Envisioning Traverse City's Future with TIF 97 Funds Recaptured: Part 1
This is the first in a four-part series exploring how Traverse City can thoughtfully reinvest the funds that will return to our general fund with the expiration of TIF 97. By balancing smart planning with a respect for our small-town character, we can preserve the charm of our historic neighborhoods while making conservative, forward-thinking improvements to housing, infrastructure, and safety - especially for the next generation of residents.
What is TIF 97?
For decades, Tax Increment Financing (TIF) 97 has helped fund projects that made downtown Traverse City the vibrant, walkable center it is today. Created as a tool to capture the increased property tax revenue generated by improvements within a defined area, TIF 97 allowed the Downtown Development Authority (DDA) to reinvest in infrastructure, streetscapes, and public amenities. It played a key role in revitalizing downtown at a time when it was struggling to attract investment.
Why is TIF 97 Going Away?
Like all TIF districts, TIF 97 was never meant to last forever. It was set up with a sunset date, and that time is approaching: TIF 97 will expire in 2027. The goal of a TIF district is to jumpstart growth, and not to necessarily serve as a permanent funding mechanism - I think it’s succeeded! Over the years, our downtown has transformed, and now, as the district nears its natural conclusion, the tax revenues it collected will be redirected to the city’s general fund and other taxing entities, including the county and local schools. This transition is an opportunity to reinvest those funds in a way that benefits all of Traverse City… beyond just downtown.
How Much Money Will Be Available?
Upon expiration, approximately $2.3 million per year will flow into the city’s general fund, with another $1.7 million returning to other local governments and schools. This provides an opportunity to take a step back and ask:
How do we invest these dollars in a way that honors Traverse City’s history, preserves its small-town charm, and improves the quality of life for residents today and in the future?
Where Should the Money Go?
While it’s important to continue supporting downtown infrastructure, we also have a chance to make strategic investments that protect the character of our neighborhoods while enhancing Traverse City’s livability. Here are three areas where these funds could make a lasting impact:
1. Carefully Expanding Housing with ADUs
Accessory Dwelling Units (ADUs) - small, secondary homes on existing residential lots: offer a way to add needed housing while maintaining the character of our neighborhoods.
These units could take the form of a converted garage, a basement apartment, or a backyard cottage - fitting seamlessly into our existing community fabric.
By offering incentives such as simplified permitting, low-interest loans, and pre-approved designs, we can encourage homeowners to build ADUs that provide long-term housing for local workers, retirees looking to downsize, or even family members who want to stay close.
The goal isn’t rapid expansion but conservative, thoughtful growth that keeps housing affordable for those who call Traverse City home.
2. Creating Safe Routes for Kids to Walk & Bike to School
We take pride in Traverse City being a safe and family-friendly community, but as traffic grows, many parents feel uneasy about letting their children walk or bike to school.
Investing in protected bike lanes, safer crosswalks, and connected sidewalks will give families confidence that their kids can travel safely - without having to rely on cars for every trip.
To make this work, we need four dedicated bike and pedestrian corridors that provide safe, convenient routes north-south and east-west across the city. These protected paths would connect schools, neighborhoods, and parks, making Traverse City a leader in safe, sustainable mobility.
A community where children can bike to school is a community that values both independence and safety—qualities we should strive to protect.
3. Investing in Environmentally Friendly Infrastructure
One of the reasons we love Traverse City is its natural beauty - from tree-lined streets to the pristine waters of Grand Traverse Bay - this is one of the main reasons I live here!
As we think about infrastructure improvements, we should focus on solutions that protect our environment while ensuring the longevity of our roads, sidewalks, and public spaces.
Stormwater Management & Flood Prevention – Heavy rains can overwhelm our aging drainage system, leading to flooding and pollution in the Boardman River and Grand Traverse Bay. By using permeable pavement, rain gardens, and bioswales, we can manage runoff naturally while keeping our water clean.
Expanding the Urban Tree Canopy – It’s already pretty great and we can make it even better! Trees not only enhance the beauty of our city but also cool our streets, reduce stormwater runoff, and improve air quality. A strategic tree-planting initiative can help preserve the look and feel of our historic neighborhoods while strengthening our resilience to changing weather patterns.
What’s Next?
Over the next three parts of this series, we’ll take a deeper look at each of these opportunities - how they could work, how other communities have implemented them, and how we can ensure they align with the values of Traverse City.
With careful planning and respect for our town’s character, the expiration of TIF 97 can be a turning point that allows us to preserve what makes Traverse City special while making smart, forward-thinking investments in our future.
Stay tuned for Part 2, where we’ll explore how ADU incentives could help address housing challenges without compromising our small-town feel.
A Note on Funding
While the ideas shared here may seem ambitious, I fully recognize that the $2.3 million returning to the city’s general fund won’t be enough to fund every initiative outright. But these dollars can serve as seed money - important first steps that position Traverse City to pursue additional funding through grants, partnerships, and thoughtful budgeting. The goal is to start the conversation about what kind of future we want to build, and how we can responsibly prioritize the projects that matter most to our residents, our neighborhoods, and our shared quality of life.
Sources & Further Reading
Traverse City Downtown Development Authority (DDA) – Understanding TIF 97 & Its Impact
City of Traverse City – Annual Budget & Financial Reports
Michigan Economic Development Corporation (MEDC) – Tax Increment Financing in Michigan
Smart Growth America – Complete Streets Policy & Implementation
National League of Cities – Accessory Dwelling Units: Policy & Implementation Guide
EPA Green Infrastructure Resources – Stormwater Management & Urban Resilience
American Planning Association (APA) – Urban Forestry & Community Benefits
