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Serving the communities in Jo Daviess County

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VOL. 83 • NO. 51

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WEDNESDAY, DECEMBER 21, 2016

Stockton Chamber of Commerce hosts TIF informational meeting By Tony Carton The Stockton Chamber of Commerce and JJ and Freddie’s Restaurant hosted an informational luncheon Dec.14, featuring Sharon Pepin of Community Funding and Planning Services presenting the intricacies of both Tax Increment Financing (TIF) and Business Development Districts (BDD) “I mainly work with municipalities helping them to get money to do infrastructure projects, grants and low interest loans,” said Pepin. “I also help municipalities get the economic tools to help them attract businesses.” Pepin has been in funding and planning services for about 20 years and operates Community Funding and Planning Services in downtown Stockton. “We work with about 25 to 30 municipalities in Jo Daviess, Carroll, Stephenson, Ogle, Whiteside and Winnebago Counties that we work with on a regular basis,” Pepin said. The first part of Pepin’s presentation focused on TIF or Tax Increment Financing districts. Tax Increment Financing is a powerful tool that enables municipalities to self-finance its redevelopment programs.TIF funds can pay for public improvements and other economic development incentives using the increased property tax revenue the improvements generate. TIF is particularly useful to communities where local leaders envision a resurgence of population, a robust local economy and a town capable of providing the varied public services, security and quality of life many young families, workers, business owners, and elderly persons are searching for today. “TIF and BDDs are economic incentive programs that municipalities can create and the purpose behind that is to help them get funding, and earn revenues to either do infrastructure projects or economic development projects or help retain or expand businesses,” said Pepin. Tax Increment Financing is the only local economic development

tool available to Illinois communities and since its inception in 1977, more than 250 Illinois municipalities have created at least one TIF District. Collectively, there are now over 1,000 TIF Districts within Illinois. Currently, most states utilize Tax Increment Financing as a catalyst for needed redevelopment. The success of TIF is a reflection of public and private entities working cooperatively to meet the redevelopment goals and objectives of those municipalities. “A TIF District is a reimbursement from the municipality for a portion of your property taxes that you’ve already paid into and is a municipality’s way of saying thank you for making an investment in our community and we are going to give you back a portion of your property taxes based on a project that you are proposing to do,” said Pepin. She explained that a TIF district is created in a particular calendar year. Property taxes collected prior to that calendar year are paid out to all the taxing bodies in a community. After the TIF is created, if there is any increase in those property values, instead of going to all the taxing bodies that increase in property values goes to the municipality that created the district. “For example, when Stockton created its TIF in 2005 there was roughly 7.5 acres of vacant green space along Highway 20,” said Pepin. “At that time the Equalized Assessed Value (EAV) was $1745, so all the taxing bodies would receive a portion of that $1745. Once the TIF was created and after development occurred on that property (specifically, a new restaurant, gas station and travel rest area) the EAV increased to $235,185 creating $233,440 in TIF increment and generating roughly $16,830 into the Village TIF Fund.” As further development occurred the EAV rose to $416,927 in 2007 creating $415,182 in TIF increment and generating roughly $29,900 into the Village TIF fund. That same, formerly vacant parcel currently sports an EAV of $445,956 creating $444,211 in TIF increment and

generating roughly $42,500 into the village TIF Fund. All taxing bodies still get the property taxes on the $1,745 base EAV from 2005 and all increases in the EAV go to the village which creates a Special Tax Allotment Fund to be used for infrastructure projects within the TIF district or to be used to reimburse private development. There are a number of short and long-term benefits to the creation of a TIF no tax increases while property values increase, TIF funds can be

distributed to finance private investment and development which creates jobs. As the need for qualified workers increases, job training programs spring up leading to job retention and a stronger, broader tax base created by a stronger economic base that is locally controlled, and since the incremental revenue is reinvested in the TIF district investment outside the district is stimulated. It should be emphasized that TIF does not generate tax revenues by increasing tax rates. Rather, TIF

generates revenues by allowing the municipality to capture, temporarily, the new tax revenues generated by the enhanced valuation of properties resulting from the various redevelopment projects. While the maximum life of a TIF District is 23 years which may be extended one time by as much as 12 years, when the TIF ends and the town’s investments in both public and private redevelopment proj-

See MEETING, Page 2

COURTESY PHOTO The Scoop Today

Bank gives back to the community

Brock Musser and Mike Mammoser of Citizens State Bank present a check to members of the Stockton High School Chapter of the Highland Community College Servant Leadership program for the groups’ SNOW project which provides supplementary nutrition for elementary school children in Stockton.

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