Officials in Clarendon Hills hope an upcoming meeting will help clear the air about proposed redevelopment financing along 55th Street that’s generated opposition from other taxing bodies, including three school districts.
A public hearing on a proposed 55th Street Tax Increment Financing district is scheduled for 6:30 p.m. Sept. 16, at the start of a Clarendon Hills Village Board meeting.
Clarendon Hills officials are interested in using a 55th Street TIF District to facilitate redevelopment in a coordinated manner, according to information from the village.
A possible major consideration for the Clarendon Hills officials in considering the 55th Street TIF District is that all three affected school districts — Hinsdale High School District 86, Hinsdale-Clarendon Hills Elementary District 181 and Maercker Elementary District 60 — have expressed opposition.
A Joint Review Board of representatives from those three school districts and other affected taxing bodies voted Aug. 14 to recommend the rejection of the 55th Street TIF proposal. Members of the Joint Review Board expressed concerns about an unequal tax burden, saying there would be a substantial tax shift that disproportionately impacts non-TIF residents. They also highlighted the potential negative impact on school funding from lost property tax revenue.
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.
Despite the Joint Review Board’s input, Clarendon Hills Village Manager Zach Creer said “It’s ultimately the Village Board’s decision.”
“School district opposition seems to focus on philosophical opposition to TIF, generally, rather than the substance of whether or not it qualifies,” he said.
Creer said if the proposed TIF is able to attract the necessary investment to fund infrastructure improvements in the area, village staff expects it will lead to a large amount of investment in the surrounding unincorporated areas, which will greatly benefit the schools.
“This opportunity far outweighs any loss of hypothetical revenues from new construction within the TIF,” he said. “The village has continued to meet with school districts and has proposed what the TIF consultants believe is a very generous revenue sharing agreement.”
Creer said the proposed TIF area in question is 1.84% of District 60’s equalized assessed value, 0.51% of District 181’s and 0.23% of District 86’s.
“So when you start talking about potential revenue from growth, it’s very small numbers, relative to the tax base and overall district budgets, especially if the village agrees to share revenue early, as it has done in the past with the Ogden Avenue TIF,” he said.
The proposed new Clarendon Hills TIF District is 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.
The village already has two TIF districts, on Ogden Avenue, between Richmond and Oxford Avenues, and another in the downtown business district.
Creer said the village has continued to gather information about how the TIF may financially impact the affected taxing bodies.
“That impact is likely very small, given the modest boundaries of the TIF and the lack of new construction that would typically allow the bodies to increase their tax levies beyond what is already allowed under the tax cap,” he said.
The Sept.16 public hearing will include a presentation regarding the area’s eligibility for a TIF district as well as an opportunity for residents and other stakeholders to comment.
Creer is hopeful the presentation will win over doubters.
“Tax Increment Financing has proven to be one of the most effective economic development tools available to Illinois municipalities for financing development and redevelopment,” he said.
Chuck Fieldman is a freelance reporter for Pioneer Press.
