GASB 77 Resources

Starting with audits completed for FY 2016-2017, entities which have tax revenues diverted from them to pay Tax Increment Finance (TIF) abatement agreements will need to report the amount of this diverted revenue. To help facilitate communication of these amounts between TIF users and their affected local taxing authorities, the Department of Management and Auditor of State's office have created the tools below.

GASB 77 REPORTING LETTER GENERATOR - FY2017 (for use disclosing Chapter 403 Urban Renewal/Tax Increment Financing agreements)


GASB 77 CHAPTER 404 TAX ABATEMENT CALCULATOR & LETTER TEMPLATE (for use with Chapter 404 Urban Revitalization tax abatements)


​Below is a recoreded webinar from Department of Management and Auditor of State about the GASB 77 rule and how it will effect local governments in Iowa.  Also covered is the function of the GASB 77 disclosure tools above.


While most Governmental Accounting Standards Board (GASB) Statements only impact cities which are required to prepare financial statements, GASB Statement No. 77 (GASB 77), Tax Abatements, is an exception.  Every city which makes payments during the year ending June 30, 2017 on tax increment financing (TIF) development agreements, rebates or grants will play an important role in implementing GASB 77.

GASB 77 requires governments to disclose in the notes to their financial statements the amount of revenues they promise to forgo through agreements with individuals or entities which promise to take specific actions after the agreements have been entered into that contribute to economic development or otherwise benefit the governments or the citizens of those governments.

GASB 77 also requires governments to disclose in the notes to their financial statements the portion of revenues which the government would have otherwise received that other governments have promised to forgo through their tax abatement agreements.

A Task Force composed of government finance officers (from cities, schools, counties and the state) as well as individuals from the Iowa Department of Revenue, Attorney General’s Office, Department of Management, Office of Auditor of State and representatives of the Iowa Society of Certified Public Accountants met several times to develop an effective and efficient way to implement the requirements of GASB 77.

For cities and counties, the primary types of transactions which will require disclosure are (TIF) development agreements, rebates or grants.  A tool has been developed to assist cities in collecting and providing the information needed to disclose the tax abatement information in the government’s financial statements.

By entering the unique urban renewal area number and the amount of rebates and grants paid during the year, the tool identifies the governments impacted and calculates the amount of revenue foregone by each of those governments. The tool also generates letters communicating the required information to the impacted governments.

This tool is available on the Department of Management web site and other locations to be determined.  The tool was also demonstrated at the IMPA training event on July 27th in Ames.

Q. We are a small city that is in the “Pool” for examinations. What do we need to do for GASB 77?

A. The trigger for GASB 77 is the city’s use of tax abatements related to rebates of Tax Increment Financing (TIF).  If your city has paid tax abatements to an entity during the year from TIF revenue divided during the year, you will need to use the tool to send letters to all of the other governments impacted by your tax abatement.

Q. Do we have to send a letter if we did not pay for any rebates during FY 17?

A. Yes, you should send a letter to each of the taxing jurisdictions even if the amount for them is zero. This will document that you have complied with the requirements for all jurisdictions impacted by GASB 77.

Q. Do charter schools and private schools need to get GASB 77 compliance letters?

A. No.  They receive money only through payments from taxing authorities.  Since they do not directly receive tax, they are not covered under GASB 77.

Q. Where can I find this GASB 77 Calculator tool?

A. The tool is available on the Department of Management’s web site:

Q. Does the GASB 77 Calculator tool adjust for the school protected levies (PPEL and ISPL)?

A. Yes, the calculator tool does adjust for both school levies by taxing authority.

Q. Does the GASB 77 Calculator tool include the LMI requirement?

A. The LMI requirements are not reportable under GASB 77 reporting requirements because they are used by the city and not an outside entity.

Q. GASB 77 requires that each active taxing authority that uses tax abatements send letters to each taxing authority impacted. Does that mean we will get letters from the County if they use tax abatements/rebates?

A. Yes, the city may receive letters from the county  that uses tax abatements or rebates. (See GASB 77 calculator tools to see who you need to send letters to and who will send you letters.)

Q. Is there a template for the letters we need to send to the other taxing authorities?

A. Yes, the letters are generated by the GASB 77 calculator tool. The city needs to fill in the numbers on the Summary tab, enter the name of the city contact person on the Letters tab and print out the letters generated on that worksheet.

Q. Why are some of the lines on the GASB 77 calculator red while others are black?

A. The black lines indicate active TIF districts that receive increment in FY 17. The red lines are for those districts that are active but did NOT receive increment in FY 17.

Q. Does the City Council need to take any action on the calculation before the letters are sent to the other taxing jurisdictions?

A. No, the Council does not need to take any action.

Q. Can the letters be emailed rather than mailed through the US Postal Service?

A. Yes, you can email them. It is recommended that you also keep a copy of each letter to document when the letters were sent out and to whom. It is also recommended that you save the entire file to verify the calculations used for the city’s auditors.

Q. If a city has tax abatements under Iowa Code Chapter 404, are those amounts to be calculated and included?

A. Tax abatements under Iowa Code Chapter 404 are only included IF the Council must approve an application or contract PRIOR to the project eligibility for the tax abatement. These calculations are not included in the GASB 77 calculator tool as few cities have this prior approval.

Q. Our city now has a unified TIF area. Shouldn’t it be on the calculator as one district?

A. Yes it should. If there is a problem call the Department of Management at 515-281-3705

Q. Should the total of the amounts listed on the letters to the other taxing authorities match/tie to the total that is put onto the Summary tab.

A. The total amounts on the letters may not match/tie to the amount entered on the Summary tab because not all entities are audited. Only audited entities need to receive a letter.

Q. When it is time for the city to prepare the audit, is there a sample note disclosure for cities.

A. Yes, the sample note disclosures can be found on the Auditor of State’s web site in Note 14 of the Sample Cash City report [starts on page 35 (Word version) or 36 (PDF version)] or Note 15 of the Sample GAAP City report (page 58). City exam reports do not include tax abatement information.

Q. What happens when you have areas of a TIF district pulled out and made into a new district – is this reported by the county auditor? I suspect this is a difference between an URD and an increment area?

A. All changes to TIF taxing districts must be made through the County Auditor.  The County Auditor will then make the appropriate changes in our valuation system, which will flow in to this GASB 77 disclosure tool.


 Q. What happens when you have TIF districts that are actually overlapping per the legal descriptions?

A.  The legal descriptions should be updated to clear the issue of overlapping TIF districts.  This should be coordinated through your legal counsels and the County Auditor.  The GASB 77 disclosure tool is built out of the taxing district information reported by the County Auditors, so any changes they make will be reflected in this system.

Printed from the Iowa Department of Management website on September 21, 2017 at 5:57pm.