Sycamore City Council gives go-ahead for firm to look into creating second TIF district

Sycamore City Council approved a St. Louis-based contractor for feasibility study before possible TIF creation

Sycamore City Hall Council Chamber in Sycamore, IL

SYCAMORE - Another tax increment finance district could be coming to Sycamore, as the city council gave its go-ahead to conduct a feasibility study for the proposed TIF on the north side of town.

The Sycamore City Council voted, 6-0, during the Tuesday meeting to approve hiring St. Louis-based PGAV Planners – the same contractor that the Sycamore city officials used when the first TIF district was created in 2000 – for $29,000 out of St. Louis to conduct a feasibility study on the proposed TIF district. Second Ward Alderman Chuck Stowe and Fourth Ward Alderwoman Virginia Sherrod were absent from the meeting.

If the contractor recommends creating the proposed TIF district and the city creates it, it would be the second of its kind to exist in Sycamore, Acting City Manager Maggie Peck said. The proposal comes after city officials approved to close the first TIF district on Dec. 31, 2021 instead of the originally slated date of Dec. 31, 2024.

Peck said members of affected taxing bodies previously expressed support in moving forward with the feasibility study. She said representatives from the contractor commended the city for its appropriate use of TIF districts.

“Closing a TIF early is not historically heard of,” Peck said.

According to Sycamore city documents, the proposed area for the TIF district – which city officials are calling the Tax Increment Redevelopment Project Area No. 2 – includes properties along portions of North Cross Street, Lucas Street to North Avenue and one block over Main to Page Street.

The study would include a redevelopment area map, estimated redevelopment project costs, a general land use plan, existing conditions map, a parcel key map with information on property owners in the proposed zone, and a report with trends for equalized assessed values, which are the property tax metrics used in TIF districts to create revenue.

Peck said there was no specific catalyst that prompted the possible creation of the new TIF district in the city. She said it’s something city officials have been looking into for a while as residential development growth continued on the city’s north side and those residents have expressed support in the proposal.

“That’s where we need to give attention to at this time,” Peck said.

An illustration of Sycamore's newly approved tax increment financing district, designated as "TIF 2".

According to the Illinois TIF Act, municipalities and taxing bodies can create a TIF district over a specified geographic area. At the time the TIF is created, the value of property in the area is established as the “base” amount, and taxes paid on that amount continue to go to taxing bodies as normal.

Over time, as development occurs and property values rise, the city collects the additional property tax revenue created from new development and increased property values, known as increment, which must then be invested back into the area for redevelopment. The money can go toward fixing blighted areas and paying for infrastructure, the costs of jobs related to the TIF district, surveys, environmental reviews needed for development and more.

Referencing city documents, Peck said TIF districts are a useful tool that help redevelop areas “in need of revitalization and investment.”

“And a lot of those buildings need that revitalization,” Peck said of the buildings within the proposed TIF district boundaries.

Following the council’s vote, Peck said next steps include seeing what the contractor would recommend in creating the potential TIF district and reaching out to affected taxing bodies. She said those taxing bodies also would have to vote on whether to approve the creation of the new district.

“And from there, then we would bring it to council for approval,” Peck said, “and move forward in that time.”

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