Redevelopment is a set of tools provided under state law, Title 17C of the Utah Code, that empowers local governments in economic development, job creation, blight elimination, and in achieving the goals of development, reconstruction, and rehabilitation of residential, commercial, industrial, and employment districts. Municipalities and counties are authorized to create redevelopment agencies, also known as Community Reinvestment Agencies, to use these tools.

A "redevelopment agency" is an entity authorized by the State of Utah that implements the development goals of communities and is governed by state statute. There are more than 90 such agencies representing cities across Utah. The Taylorsville Redevelopment Agency is one of those agencies and invests in redevelopment projects and programs that shape and better our community. A focus of redevelopment is to accelerate and enable programs, partnership, and actions that encourage, enhance, and leverage private sector investment.

Redevelopment is a term that has a long history in Utah, over 50 years now, with many updates and clarifications in the Utah Code over the years. The 2006 Legislature made major code changes that divided "redevelopment" into three different tracks:

Urban Renewal, Economic Development, and Community Development. Each of those three tracks served a somewhat different purpose. The same legislation also changed the legal name of agencies from "Redevelopment Agencies" to "Community Development and Renewal Agencies," but many Agencies across the state still go by the historical nomination of Redevelopment Agency, or RDA. 

1. Urban Renewal is track/tool for what was historically redevelopment. The goal of Urban Renewal is to eliminate blight from specific areas within the community.


2. Economic Development is a track/tool that is used to help promote job growth in the community. The redevelopment agency can use tax increment to help encourage business relocation, expansion, and development through incentives targeted toward the creation of high-quality jobs.


3. Community Development is the track/tool that allows redevelopment agencies to encourage a variety of development that the community believes will be beneficial, including mixed-use developments. Taylorsville City's active RDA Project areas were created under this code section, using the Community, Economic, and Urban Renewal Development options. 

Examples of redevelopment tools and actions: 

• Ability to assemble land for development
• Ability to utilize tax increment and issue bonds
• Ability to invest in infrastructure to assist private enterprise
• Ability to increase affordable housing stock

Legislative changes in 2016 and then clarified in 2019 eliminated the three previous tracks of redevelopment, consolidating those into a single Community Reinvestment Agency program. One major result was the elimination of the taxing entity committee, which was replaced with tax increment sharing as agreed to in written and approved interlocal agreements between an agency and one or more affected taxing entities. 

Redevelopment Agencies use redevelopment powers and tools as a catalyst in revitalizing their communities. Redevelopment encourages new development, new jobs, and new tax generation in declining urbanized and other targeted areas by developing partnerships between local governments and private entities. 

Redevelopment can help a community implement a revitalization effort for downtowns, commercial areas, neighborhoods, or industrial areas. Redevelopment plans are locally created and adopted so they can respond to a community's unique needs and vision. 

Redevelopment plans can help communities to: 

• Attract new jobs and businesses
• Create more affordable housing
• Stimulate private reinvestment in local neighborhoods and businesses
• Reduce crime
• Stimulate development of improvement programs
• Stimulate private investment and help rehabilitate homes and businesses
• Build or improve roads, utilities, and public facilities
• Preserve open space 
• Transform hazardous waste sites (called brownfields) into productive uses
• Create, adopt and/or implement specific plans Initiate and fund comprehensive planning efforts

The Redevelopment Agency, also known as a Community Development and Renewal Agency, is a separate, distinct legal entity from the City. In Taylorsville, the City Council also serves as the governing board of the Agency. The Redevelopment Agency can utilize city staff or hire its own staff and advisors to carry out its day-to-day operations as well as to help formulate and implement redevelopment plans. 

The benefit of this system is that the Redevelopment Agency is ultimately responsible to the voting public through the elected governing body that oversees the Agency. 

Redevelopment activities may include the
rehabilitation/reconstruction of existing structures, the redesign/re-planning of areas with inefficient site layout, the demolition and clearance of existing structures, the construction/rehabilitation of affordable housing and the construction of public facilities including, but not limited to, public buildings, streets, sidewalks, sewers, storm drains, water systems and streetlights. All of this contributes to the general economic revitalization and vitality of an area, making it more attractive for additional investors and businesses. 

Through redevelopment, a project area receives focused attention and financial investment to reverse deteriorating trends, create jobs, revitalize the business climate, rehabilitate, and add to the housing stock, as well as gain active participation and investment by residents and local business which would not otherwise occur. These revitalization efforts have positive effects that spill over the project area boundaries and improve the entire community. 

Examples of activities/benefits generated through redevelopment: 

• Commercial mixed-use projects
• New or rehabilitated affordable and market-rate housing
• New and revitalized schools
• Increased investment in the area
• Quality job creation
• Transportation facilities
• Sales, hotel, and utility tax revenue
• Youth recreation and service centers
• Community beautification
• Renewed civic pride

The project area is an officially adopted boundary in which actual redevelopment will take place. The project area must first go to public hearing (giving citizens who will be included in the project area a chance to express their views) after which the Redevelopment Agency acts on the adoption of the project area and becomes primarily responsible for future projects. 

Before a project area is established, a survey area is designated to determine whether or not a redevelopment project is feasible or warranted. Preliminary studies, such as feasibility studies, are conducted to make a determination of the conditions within the area. 

Based upon this evaluation, the Redevelopment Agency selects a project area and indicates how the purpose of the Community Development and Renewal Law can be attained by redevelopment of this area. A project area can be reduced in size prior to adoption of the redevelopment plan, but cannot be enlarged without amending the survey area. A project area can also include non-adjacent properties. 

Redevelopment is primarily financed by tax increment revenue, which are the additional new taxes generated above those generated in the base year. Other revenue sources include loans, grants, and issuance of bonds.

Typically, agencies use tax increment funds to leverage financial assistance from various agencies of the state and federal governments, and most importantly from private sources.

The most common bond instrument used by redevelopment agencies to finance projects is called a tax increment bond or revenue bond. These bonds, which are a loan of money to an Agency, are not a debt of the community or the general taxpayer. Rather, they are repaid solely from tax increment revenue generated within the project area. In other words, increased tax revenues generated through redevelopment activities are reinvested back into the project area to stimulate more development as well as to pay the approved costs. 

Tax increment is the primary source of revenue that redevelopment agencies have to undertake redevelopment projects. It assumes that a revitalized project area will generate more property taxes or sales taxes than were being produced before redevelopment and that would be produced without a project area. When a redevelopment project area is adopted, the current assessed values of the property within the project area are designated as the base year value. Tax increment comes from the increased assessed value of property, not from an increase in tax rate. Any increases in property value, as assessed because of change of ownership or new construction, will increase tax revenue generated by the property. This increase in tax revenue is the tax increment that goes to the Agency. 

For example, a property owner pays $1,000 on land assessed at $100,000 this year. If, as a result of new construction on the property, the property increases in assessed valuation to $500,000, the property owner would pay $5,000 at the same standard tax rate. The $4,000 in tax increase is called "tax increment." Redevelopment agencies are entitled to collect this increase in property tax revenues, or tax increment, on the acreage they redeveloped to repay the debt involved in the project, and to reinvest these dollars in redevelopment activities within the project area. In most project areas, well, 20 percent of the tax increment money goes into a housing fund set aside specifically to finance low- to moderate­-income housing. Sales tax increment may also be used, if agreed to an interlocal agreement with a taxing entity. 

The Redevelopment Agency has no power to set tax rates or levy property or sales taxes. Property tax on properties or sales taxes on goods or services purchased within a redevelopment project area is governed by the same laws as on properties outside redevelopment project areas. 

When redevelopment activities are successful, the property values within and around the redevelopment project area increase over time due to the rehabilitation and/or new construction of buildings within the project area. Thus, property tax increment revenues are the result of the rise in property values, not an increase in tax rates. Sales tax collections increase due to the rise in new retail locations or increased sales and traffic at the establishments. The changed image and improved economic base increase the ambiance, vitality, and marketability of property and businesses in the area. Redevelopment activities can enhance the marketability of properties. 

Taxing entities such as the county, school districts, and special districts that serve the project area continue to receive all the tax revenues they were receiving the year the redevelopment project was formed (the base year). Also, taxing entities may receive a portion of the incremental increase in property tax revenues from a redevelopment project area, if adopted as part of the project area budget and interlocal agreements. 

No redevelopment projects occur without taxing entity approval. Prior to 2019, for Urban Renewal, Community Development, and Economic Development projects, the taxing entities are represented by a taxing entity committee that reviews and, in its discretion, approves project area budgets. The taxing entity committee's approval was required before the Redevelopment Agency could collect any tax increment. 

Under the current Community Reinvestment Act, the Redevelopment Agency does not convene a taxing entity committee. Instead, the Redevelopment Agency works independently with each taxing entity located within the project area. The Redevelopment Agency and each taxing entity may approve an interlocal cooperation agreement giving the Redevelopment Agency a portion of tax increment generated in the Community Reinvestment project area from that taxing entity. Additionally, any retail components of a project area are limited and must be ancillary to the primary uses and goals of the project area plan. 

A multi-step process must be followed to adopt a community reinvestment plan and budget. The main elements include: 

1. The agency board adopts a resolution designating the project area that includes a description, survey area, map, and directing a plan and study to be conducted. 


2.  The agency conducts a development impediment study, and the Board must find that there is a development impediment determination.


3. The agency prepares a community reinvestment plan and project area budget describing the development project and goals to be accomplished as a result of the Agency's participation. 


4. All taxing entities, the public, and other interested parties have the opportunity to review and consult with the agency on the proposed plan and budget. 


5. The agency board holds one or more public hearings to obtain comments and suggestions on the proposed plan and budget. The agency board may then adopt, adopt with modifications, or reject the plan. Adopting the plan establishes the project area. 


6. The agency submits the approved plan and budget to the city council for its consideration and action. 


7. The agency provides notice of the plan's adoption and provide for a 30-day notice period. 


8. Negotiate and then enter into interlocal agreement(s) with affected taxing entities for the use of each entity's tax increment. Each agreement will detail how each taxing entity will participate in a portion or all of its tax increment created in the project area.