The city of Crystal Lake is considering creating a special tax district for Water’s Edge, a redevelopment project that could replace Crystal Court, a nearly empty strip mall off of Route 14.
The Crystal Lake City Council set a date of June 21 for a public hearing on creating the tax increment financing district at its meeting this week. The public hearing is one of the first steps in the process, which if it moves forward, will ultimately require final approval by the council.
A redevelopment plan for the site, which the Planning and Zoning Commission recommended to move forward to City Council last month, include 271 rental units, a grocery store, new retail and restaurant space, and a hotel.
The Water’s Edge name is a reference to the adjacent Three Oaks Recreation Area.
Part of the requirements for an area to be designated a TIF district include identifying the area as blighted. In this case, the combination of deteriorating buildings, vacancies and declining property values at Crystal Court meets the state’s blighted standards, according to a draft of the TIF redevelopment plan and program.
“Through public investment, the area will become attractive to private investment,” according to the document. “The project area would not reasonably be redeveloped without the use of” revenues generated by a TIF district.
The Crystal Court site is a “unique property” that might not see redevelopment without the TIF designation, community development director Katie Cowlin said.
A TIF district works by freezing the property value local governments collect property taxes off of at current levels. Taxes collected off any new property value created within the district are then put into a fund to be used for projects within the district, such as economic incentive agreements or infrastructure.
One objective of the city’s plan would be to increase the share of businesses within the area that generate sales tax, according to the report. It also is likely the city would use TIF dollars and transfer some of its property to the redeveloper to create access to the Three Oaks Recreation Area from Route 14 via an intersection with a traffic signal.
The city expects to spent $20 million to redevelop the project area, according to the plan, which did not itemize what that money would be spent on, and that upon the completion of the projects, the taxable property value would increase by about 800%.
“This is a working draft that will be refined and finalized for the City Council’s review after the public hearing,” Cowlin said in an email Thursday.
Crystal Lake-based Community High School District 155 officials met with Cowlin on Tuesday to discuss the potential impact and better understand the proposals, said the district’s chief officer of finance and operations, Kevin Werner.
The district is hoping for more details on the tax impact and project timelines, as well how to access TIF financial relief for future students enrolled in the district who may live in the Water’s Edge apartments, Werner said.
When a TIF district has residential as a component, there is a state formula based on how many children are living there for returning TIF revenues to school districts, Cowlin said.
An attempt to reach Crystal Lake Elementary District 47 officials was unsuccessful.