RID Explanation (Residential Incentive District)
What are RIDs? RID stands for Residential Incentive District.
Who Creates RIDs? RIDs may be created by a county, city or township, usually for 30 years.
How Does a RID Work? At the time the RID is enacted, the value of the parcel is locked. Any increase in the value from that point on is put on an exempt parcel and owners make “payments in lieu of taxes” on the higher value. Except for “make whole” agreements entered into with school districts, these payments are generally captured by the RID fund.
How is My Property Tax Bill Impacted by RIDs? Because taxes from RID subdivisions are diverted from current levies, a higher tax rate is applied to all taxpayers to collect the voted levy amounts.
Where Does My Tax Money Go if I Live in a RID? If you live in a RID your tax dollars, or more specifically your “payments in lieu of taxes,” are diverted from the levy funds* to infrastructure projects such as new roads, road widening projects, public buildings, etc.
* In most cases, school districts receive their intended dollars.
Why Would a Community Want a RID? The use of RIDs can aid a community’s fight against blight. Depressed areas are redeveloped, the community grows and the local economy is improved.
RID projects create new debt through the issuance of bonds. As the renewed area becomes more valuable, it generates additional money to pay the bonds.
The local government does not have to raise property taxes to pay off the debt but the tradeoff is there are fewer residents to share in the government’s operating expenses.
Helping Taxpayers Understand How Their Money is Used by Local Governments: This information is intended to improve your knowledge of RIDs (which are authorized by Section 5709 of the Ohio Revised Code) and how they affect all taxpayers.
Tax bills are impacted by RIDs even for those who live outside of a RID subdivision because of the necessity to increase tax rates for everyone who lives within the local government.
To determine if you live in a RID neighborhood, reference your parcel ID by doing an address search on our web site. All those who reside in a RID area will have a parcel ending in “R.”
The most RID parcels in Butler County are located in Liberty Township and the City of Monroe.
TIF Explanation (Tax Increment Financing)
A TIF is set up in a similar fashion to the RID's. The only difference is that the exempt parcel established for a TIF is the same as the taxable parcel, except that it ends in a "T".