Orchard Road TIF district study backed : News : Oswego Ledger-Sentinel : Hometown Newspaper for Oswego and Montgomery, Illinois
|Orchard Road TIF district study backed |
|Montgomery Village Board agrees to fund study in new budget|
|by John Etheredge|
The Montgomery Village Board has agreed to include funding for a Tax Increment Financing (TIF) district study for properties adjoining Orchard Road in its new annual budget.
During a committee meeting March 14, five of the board's six members voiced support for including a $20,000 line item in the village's general fund budget for the TIF study.
The new budget will cover expenditures for the village's 2012-13 fiscal year, which will begin May 1. The board is expected to adopt the budget following a required public hearing next month.
Board member Bill Keck said a TIF district could potentially serve to expedite business development along Orchard Road between Jericho Road and U.S. Route 30.
"We are trying to make the properties more attractive to develop sooner," he said, adding, "That is the main logic here."
Keck noted the pending completion of the Orchard Road widening project later this year makes it an opportune time for the village to consider a TIF district for the area.
"Granted, the economy isn't the best right now-actually it's pretty bad, but it's not going to stay that way forever," Keck said, adding, "I would like to have everything in place for this (corridor) to be developed when the economic situation changes."
If the board were to eventually approve a TIF district, the current assessment of the properties within the district would be established as the "base amount." The properties owners would continue to pay property taxes on their land to the village and other local taxing districts based on the base amount for up to 23 years. But any tax revenues generated from an increase in the assessment beyond the base amount-the tax increment-would be put into a special fund the village would use to pay for improvements in the TIF district area. Typically TIF district revenues are used to pay for public improvements within the TIF district.
Anne Marie Gaura, village manager, told board members the TIF study has been recommended by the Montgomery Economic Development Corporation (MEDC)'s Business Climate Enhancement Committee.
Gaura noted she also "strongly recommends" the village complete the TIF study.
She added that five years ago she wouldn't have recommended the board consider a TIF district for the Orchard Road area.
"(But) the world has changed and the economy is different and the question the board has to ask is: do you want to be proactive in encouraging development along the Orchard Road corridor?" Gaura said. "If you do, this is a great tool to utilize and encourage that development. If you don't, then we won't look at a TIF district."
When questioned by board member Stan Bond, Jeff Zoephel, the village's finance director, said the study would examine if the now vacant properties adjoining Orchard Road qualify for designation as a TIF district, the costs involved in making the properties suitable for development, and the amount of tax money the properties would generate, based on the types of businesses.
As an example, Zoephel said if the properties require $10 million worth of excavation work "you'll have to decide if the properties are going to generate enough to make it feasible. That's what the study will try to determine: Does the financing work out?"
Bond then asked Pete Wallers, president of Engineering Enterprises, Inc., the village's engineering consultants, if the village already has enough information on the properties.
"We know that the property on the west side of Orchard Road is in floodplain and we know some property on the east side of Orchard is developable," Wallers said, adding, "What we don't have is kind of the complete package (of information) on what types of businesses could go in there and what the market will allow and what TIF revenue could be generated."
For example, Wallers noted the village has proposed extending Aucutt Road west of Orchard Road. He said the extension would serve to open more properties for development on the west side of the road, but would require the construction of a bridge over the Blackberry Creek. Wallers said a bridge could be paid for with TIF revenues.
Board member Denny Lee said he does not believes the West Aurora and Kaneland School Districts would oppose the creation of a TIF district along Orchard Road.
"All they are getting (now) are taxes from cornfields," Lee said.
Construction of a TIF funded bridge over Blackberry Creek as part of an extension of Aucutt Road, Lee continued, could serve to attract businesses to the area that will generate taxes for all local government agencies, including the school districts.
When questioned by board member Matt Brolley, Gaura said the village's expected $20,000 cost for the study would eventually be reimbursable from proceeds generated by the TIF district.
Board member Andy Kaczmarek said he has been researching the TIF district issue and believes the village should "hold off" on the study.
Reject funding request
for new strategic plan
In other business during last week's board committee meeting, four of the six board members agreed not to budget $25,000 in the general fund for the new fiscal year to pay a consultant to develop a new strategic plan for the village.
Gaura recommended the board fund the plan since the current plan-adopted in 2005-was intended to last five years.
Gaura noted the village has grown and changed dramatically since the current plan was approved and a new plan is now needed to define the board's vision for the community and which items they want village staff to focus on over the next five to ten years.
If the board were to agree to fund the plan, Gaura said village staff would seek requests for proposals from planning consultants that would work with the board, village staff and residents in devising a new plan.
Brolley voiced support for funding a new plan.
"The world is a different place from 2005," Brolley said, adding, "I think putting this off for a year means we would be driving without a road map. I think it (the plan) is a worthwhile investment in the community."
"I agree on the importance of this (plan) but I think it is something we can put off for a year," Keck said.
Bond said he has read the village's current plan "pretty thoroughly" and believes the village does not need to spend $25,000 on a consultant work with village officials and residents on a new plan.
Bond added he would rather see the village spend the $25,000 to improve local streets.