Best Tax Increment Financing Lawyers in Cali

About Tax Increment Financing Law in Cali, Colombia

Tax Increment Financing, known as “Financiación con Cargo a Incrementos de Valor” or “Financiación por Aprovechamientos de las Plusvalías” in Colombia, is a public financial tool used by local governments like Cali to stimulate economic growth and urban development. It involves capturing the increase in property value generated by public investments such as infrastructure improvements or urban renewal projects. The incremental tax revenues from those increased property values are then used to fund further development. This approach helps municipalities upgrade infrastructure, redevelop underutilized areas, and fund essential services without raising general tax rates.

Why You May Need a Lawyer

Navigating Tax Increment Financing in Cali can be complex given the regulatory framework, the involvement of government bodies, and the impact on both public and private stakeholders. You may need a lawyer if you are:

• A private developer wishing to participate in a TIF-funded project
• A property owner affected by new assessments or urban development plans
• Seeking to challenge or appeal a property tax increment
• An investor evaluating opportunities linked to urban modernization zones
• A public entity or association seeking to understand compliance and procedural requirements
• Someone facing expropriation, land use changes, or regulatory adjustments connected to TIF operations

Local Laws Overview

Tax Increment Financing in Cali is mainly regulated under national laws such as Law 388 of 1997 (Urban Reform Law), which empowers municipalities to capture land value increases resulting from public investment. Locally, the City Council of Cali adopts specific agreements and regulations detailing how value capture is calculated, administered, and applied.

Key aspects include:

• Designation of urban planning or renewal zones eligible for TIF
• Assessment of property value increases (“plusvalía”) from public actions
• Calculation formulas for value capture contributions, which differ per project and area
• Legal processes for notifying property owners and involving stakeholders
• Mechanisms for collection, administration, and reinvestment of funds
• Regulatory bodies such as the Secretaría de Vivienda Social y Hábitat (Social Housing and Habitat Secretariat) and the Secretaría de Planeación Municipal (Municipal Planning Secretariat) overseeing implementation

Frequently Asked Questions

What is Tax Increment Financing (“financiación por plusvalía”) in Cali?

It is a fiscal tool that allows the city of Cali to fund urban infrastructure projects by capturing a portion of the increased value of land or property resulting from those public investments.

Who pays the value capture (“plusvalía”) in Cali?

Property owners whose land increases in value as a direct result of municipal action, such as zoning changes or infrastructure improvements, may be required to pay a portion of that increased value to the city.

How is the amount of value capture contribution calculated?

The city conducts land value appraisals before and after development actions. The difference is the “increment”, and a percentage of this increment, as determined by city agreements, is collected as a contribution.

Is value capture a one-time payment or recurrent?

Value capture payments are generally one-time contributions, linked to a specific public action that increases property value.

Can I dispute or appeal a value capture assessment?

Yes, property owners can appeal the assessment by providing evidence or valuations challenging the municipality’s calculation. Legal assistance is recommended for such proceedings.

What happens if I do not pay the value capture contribution?

Failure to pay can result in penalties, interest, and even legal measures against the property, such as liens or restrictions on transfer until the debt is settled.

What types of projects are typically funded by Tax Increment Financing?

TIF is used to finance public works that increase property values, such as new roads, parks, social housing, public spaces, or modernization of utility infrastructure.

How are the funds from value capture used?

The collected revenues are earmarked exclusively for urban development projects within the designated area, ensuring that public investment benefits the community.

What legal documents should I review if my property falls within an affected zone?

Review the specific city council agreements (acuerdos municipales), municipal resolutions, and urban development plans that define the TIF area and calculations. A lawyer can help you interpret these documents.

Do TIF mechanisms affect property taxes beyond the value capture payment?

No, standard property taxes and value capture contributions are separate. However, the increase in property value may lead to updated property tax assessments in future years.

Additional Resources

If you require more information or official documentation, you may consult:

• Secretaría de Planeación Municipal de Cali (Municipal Planning Secretariat): Oversees urban development and fulfills regulatory functions for TIF schemes
• Secretaría de Vivienda Social y Hábitat: Provides guidance on housing and urban planning regulations
• City Council of Cali (Concejo de Cali): Issues local agreements establishing TIF procedures
• Superintendencia de Notariado y Registro: Handles property registration and legal status inquiries
• Colombian National Planning Department (Departamento Nacional de Planeación): Offers information on value capture mechanisms at the national level
• Local bar associations and legal aid clinics specializing in urban and public law

Next Steps

If you believe you might be affected by or interested in Tax Increment Financing in Cali, consider the following course of action:

• Gather all relevant documents related to your property and any notifications from the city
• Consult with a lawyer specializing in urban or property law in Cali to review your situation
• Request clarification from the relevant municipal secretariat about how your property or project may be impacted
• If necessary, file appeals within the legal deadlines should you disagree with any value capture assessments
• Stay informed about new municipal agreements or public works in your area through official bulletins or city websites