Dixon council approves $2.2 million TIF loan for Gateway Project infrastructure

City buildout will total $5.2 million

Earth moving as part of the Gateway Project as seen from Bloody Gulch Road in Dixon on April 18, 2023.

DIXON – The Dixon City Council approved a $2.2 million loan for the Gateway Project infrastructure buildout that will be repaid by revenue from the Fargo Creek tax-increment financing district.

The Gateway Project is a commercial development bringing gas stations, restaurants, a hotel and the new Dixon Family YMCA child care center to the Interstate 88 corridor.

The 27-acre site along South Galena Avenue across from Walmart between Keul and Bloody Gulch roads broke ground a year ago with the plan to construct a dozen buildings. It’s expected to create more than 600 jobs and $1 million a year in new tax revenue.

The city’s cost for infrastructure is $5.2 million, of which $3 million will come from grants.

In 2020, the city won a $1 million grant from the state Opportunity Zone program for the infrastructure work, and state officials secured $2 million in capital grants last year, as well.

The remaining $2.2 million will come from a loan from the city’s general fund reserves, which will be paid back over time from the property tax revenue generated from developments in the TIF district, City Manager Danny Langloss said.

Earth moving and access road construction as part of the Gateway Project as seen from Bloody Gulch Road in Dixon on April 18, 2023.

The Gateway project will be in one of two new tax increment financing districts the city created. It will be in the Fargo Creek TIF, which has boundaries roughly covering First Street to the north, Peoria and Chicago avenues to the east, I-88 to the south and Depot Avenue and Pump Factory Road to the west. The other is the Industrial Park TIF south of I-88, between South Galena Avenue and U.S. Route 52.

The council approved the loan Monday.

Gateway is being developed by Xsite Real Estate of Burr Ridge and Walsh Partners of Elmhurst. Xsite is the developer of Presidential Parkway Plaza, the four-building project north of Walmart along the south side of Keul Road. The city, the Lee County Industrial Development Association and Sauk Valley Bank also are partners in the project.

In February, the council awarded Oregon-based Martin & Co. Excavating the $4.87 million contract for the infrastructure work.

In 2021, the council approved annexation agreements across 657 acres, including land for the Gateway Project, after years of working with landowners and developers to open up new opportunities in the area.

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Rachel Rodgers

Rachel Rodgers

Rachel Rodgers joined Sauk Valley Media in 2016 covering local government in Dixon and Lee County.