatements, community reinvestment zones, and exemptions for nonprofits and religious institutions made up the rest. So TIFs are spreading fast, but they are not the main way property is exempt from taxes.
Do TIFs deliver?
Researchers have studied that question for years, with mixed results.
In a review of more than 30 studies, economist David Merriman found that TIFs helped in some places. But his overall conclusion was blunt.
“In most cases, TIF has not accomplished the goal of promoting economic development.”
A 2025 study for the Franklin County auditor found a similar pattern. Jobs grew quickly in neighborhoods with TIFs, but those areas were already gaining jobs faster than others before the TIFs began. The researchers said, “policymakers purposefully chose to locate incentives in areas that were growing faster than the county as a whole.”
They also questioned how success gets measured. The main proof that a TIF works comes from the businesses getting the tax break, which report their own job numbers each year. Those businesses have little reason to admit they fell short. So, the researchers compared TIF neighborhoods with similar areas that had none.
Incomes rose at about the same pace in both. Jobs grew faster in the TIF neighborhoods, but that did not mean meaningfully higher incomes for the people who lived there.
The researchers concluded that “with little empirical job creation evidence beyond self-reported commitment measurements, policymakers in Franklin County should seriously consider whether the costs of property tax incentives may now outweigh the purported benefits.”
What could Ohio change?
Ohio could ask local officials to make a stronger case before they set aside decades of property tax revenue. Minnesota, for example, requires a city to explain why a project would not happen through private investment alone. Officials must also estimate how much the property’s value would rise without a TIF.
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Schiller suggested requiring a public vote on TIFs above a certain size.
Thomas said Ohio could set clearer, statewide rules for judging whether TIFs deliver on their promises. Once a deal is in place, ending it can be difficult and costly, particularly if it is tied to contracts, borrowing or a legal dispute.
Cuyahoga County’s list shows how rarely these deals end. Of 265 records, only 12 were terminated or expired.
