By: Diane Benjamin
The City issued the following explanation of TIF districts with the budget. See Book 2 – page 85 http://www.cityblm.org/Modules/ShowDocument.aspx?documentid=8223
A Downtown TIF District was formed in 1986. A TIF (Tax Increment Funding) District receives the incremental property tax revenue for properties located within the TIF district boundaries. The incremental difference is the difference in taxes between the value of the properties at the formation of the TIF and the present day value. The City receives all taxes on this incremental portion, not just the City’s share. The other taxing bodies only receive the portion of taxes calculated on the value of the property in the year the TIF was formed or the base year. These funds are reinvested into the TIF area to spur redevelopment.
Tari wants to use new TIF funds for a downtown hotel. He claims no taxpayer money will be used, the entire project would be by a private developer. The below is from the hotel feasibility study the City commissioned: http://www.cityblm.org/modules/showdocument.aspx?documentid=6313 pAGE 12
The study proved a private hotel isn’t feasible, the gap is somewhere between $14 and $17 million. So how will Tari get his downtown hotel without taxpayer money? He won’t.
This article from the Peoria recaps TIF’s: http://www.peoriamagazines.com/ibi/2010/jul/whats-tif-district-and-why-should-i-care
The article claims paying the developer isn’t one of the uses allowed by law:
And just what types of investments can a city make with those TIF funds? The Illinois TIF law contains a list of very specific purposes for which TIF funds may be used, and contrary to some accusations, “kickbacks to developers” is not one of them! Permissible uses for TIF funds include, among others, infrastructure improvements (e.g. roads, utilities), job skills training for workers within the TIF, marketing the area to prospective new businesses, and building new public buildings.
So, how will the millions of dollars funding gap be closed?
Now you know why Tari is waiting until after the April elections to bring it up.
Think Ensenberger’s – it was a TIF.
Elections matter to your wallet. April will be critical.
TIF are like robbery to the other tax entities, such as school districts and depending on where it could include library and fire departments.
I am almost sure in this case school District 87 will have to approve a TIF or a change to an existing one.
A number of years ago, 10 to 15, I was on a IL school district board and we fought the local city over a TIF and won. At that time the city had a developer lined up to build homes on the land. I thought maybe the state changed what a TIF could be used for since then but I am not sure about that.
Ensenberger, what a joke that was. Was it last month the local gossip newspaper had the article on the number of empty condo’s in that building. Gawd who would buy one at those prices and that is even after they reduced the prices. We’re not talking downtown Chicago here too but they wanted almost Chicago prices.
What about the Castle Theatre fiasco? The city loaned Ben Slotky all of that money and he failed on the loan. I don’t remember if TIF money was involved in that or not.
I’m all for nostalgia and trying to retain some history but that place was a dump before Ben took it, When I walked in there when they were having a sheriff’s content sale before Ben took it you had to sign a paper releasing any claim to injury. It was a horrible mess. Leaking ceiling, just a dump. It should have been leveled for a parking lot but the suckers at city hall took the bait and the taxpayers got soaked again.
I wonder who owns the old Montgomery Ward building where they want a hotel at. They would almost have to need the old Commercial Bank building too to get the whole city block.
TIF’s are like robbery to the other tax entities, such as school districts and depending on where it is located it could include library and fire departments.
TIFs are only permitted when all the other taxing bodies sign-off on it. In the case of school districts, the state aid formula adjusts to make up most of the difference. Then, for example, the municipality can make the school district “whole” with the TIF funds via building improvements or other means allowed by law.
TIF districts can be one of the best ways to improve areas of a municipality.
TIF stands for “Tax Increment Financing,” not “Funding.” Just FYI.
It was copied from the budget. Maybe that’s why Bloomington doesn’t have a great track record with TIFs