Two areas of Fort Dodge should be added to an urban renewal area so that tax increment financing money can be used there, the city’s Plan and Zoning Commission recommended Tuesday.

One of those areas is on the south side of Third Avenue Northwest between Fifth and 10th streets northwest.

The other area is just north of downtown. It is bordered by Seventh Street to the west, Dakota Street to the north, 10th Street to the east and the alley that runs between First and Second avenues north on the south. The city government is buying rundown, vacant houses in that area and having them demolished.

The areas must be in the urban renewal area in order for tax increment financing to be used there. Tax increment financing occurs when increased property tax revenue from a designated area is set aside to pay for projects within that area. Often, the city government borrows money to do the projects, then pays off the debt with the tax increment finance revenue.

The City Council will now decide if those districts should be included in the urban renewal area.