What is a DDA?
A Downtown Development Authority is a local body created by local governmental ordinance for the purpose of halting, preventing and correcting deterioration in downtown business districts, to create and implement development plans for the District, and to utilize tax increment financing (TIF) for the completion of authorized projects that are part of a comprehensive DDA plan.
The DDA tax increment financing (TIF) mechanism allows for the capture of the incremental growth of local property taxes over a period of time to fund public infrastructure improvements, within a the DDA District.
By borrowing against the future tax increments, the DDA is able to fund large-scale projects, which can lead to new development opportunities within the downtown.
To put it simply, a DDA comprehensively manages a downtown district to maximize its local economy. This can mean a variety of things, and what each DDA does is often dependent on the particular details of the corresponding downtown district.
FINANCIAL TOOLS AVAILABLE TO DDAs
• Tax Increment Financing (an annual report must be submitted
to the municipality and to the State Tax Commission)
• Millage (up to two mills for municipalities with population of
less than one million)
• Special assessments
• Revenue bonds
• Revenues from property owned or leased by the DDA
• Donations and grants to the authority
• Contributions from the local unit of government