Those cities give a part of the increased taxes to the developer to offset some of the cost and risk as a real incentive to build in distressed areas. The concept is known as Tax Incentive Financing (TIF). Winnipeg has not yet embraced the concept.

The idea is not complicated. A specific area is identified as distressed, or "blighted" It is concluded that "but for" extensive incentives, development will not occur in that area, which is labeled a Tax Incentive District (TID). A commission is appointed to develop a plan for the TID and do financial projections. The financial projections determine how much taxes will increase in the TID if developed according to the plan.

TIF has been used extensively for over 50 years and is common in 47 U.S. states, and to some extent in other Canadian provinces. It doesn't require a lot of new legislation or new bureaucracy. It is not "corporate welfare" because the end user doesn't get a tax reduction. Taxes are paid on the new development at the same rate as anywhere else in the city. It is just an efficient and productive method of creating an incentive to building in otherwise unattractive areas.