Glasgow to borrow £30m to finance city development
Glasgow City Council today approved a proposal to borrow £30m in order to encourage development in the city centre.
The council’s executive committee agreed to a plan to develop a £30m Tax Incremental Finance (TIF) scheme to support the development of two innovation districts.
A TIF scheme uses revenue gained from future taxes to finance the borrowing required to fund public infrastructure improvements that will in turn create those gains.
The two innovation districts identified in Glasgow - the Merchant City and the West End, anchored around the Universities of Strathclyde and Glasgow – have been chosen because they have the characteristics that could bring sustainable economic development in key sectors.
It is estimated that the project will require around £60m of investment from the various partners. Part of the £129m from the Glasgow City Region City Deal will go towards development, but the council intends on borrowing up to £30m through a TIF scheme.
The final business case for this TIF will be brought back to the council’s executive committee for a decision on final approval before the end of September 2017.
Cllr Frank McAveety, leader of Glasgow City Council, said: ‘Glasgow’s traditional role as a home of innovation has been boosted in recent years by a number of projects, and the creation of innovation districts promises to take the city’s status for achievements in sectors such as life sciences, advanced manufacturing and energy to new heights.
‘The development of a TIF scheme for such a district in the Merchant City would bring great economic and social benefits to Glasgow.’