The economic decline has put a road block in front of Bowling Green’s downtown redevelopment plan.

The Tax Increment Financing district, or TIF, offers a tax incentive for new businesses and current businesses that hire new employees or expand, Commissioner Bruce Wilkerson said. Those businesses will get back any taxes they have to pay that go over the amount of base city taxes on the business when they open, hire new employees or expand.

“The extra revenue that is generated is rebated back to them, so, in a sense, the development pays for itself, “ Wilkerson said.

TIF was approved by the mayor and city commissioners in June 2007. The plan called for $200 million in taxes to be collected over 30 years to pay for the project, he said.

Projects planned within TIF include a downtown parking garage that Western will lease parking spots from, a performing arts center, a hotel and alumni center near Western and the Bowling Green Ballpark, which houses the Hot Rods minor league baseball team. The ballpark was the first TIF development.

In 2008, the city sold $25 million in bonds to build the baseball stadium, guaranteeing the team would come to Bowling Green and begin the redevelopment. The city planned to repay those bonds with tax revenue from other TIF developments.

But Mayor Elaine Walker said many private investors once claiming interest in redeveloping parts of downtown have backed out. Now, she said she’s worried the city won’t be able to repay the bonds.

“My concern is that we’ve had no new development,” Walker said.

Bond sales raised money for the city to initially pay for the ballpark’s construction, but will have to be paid back with either tax revenue from other projects or state funding, she said.

The state government will pay for about 84 percent of TIF after the city collects $150 million in tax revenue, Wilkerson said.

State legislature lowered the amount of required tax revenue from $200 million in March, according to kentuckyvotes.org.

Wilkerson said the only TIF area with developers that are ready to start construction is near Western’s campus. Plans there include a bookstore, an alumni center and a hotel, which Western’s Student Life Foundation, Western’s Alumni Association and Musselman Hotels plan to build.

Walker said more areas need to start developing in order for TIF to benefit the city.

“We’ve got a good thing in the TIF,” she said. “We’ve got the foundation for what could be a very good thing for the city, but it requires an experienced, well-versed master developer with a strong track record to make it work.”

Reporter Christina Howerton contributed to this story.