By: Diane Benjamin
This is a little complicated if you don’t understand TIF districts. The basics are:
- An area is declared a TIF in order to revitalize a blighted area
- Money is borrowed for TIF spending, it can be used to incentivize new development
- Tax money raised within the TIF is then used to pay off what is borrowed. Money comes from new sales tax, food and beverage taxes, etc. The increase in property taxes is also used (Tax Increment). Example: A run down property paying only $2,000 a year in property taxes turns into a shiny new building paying $300,000 a year.
Understand TIF’s now so I don’t have to repeat that?
Now that you see what is supposed to happen, let’s talk about what did. I could go into a LOT of detail but I will keep this simple.
I wrote this story on 3/24: https://blnnews.com/2020/03/24/why-did-this-story-get-written/
That story talks about money taxpayers forked over to get the Hyatt and 1 Uptown Circle buildings, I wanted to see what the TIF reports reflect.
The Hyatt and 1 Uptown Circle are NOT in the TIF reports.
See the first 12 pages of the 3/31/19 TIF report filed with the Comptroller: Uptown TIF
In case I was missing something, I asked Pam Reece why the investments in the Hyatt and 1 Uptown Circle aren’t on the report:
Again, I could go into lots of details, but what citizens need to know is:
- PDF Page 8 of the TIF reports shows bonds of $80,600,000
- The $5.1 million given to the Hyatt is not included in the above
- The $2.75 million given to get 1 Uptown Circle built is not included-it is supposedly a loan however. Of course the ridiculous rent for the 2nd floor isn’t included.
Pam’s answer is suspect. TIF’s don’t have funds on their own. Government either borrows money or tosses in some of their own to get handouts to developers started. Obviously the Hyatt and 1 Uptown Circle got handouts, but borrowing thrown to them is not included. It sure makes the TIF report look better leaving out expenses!
The story gets better! Go back to yesterday’s story: https://blnnews.com/2020/03/31/normal-remember-all-those-property-tax-increases/
All of the expenses aren’t on the TIF reports, but property tax revenue is! Remember, once the TIF was established in 2003 all increases to the taxable value of properties and the resulting property tax revenue goes to the TIF.
The 3/31/2019 TIF report shows a tax increment of $2,242,847. I FOIA’d where that number came from. That is why yesterday’s story says 296 properties are paying into the TIF.
See the entire list of properties here: TIF_Uptown_Parcels_-_2017_Payable_2018
The report lists properties by PIN Number, so first you need to know the PIN’s for Hyatt and 1 Uptown Circle. Since both are new buildings located inside the TIF, the entire tax bills go to the TIF unless some agreement is made with other government units to give them some.
Below are the property taxes paid:
Hyatt – 14-28-431-021 Total: $2,003,410, $1,706,519 was considered TIF money
1 Uptown Circle – 14-28-431-022 Total: $67,443, all went to the TIF *** (see below)
Income to the TIF includes $1,773,962 making the TIF look more profitable while the related expenses aren’t included which would have had the opposite effect.
Think of it like this: You own a small business that grosses $1,000,000 a year. People think you must be filthy rich bringing in all that money. They don’t know you had expenses of $960,000 to produce that million.
In Normal’s case that $1,000,000 would have cost them $2,000,000 to generate. (made up numbers just for example!)
I’m far from done with the Uptown TIF. New story tomorrow!
I hope you aren’t lost yet!
*** Government reports are always out of date. Providing current data isn’t a government priority.
1 Uptown Circle wasn’t finished in 2017, therefore the property tax bill was reduced.
The 2018 tax, payable in 2019 was $186,131.84, with $159,492.62 of that going to the TIF.
Those numbers will be reflected on the 3/31/2020 TIF report. We won’t see that report for over 6 months.