Naples will apply to create two tax increment finance zones in town after voters supported the application Monday night.

The proposed zones are located along the Naples Causeway area, as well as the Route 302 corridor which lies beyond the Causeway area, closer to Route 35.

The projected revenue the town stands to earn by creating these zones is $5.4 million in the Route 302 corridor area, and $2.2 million in the Causeway area, over the next 25 years.

The vote in favor of the zones came after Noreen Norton of Eaton Peabody Consulting Group explained how funds earned from the zones can be used to make improvements and enhance town services to around 40 people at the meeting.

Tax increment finance zones are created to hold money from future residential and residential property tax increases above the current value. Money in the fund can then be used to pay for projects within the zone.

“You can let that money build, or you can use it incrementally for projects associated with the town on a year-to-year basis,” said Norton.

Also, the increases in property values within tax increment finance zones are shielded from tax increases paid by Naples to Cumberland County.

Without these sheltered areas, Naples stands to lose more education subsidies provided by the state, since these are provided based on the valuation of the town.

Casco designated a tax increment finance zone several years ago, said Casco Town Manager Dave Morton. Micah Niemy, the economic and community development director for Bridgton, said the town applied for a tax increment finance zone, much like those proposed in Naples, last August. Bridgton is waiting to hear whether the state accepted its application.

Selectman Rick Paraschak said creating the zones, like neighboring towns have done or plan to do, is necessary in order to avoid shouldering the tax burden for School Administrative District 61.

“Once they start protecting their values, if we don’t, that means we’re going to be paying a larger share (than other towns in SAD 61),” said Paraschak.

Daniel Stevenson, director of tax incentive programs for the Maine Department of Economic and Commmunity Development, said the deadline for applications is March 1. The state needs 30 days for the review and approval process, and decisions must be made by April 1.

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