DeKalb TIF public hearing scheduled for Monday

October 6, 2018

DeKALB – A public hearing regarding the proposed new tax increment financing district will kick off Monday’s City Council meeting.

Mayor Jerry Smith said the session “will be key” to let residents comment on the TIF plan, and help inform the Joint Review Board as it decides how to advise the council on a vote for or against the new district. The council is expected to vote on the district at a November meeting.

Smith said Friday morning that he is “absolutely in favor” of the proposed third TIF district, saying the other two have benefited the community.

Discussion is back on the table after being put on hold after last month’s Joint Review Board meeting, during which DeKalb School District officials alleged the city misused TIF funds for administrative costs over the past decade. District 428 officials alleged the city used between $500,000 and $800,000 yearly for administrative fees. Allocating funds to administration falls within the allowed guidelines according to Illinois law; however, school district officials brought up the fund usage because there was no clear justification for why that much money was allocated the way it was, said the school district’s lawyer, Gino Galluzzo.

Discussion on the matter was halted last month to give the city time to gather more information on past TIF spending before moving forward with the proposal.

Emphasizing his enthusiasm for transparency and open communication, Smith addressed what he called a “major controversy,” saying the city is required to do an annual report on its TIF spending and allocations. In response to the controversy, he has proposed distributing $11.25 million – the leftover balance of the combined increment from the city’s first two TIF districts – among taxing bodies.

Jason Michnick, economic development planner for the city, said he also is in favor of the proposed TIF district.

“[Passage of the new TIF district] is critical to continue supporting property owners,” said Michnick, citing the high cost of bringing old buildings back to standard as a deterrent for downtown revitalization without tax districts.

Michnick said most downtown properties commonly are occupied by Mom-and-Pop shops whose owners cannot afford to renovate and maintain a building on their own, leading to a slump in economic development with short shelf lives for businesses and an unsustainable cycle of development in the city.

The proposed central business TIF district primarily would cover downtown commercial property, including the Cornerstone and Plaza DeKalb projects, which already have received about $5 million combined in city funding. TIF districts have been used in the area for more than 30 years.

The public hearing is listed as the first agenda item for Monday’s City Council meeting, which will start at

6 p.m. at the DeKalb Municipal Building, 200 S. Fourth St., after the 5 p.m. Committee of the Whole meeting.

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