City to meet with developer on possible Kmart TIF
STERLING – Before city officials greenlight a tax increment financing district in the city’s east end, they want to meet with the potential developer.
Aldermen voted 5-0 at Monday’s City Council meeting to approve a study on the feasibility of creating a TIF district that would cover about 16.5 acres. The Kmart building at 2901 E. Lincolnway is in the center of the proposed area.
Also included would be the long-vacant Beef-A-Roo property at 2913 E. Lincolnway and an adjoining parcel, and the property at 2619 E. Lincolnway, that once housed Moore Machine Shop.
The Greater Sterling Development Corp. will arrange a meeting between Mayor Skip Lee and City Manager Scott Shumard, and the developer, whom officials have not named, before the city agrees to pay for a study.
“It costs about $30,000 to $50,000 to do a study, so we’re not doing that right away. It would require something from the developers saying yes, they’re interested,” Shumard said.
If the city goes ahead with the study, it will be done by a TIF consultant who would determine whether the area is eligible under the Illinois Tax Increment Allocation Redevelopment Act.
The cost could be recouped through the district if a developer pursues a project in the designated area. Although any project in the district likely would be commercial, other uses could be approved.
Here’s how a TIF district works:
Taxing bodies, such as schools, library districts, fire districts, etc., are funded by property taxes. A TIF district “freezes” the equalized assessed value of the property within a district at a certain level for 23 years.
The EAVs still rise, but the money that is generated above that frozen level does not go to the taxing bodies; instead, it is put into a fund that can be spent only on projects within the TIF district.
The idea is to use the TIF fund to develop existing businesses, and to attract new businesses by giving them tax breaks, low-interest loans and other incentives to locate within the district.
Also Monday, the council approved a $1.8 million bid from Fischer Excavating of Freeport for the Douglas Park stormwater sewer improvement project.
The project will include new storm sewers, curb and gutter, streets and sidewalks in the Douglas Park neighborhood, which includes Douglas, Woodside and Harvey drives and Chestnut Avenue.
Work is expected to start by the end of July, and should be done by winter, Public Works Director Brad Schrader said.