TAX INCREMENT FINANCING IN MARION, ILLINOIS Gail West, City Administrator, City of Marion, Illinois 26 th Annual Community Economic Development Conference March 5-6, 2015 / Marriott Pere Marquette Hotel, Peoria, Illinois 1
TIF Increment comes from the INCREASE in Equalized Assessed Valuation (EAV) above a Base Year EAV. Annual increases in EAV are multiplied by the total real estate tax rate each year during the life of the District. The resulting Real Estate Tax Increment is annually re-allocated into the City s Special Tax Allocation Fund to reimburse public and private TIF eligible project costs. Tax Increment Financing: Marion, Illinois 26 th Annual Rural Community Economic Development Conference, March 5-6, 2015 2
Tax increment financing is a local redevelopment tool which Illinois municipalities can use to fund specified public and private improvements needed to prepare an area for further private investment. TIF allows a community to recapture the increase (increment) in real estate taxes that result from a redevelopment project in a blighted, decaying, and under performing area. When a TIF redevelopment project area is created, the value of the property in the area is established as the base amount. These base property taxes continue to go to the taxing bodies as they always have.
TIF DISTRICT NAME LIFESPAN TIF District I 1987-2023 TIF District IV (Downtown) 1990-2014 TIF District V (Pepsi) 1990-2026 Pavilion TIF District 1991-2011 TIF District VI (Crossing) 1994-2018 Golf TIF District VII 1995-2019 TIF District VIII (Crisp Cont.) 1995-2019 Marion Heights TIF District 2003-2027 Marion Heights II TIF District 2006-2030 Skyline TIF District 2007-2031 Hub TIF District 2010-2034 Route 13 TIF District 2014-2038 Tax Increment Financing: Marion, Illinois 26 th Annual Rural Community Economic Development Conference, March 5-6, 2015 4
Tax Increment Financing: Marion, Illinois 26 th Annual Rural Community Economic Development Conference, March 5-6, 2015 5
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Gander Mountain IHOP Strip mall Marion Heights TIF 10
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Total Increase in Annual EAV Resulting from All Marion TIF Districts = $77,335,315 TIF I TIF IV* TIF V (Pepsi) Pavilion TIF* TIF VI TIF VII Golf TIF VIII Crisp Heights TIF Heights II TIF Skyline TIF Hub TIF Rt 13 TIF $0 $2 $4 $6 $8 $10 $12 $14 $16 $18 $20 $22 $24 $26 $28 Millions TIF BASE EAV MOST RECENT EAV *Note: TIF District IV & the Pavilion TIF have expired. Tax Increment Financing: Marion, Illinois 26 th Annual Rural Community Economic Development Conference, March 5-6, 2015 12
Marion TIF Districts Total Revenue by Fiscal Year FY 1989-2014 = $60,295,915 $7,000,000 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 TIF I TIF IV TIF V Pavilion TIF TIF VI TIF VII Golf TIF VIII Crisp Heights TIF Heights II TIF Skyline TIF Hub TIF Tax Increment Financing: Marion, Illinois 26 th Annual Rural Community Economic Development Conference, March 5-6, 2015 13
Cumulative Expenditures of All Marion TIF Districts As of FY 2014 = $55,483,608 Administrative & Professional, $2,182,108, 4% Public Project Costs, $14,662,620, 26% Private Project Costs, $38,638,880, 70% Public Project Costs Private Project Costs Administrative & Professional Tax Increment Financing: Marion, Illinois 26 th Annual Rural Community Economic Development Conference, March 5-6, 2015 14
Qualification Study with legal description of proposed area Redevelopment plan Joint Review Board (legal notices required notifying taxing bodies) Public hearing (notices required to property owners in proposed project area) City Council approval of three ordinances: (1) Authorizing the use of TIF, (2) Geographic boundaries of area, (3) Detailed Redevelopment Plan Steps in TIF
Qualification Study Before TIF can be used, a municipality must determine whether the area qualifies under Illinois statutes for designation as a tax increment redevelopment area. The municipality must determine if: (1)The proposed district boundaries be limited to properties which will benefit from the project. (2)The municipality demonstrates that the proposed area will not be developed without creating a TIF. This is called the but for test. (3)The area meets blighting requirement.
Ground Breaking: Volkswagen of Marion, July 2014 18
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Upgrade the public infrastructure Create recreational areas & public green space to raise the overall quality of life Rehab the old hospital for a new usage Seek development of 40 new commercial projects and the rehabilitation of 100 existing buildings in the commercially zoned parts of the Redevelopment Area The Hub TIF Goals
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Marion 1938 25
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Marion 2014 27
Single point interchange 2014: Single Point Interchange completed by IDOT at I 57 & IL Rt. 13. Morgan Avenue entrance ramps and diverging diamond under construction.
Rent One Park Rent One Park, a $22 million facility. In 2005 the base year EAV was $492,330, in 2007 the EAV was $7,617,830.
MARION TIF DISTRICT RESULTS Tax Increment Financing: Marion, Illinois 26 th Annual Rural Community Economic Development Conference, March 5-6, 2015 30
Tax Increment Financing: Marion, Illinois 26 th Annual Rural Community Economic Development Conference, March 5-6, 2015 31
Questions???? Gail West, City Administrator City of Marion 1102 Tower Square Marion, IL 62959 Ph: (618) 997-2612 Email: cityadmin@cityofmarionil.gov Website: www.cityofmarionil.gov Tax Increment Financing: Marion, Illinois 26 th Annual Rural Community Economic Development Conference, March 5-6, 2015 32