Opinion ID: 2521328
Heading Depth: 1
Heading Rank: 2

Heading: the local development act

Text: ¶ 3 The City of Guymon established Tax Increment District No. 1 pursuant to the Local Development Act to generate revenue for financial assistance to Seaboard Corporation in its construction of a pork processing facility in the City of Guymon. The additional ad valorem tax generated by the new processing plant is committed to repayment of a $4.5 million bond issue. ¶ 4 The Legislature stated the purpose of the Local Development Act in 62 O.S.2001, § 851. The Act is used to put into practical effect Article 10 § 6C [4] of the Constitution of the State of Oklahoma. The Act provides for tax increment financing, a method through which portions of ad valorem taxes over a base assessed value may be dedicated to finance costs of approved project plans. Oklahoma City Urban Renewal Authority v. Medical Technology & Research Authority of Oklahoma, 2000 OK 23, ¶ 8, 4 P.3d 677, 682. 62 O.S.2001, § 853(9). ¶ 5 How tax increment financing is used by a city is described in the Oklahoma City Urban Renewal Authority case: Tax increment financing utilizing ad valorem taxes assumes that the assessed property value of the area will increase because of the development project and that, absent the project, property values would not rise. The financing plan is intended to create economically productive property where none presently exists by providing inducements for private commercial development. It allows the capture of local taxes generated by a new development instead of allocating the tax increments to the taxing entities. Oklahoma City Urban Renewal Authority, 2000 OK 23, ¶ 9, 4 P.3d at 682, (footnotes omitted).