Township Financing FAQs
1. How are Townships funded?
Townships are funded primarily through property tax levies. Unlike counties that may levy both a property tax and a sales tax and municipalities that may levy a property tax and income tax.
2. What is a Residential Incentive District (RID)?
A RID is legislation enacted by a local government to help pay for public improvements. A RID allows a local government to divert a portion of property tax receipts to pay for specific infrastructure and public improvements. The taxpayer whose property resides in a RID pays the same amount in taxes as they would if the RID were not in place.
3. What is a Tax Increment Financing District (TIF)?
A TIF is legislation enacted by a local government to help pay for public improvements. A RID allows a local government to divert a portion of property tax receipts to pay for specific infrastructure and public improvements. The taxpayer whose property resides in a TIF pays the same amount in taxes as they would if the TIF were not in place.
NOTE: The most significant difference between and RID and TIF is one is a RID is residential and a TIF is typically commercial.
4. What is a Joint Economic Development District (JEDD)?
A JEDD is an arrangement where one or more municipalities and a township agree to work together to develop township land for commercial or industrial purposes. A JEDD permits a regional approach to economic development. Individuals working within the JEDD as well businesses operating in the boundaries are subject to an income tax.
Liberty Township residents are not subject to this income tax unless they work within the JEDD. Liberty Township currently has a JEDD in place today – more information may be found online.
5. Hasn’t the commercial development around I-75 brought in a lot more revenue?
The development in Liberty Township that has occurred around I-75 has had limited impact on Township revenues with regard to property taxes. This area is currently in a Butler County TIF until 2032, therefore any increase in property tax value goes directly to Butler County. The Butler County TIF revenue has helped pay for the Liberty Way Interchange and is committed to future infrastructure improvements in the TIF area.
Liberty Township does have a JEDD in the area around I-75, and therefore receives income tax revenue from those working and doing business in the area. These funds are committed to the Liberty Interchange and Liberty Way debt obligations.