The Clarendon Hills 55th Street Tax Increment Financing district has been approved by the Village Board after being scaled back in response to objections from affected school districts.
As originally proposed, the new Clarendon Hills TIF District was generally located along the north and south sides of 55th Street, between Western Avenue to the west and Holmes Avenue to the east, and also includes certain parcels on the east and west sides of Western Avenue and Bentley Avenues, and the west side of Virginia and Clarendon Hills Avenues, all south of 55th Street. The uses within this area are commercial and residential, and all TIF funding comes directly from the property owners within the district.
Clarendon Hills officials hope implementing a 55th Street TIF District will facilitate redevelopment in a coordinated manner.
The three school districts that would be affected by a 55th Street TIF — Hinsdale High School District 86, Hinsdale-Clarendon Hills Elementary District 181 and Maercker Elementary District 60 — all expressed opposition to its creation during the process.
Village Manager Zach Creer said he, village President Eric Tech and Trustee Omar Chaudhry “spent a lot of time working with the school districts.”
“I believe we can still meet the development and infrastructure needs of the area with the amended TIF,” Creer said. “However, it will be more challenging. The village would never want to do something that adversely affects the school districts, so the Village Board was sympathetic to their needs. In my opinion, this is the best outcome and preserves the relationships between the school districts and village.”
At the request of the Village Board, village staff reduced the size of the TIF and engaged the impacted school districts in additional compromises under the proposed intergovernmental agreement, Creer said.
He said the village reduced the size of the TIF by removing Jewel and PNC Bank and also added 100% surplus to most properties within the proposed district to the intergovernmental agreement, along with reducing the TIF Budget by about $12.5 million.
The agreement also allows the districts to get reimbursed “at a school district-suggested rate for any students generated,” Creer said. “These actions are a significant reduction of impact on the school districts and a more targeted approach to development goals.”
Creer said the smaller TIF can still be effective in encouraging development and addressing the infrastructure deficit in the area if redevelopment occurs as expected at the former Tracy’s Tavern site, 401 55th St., as well as a site at 5506 Virginia Ave.
“However, the sales tax generated will need to be allocated to these infrastructure needs, as the expected property tax diversion from the new development is now too small to fund the entirety of the projects,” he said. “The village will also need to secure federally- and state- subsidized loans, which staff believe are obtainable.”
Moving forward, Creer said village officials are hoping to have a developer come forward in the spring with a proposal for the former Tracy’s Tavern Site, along with a plan to improve the intersection at 55th Street and Western Avenue.
“We are looking forward to meeting the objectives of the 2017 55th Street Sub-Area Plan now that we have this funding source in place. I think this area will greatly benefit from the increased attention and investment,” he said.
When a TIF district is created, the value of the property in the area is established as the base amount. The property taxes paid on this base amount continue to go to the various taxing bodies as they always had, with the amount of this revenue reduced only if the base declines or the tax rate decreases. It is the growth in the value of the property over the base that generates the tax increment, which is what is collected into a special fund for use by the village to make additional investments in the TIF project area.
Chuck Fieldman is a freelance reporter for Pioneer Press.
