Belleville asks IL lawmakers to extend life of tax district to pay for city improvements
The 35-year-old property tax district known as TIF 3 in Belleville has financed improvements in the city including a new police station and sewer projects.
City officials are making a pitch to extend the system’s life another 12 years before it expires on Dec. 31.
Belleville needs state legislators to OK the extension. City leaders hope the lawmakers will do so during the fall veto session that begins Tuesday.
If the extension is not approved by the state, the TIF, or tax increment financing, district would end.
In a TIF district, property values are frozen at the level when the district is created. Any additional revenue generated by a rise in property values is channeled into a special fund earmarked for infrastructure improvements and economic incentives in the district.
The tax “increment” is the “difference between the amount of property tax revenue generated before TIF district designation and the amount of property tax revenue generated after TIF designation,” according to the Illinois Municipal League.
Belleville’s TIF 3 was created in 1986 and covers most of the city. If state lawmakers approve the extension, the district would be 47 years old when the proposed extension expires. This would be the second time the city received a 12-year extension on TIF 3. The original plan called for the district to last 23 years.
Money generated by TIF 3 has been used to help pay for a new police station on West Main Street, a new firehouse off Illinois 15, renovations at City Hall that brought it to American with Disabilities Act standards, sewer system improvements, and streetscape projects. It also offers a tax incentive for businesses.
TIF supporters say the money is used to improve infrastructure, help raise commercial property values, and assist businesses that produce significant retail sales tax revenue needed to run the day-to-day operations of the city.
TIF opponents say the sites getting TIF assistance would be developed anyway and that it allows a local government to pick “winners” that receive TIF grants while other companies don’t get any financial incentive.
TIF 3 plans
During the campaign for mayor earlier this year, Mayor Patty Gregory said she wanted a “special audit” to be done before she would support a plan to extend the district for 12 years.
Mark Eckert, the previous mayor who was defeated by Gregory in April, said in the campaign that he supported extending TIF 3 by 12 years and his administration began the process before the election.
Jamie Maitret, the city’s finance director, said the city has its finances audited every year and the city staffers have reviewed those results with Gregory, who has since said she backs the plan to extend TIF 3.
Maitret said if TIF 3 ended, the school districts that have been receiving money from the districts would likely increase their property tax levies to recover the lost revenue they were used to receiving from TIF 3.
And the city “would have to raise the levy as well” to keep up with its infrastructure needs, Maitret said.
Other taxing bodies support TIF 3
TIF 3 is budgeted to produce estimated revenue of $13.48 million for the fiscal year that ends on April 30. The city intends to give $4.82 million to area school districts.
Those school districts have key input in the city’s proposal to extend the lifespan of TIF 3.
State lawmakers want all taxing districts within the Belleville TIF district to support the city’s proposal. All have signed on with their support of the extension, Maitret said.
The city expects to rebate money back to the districts at the same level they have received in the past.
The taxing bodies in TIF 3 include Southwestern Illinois College, Belleville High School District 201 and Belleville School District 118. This plan also includes St. Clair County, which previously had not received a rebate from TIF 3 funds.
Maitret said she didn’t want to predict how state lawmakers will handle Belleville’s request but noted that other TIFs that had full support of their taxing districts have had proposed extensions approved.
Maitret said “TIF 3 is a tool” for economic development and that the goal is to strengthen the city’s economy so that the city would not need additional extensions.
This story was originally published October 19, 2021 at 5:00 AM.
