Shorewood greenlights TIF district phase 2 study
Brock A. Stein | 8/26/2015, 9:31 a.m. | Updated on 8/26/2015, 9:32 a.m.
The Shorewood Village Board has approved funding for the second phase its Tax Increment Financing district study.
The analysis will finalize details and set a boundary for the proposed TIF district that will encompass 240 acres and 330 parcels in the area centered around the intersection of U.S. 52 and Illinois 59.
The area is included in the village’s riverfront master plan and is considered a gateway to the village.
Rules governing the creation of TIF districts require properties to meet certain conditions in order to be eligible, including land that is economically stagnant or blighted and would otherwise not attract private investment.
That intersection would meet the requirements because the northwest corner, where the former Baba’s Restaurant once stood, has proven difficult to develop despite some interest from developers.
Other factors for a TIF district include buildings with an average age of 35 years or more, areas that lack unified community planning, buildings that show signs of deterioration, vacant structures, and areas in a flood plain.
Once a TIF is created, tax rates are frozen and remain constant within the district for as long as 23 years. During that time, any income from increases in property value that generate new tax revenue is placed in a TIF fund to be reinvested in improvements in the area.
Property tax revenue continues to be distributed to the supported taxing bodies. Taxes generated from the increased property values that are not spent on improvements would be distributed to the taxing bodies at the end of the TIF’s lifespan.
The area being studied has lost about $10 million in equalized assessed tax value in recent years, according to Mary Thompson, of Kane, McKenna and Associates, a Chicago-based consulting firm that has been conducting the study. That makes the area a good TIF candidate for conservation to prevent it from becoming blighted, Thompson said.
TIF district approval can take four to six months, she said, and can include up to 50 steps, including holding public information meetings with residents living in the proposed district. The village’s TIF study area could include up to 75 residential homes.
Other taxing bodies, including Troy Fire Protection District, Troy School District 30C and the Shorewood Public Library, would also be consulted.
While property taxes would be frozen for 23 years, those taxing districts would receive a bump in tax revenue after it expired resulting from the increased value of property through the redevelopment conducted during the life of the TIF district, Thompson said.
Phase 2 of the study is expected to cost up to $27,000, according to village documents.