RANTOUL — Village officials have changed their mind on seeking to extend the life of a tax increment financing district that is due to expire.
Mayor Chuck Smith and Village Administrator Scott Eisenhauer said at last week’s village board study session that the village planned to seek approval of an extension of Tax Increment Financing District No. 1. But that decision has changed.
Tax increment financing (TIF) is a public financing method that is used as a subsidy for redevelopment, infrastructure, and other community-improvement projects. The process works this way: The tax amounts received by all taxing districts in the TIF area are frozen at the rate at the time of the district’s formation. Then each year the amount above the base level at which the tax rates were frozen goes into a TIF fund. The extra money is used for various projects ranging from road improvement to demolition of properties.
After the life of the TIF district ends, if the entity administering the TIF district — in this case the village — wants to extend its life, it will go to the other affected taxing districts such as schools, townships and junior college districts for their blessing. The extension must then be approved by the state of Illinois.
The village of Rantoul issued the following statement regarding the decision not to seek an extension:
“As of this year, Tax Increment Financing District 1, established after the closure of Chanute Air Force Base, concludes. This TIF district has allowed for the development of much-needed infrastructure, community improvements and services, removal of antiquated facilities, support the development activities, and an expansion of tourism destination locations in our community over its 23 years.
“With significant economic development projects on the horizon in the area around this TIF district, the original perspective was to extend the life of this TIF for an additional 12 years. However, after careful evaluation of what steps the village should take to best position itself for investment in our community, we feel it is best to allow the TIF to expire, allowing those dollars to flow through the respective taxing bodies and continue to work together toward a lower overall property tax rate.
“The incremental value of TIF District 1 has risen $13 million since its inception. These dollars will now be added to the revenue stream of all taxing bodies, allowing them an opportunity to valuate their property tax rates, while still maintaining current funding levels. This is key as we look for ways to entice development around south Rantoul, the interchange, our east side and in the heart of the community, where the downtown lies.
“We also believe this will encourage residential development, bringing more families into our community. We are excited about the opportunities in our near future, and think this is the right step towards making Rantoul an even better place to live, work and play.”
At the study session, board trustees were presented a resolution that they were asked to approve as a show of support for the TIF district extension. The resolution was removed from the agenda of the May 14 regular board meeting.
Eisenhauer said at the study session that TIF money would be used on infrastructure work for the development of two major projects expected to be announced in Rantoul — the 257-acre Illinois Automated and Connected Track expansion at the Illinois Center for Transportation and an unnamed project, both on the grounds of the former Chanute Air Force Base.
He said TIF dollars could also be used for the demolition of properties within the district. TIF District 1 encompasses all of the area originally in the Chanute Air Force Base historical district and part of the South Pointe Commons and Golfview Drive neighborhoods.
“The potential for private development there not only will be needed to improve the infrastructure but also to remove and replace that infrastructure where (it is needed).
One of the projects has a desire to grow to the west, which would mean some demolition of some significantly large structures, one of which would be (the Chanute) hospital,” Eisenhauer said. “There are 600 parcel numbers within the TIF district.”
Smith said in rethinking the decision to seek extension of TIF 1, “We’re trying to consider Rantoul and how successful Rantoul can be moving forward. It wasn’t we feared the lack of support from the other taxing bodies (in the TIF district).”
Smith said he believes not seeking the extension will help the community more.
“If we can do something about reducing taxes with all the other taxing bodies, I think it would be to everyone’s interest,” Smith said.
Still, he said the TIF district has benefitted the community. He listed infrastructure work that was accomplished as a result of TIF funds.
It includes renovation of: Frost Avenue from South Century Boulevard to Doolittle Boulevard; South Century Boulevard from International Drive to Chandler Road; Borman Drive from U.S. 45 to Eagle Drive; Willow Pond Road from Maplewood Road to Golfview Road; and South Pointe Road from Frost Avenue to Collier Drive Also, improvement of Veterans Parkway; Flessner Avenue improvement; and creation of the bike path from the Hap Parker Aquatic Center to J.W. Eater Junior High.
He said the funds were also used on the aquatic center; for police protection; sanitary and storm pump stations; the installation of several roofs to preserve buildings; and the demolition and removal of several buildings.
With no more TIF funds coming in from that district, will the village still be able to do work such as that listed above?
“That’s a logical question,” Smith said. “But I think the answer will be ‘yes,’ because the tax base will increase. The village will benefit as well.”
The village has three other TIF districts that remain intact. The next-oldest after TIF 1 is one in the area of Walmart and Holiday Inn Express. The two others are where the new Shields Auto facility is being built near Walmart, and where Vista Sports is located west of Interstate 57.