By Pat Tepoorten

The possibility of the city of North Branch utilizing Tax Increment Financing (TIF) to promote residential development within the boundaries of the ESSBY project has people buzzing about the possible impact on school district funding.

However, because of the restructuring of the property tax ìpieî under then Governor Jesse Ventura, which placed the burden of per pupil funding entirely on the state, TIF has little to no impact on district funding.

In fact, the only local property tax dollars that go toward school funding in the state of Minnesota are those which are approved through district-wide referendum. Therefore, the use of TIF in a residential area would appear to have no negative impact on the districtís ability to fund the education of an increasing student body. Rather, if using TIF to increase residential population is successful, a school district could enjoy the growth through increased per pupil funding from the state.

Furthermore, residential neighborhoods that may fall within a TIF district are not exempt from taxes dedicated to approved district referendum, be it an operating levy or those dedicated to infrastructure.

In the case of the North Branch school district, which has room for expansion at the Main Street School and recently added the Sunrise River school, the district could enjoy what community relations coordinator Sara Thompson referred to as ìmoderate growthî within its existing facilities, all the while increasing its per pupil funding from the state.

At last weekís school board meeting, Superintendent Rodney Reisnouer estimated moderate growth at 2 percent annually. ìThat is something we can handle,î he concluded.

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