A redevelopment agency will administer the CRA and is comprised of the City Council. Some cities also elect to have a separate board which helps determine appropriate investments for tax increment. CRAs are helpful tools, including offering the following abilities:
- Facilitate redevelopment of underutilized property through acquisition, clearance, re-planning, and/or sale;
- Investing in core infrastructure, such as utilities, streets, lighting, curbs, sidewalks, landscaping, etc.
- Providing “gap” financing in the form of loans, reimbursements, and property discounts to encourage private investment
An effective CRA requires the participation of the taxing entities that have taxing authority within the defined area. These entities continue to receive base taxes (taxes that are existing prior to creation of a CRA), as well as a negotiated portion of the generated increment. At the end of the CRA life (typically near 20 years), taxes return to the entities in full. All generated tax increment is required to be spent within the defined project area.