A Critique of the Lakewood SportsPlex Meeting

Bond analyst Steve Willson, a Lakewood resident, put together his take on what happened at the public hearing on the ChicagoLand SportsPlex.  You may read it below:

A Summary of Lakewood’s Public TIF Meeting

Village: Thank you for coming to our information meeting.  We value public input.

* You have already made up your minds and have no intention of changing your minds no matter what evidence is offered.  The meeting was for public relations purposes and failed at that.

Village: If we don’t offer a TIF, development will never happen.

* Development happens all over the country without TIFs.

Village: But we know this is true in this particular case because every developer approaching us has asked for a TIF.

* Businesses always ask for tax breaks and claim nothing will happen without them.

Village: But development hasn’t happened yet without a TIF.  That proves a TIF is needed.

* The same claim could have been made about the land along Randall Road twenty years ago or about any undeveloped property.

* Lack of development to date only proves development doesn’t make economic sense on its own, which is why a government subsidy is being sought.

The proposed Tax Increment Financing District is in the upper left hand corner of the map.

The proposed Tax Increment Financing District is in the upper left hand corner of the map.

Village: The development will provide increased taxes because of excess TIF revenues.

* That will be true only if the business succeeds.  One color poster and speeches from the developers that they have rigorously investigated the profitability of this venture do not constitute proof.

Lakewood's proposed new TIF District.

Lakewood’s proposed new TIF District.

Village: The TIF Eligibility study shows the project is likely to succeed.

* The Village’s TIF eligibility study says only that the TIF is legal, not that this project is likely to succeed nor that this TIF is good public policy.  Your consultant gave the answer he was paid to provide.

Village: The developer has provided strong evidence the project will succeed.

* Studies provided by the developer hardly constitute proof.  They have a vested interest in finding consultants who will say their business will succeed.

* This is not a modest-size or typical project, it is a mega-development for a very unusual business venture.  The unusual nature of the venture indicates the project is speculative and has a low probability of success.

* This is a project that has been attempted several times over the last five years and has never found financing.  The project’s unsuccessful history indicates it is speculative.

* One major factor in the success of a business is sufficient capitalization — equity.  Does this project have equity?  No, in has no equity.  They can’t even afford to pay $70,000 for the Village’s out-of-pocket costs.  The backers expect to borrow more than 100% of the cost of the project (hard costs + soft costs + capitalized interest).  Lack of equity is a strong indication of a speculative business venture.

* Their business plan is to run a seasonal business in youth sports that depends on attracting teams from far away for weekly tournaments.  Teams from far away will not come to this facility for practiceLocal teams will not use these facilities for practice because they have places to practice.  The sole reason to come to this facility is for tournaments.  To succeed, they will have to take market share away from other facilities for youth sports tournaments regionally and nationwide.  The facts are that the number of young people in this area and in the country as a whole is in decline and participation in youth sports is also in decline, so the number of potential participants is highly likely to decrease in the future.

* The eligibility study says you can sell $66 million in TIF bonds that mature over 23 years.  To repay that amount, this project would have to produce more than $3.5 million in property taxes annually before the Village or local schools see an extra dime.  That implies a market value of more than $150 million. How likely is this based on the foregoing?

The second version of the SportsPlex will cover the following area, some of which is owned by the Village of Lakewood taxpayers.

The second version of the SportsPlex will cover the following area, some of which is owned by the Village of Lakewood taxpayers.

Village: This development will stimulate other development that won’t require a TIF, resulting in property tax revenues we would not otherwise see.

* The historical evidence contradicts this assertion.  All independent TIF studies show this is a rare event and studies by TIF organizations show only that businesses locate where subsidies are offered, not that the local governments usually obtain any excess revenue in anything less than 20 years.

Village:  We are only financing infrastructure improvements, not the project itself.

* The TIF eligibility study shows $66 million in potential expenses, only $15 million of which is for public infrastructure.

Village:  We are not putting any taxpayer money at risk.

* Haven’t you already spent $70,000 that the developer’s couldn’t pay for?

* Aren’t you waiving hundreds of thousands of dollars in fees?

* Won’t this project increase governmental costs without paying taxes for 23 years?

* Didn’t you buy a piece of land for several hundred thousand dollars with taxpayer money with no clear plan to sell it for a profit?

Village:  Buying land is economic development, not real estate speculation.

* Buying land and hoping to sell it for more in the future is real estate speculation.  Calling it something else does not change the reality of what you’ve done.


A Critique of the Lakewood SportsPlex Meeting — 65 Comments

  1. Steve’s biggest takeaway point:

    * Lack of development to date only proves development doesn’t make economic sense on its own, which is why a government subsidy is being sought.

    I’ve spent over 30 years telling clients that no investment should ever consider tax consequences when determining if it’s a good investment or not.

    It’s no different here.

    Incentive programs are nothing more than a race to the bottom and a luxury we can’t afford.

  2. Excellent analysis as usual from Steve Wilson.

    The key point to remember here is that for a TIF district to be legal, it has to be unlikely that the area will be developed without a TIF.

    This is patently false as it concerns the intersection area of Routes 47 and 176.

    This is a prime retail environment.

    It is virtually inevitable that this area will be developed as soon as economic conditions warrant.

    Randall Road used to be lined with farms. Did that make it a TIF eligible area?

    How about the Western half of Lake In The Hills? Farms.

    How about the Southern portion of Crystal Lake? Farms.

    How about my backyard in northern Crystal Lake. A farm.

    All now developed.


  3. PLEASE do NOT imply that “local” schools will EVER see “AN EXTRA DIME”.

    1.BY LAW, ALL property tax revenue from this tif is to be paid directly to Lakewood management, to be given away and distributed as they desire, with little or no oversight or regulation.

    2.This extends for the next 23 years, with a statutory 12 YEAR rubber-stamp extension available.

    3. There is NOTHING in writing obligating Lakewood management to voluntarily relinquish one dime EVER to the school district obligated to educate “their” children from tif development.

    4. Woodstock Dist. 200 doesn’t have Lakewood students now, and doesn’t currently receive Lakewood property tax money.

    (“The eligibility study says you can sell $66 million in TIF bonds that mature over 23 years. To repay that amount, this project would have to produce more than $3.5 million in property taxes annually before the Village or local schools see an extra dime. That implies a market value of more than $150 million. How likely is this based on the foregoing?”)

  4. In order to issue TIF bonds, the Village must PROVE development is unlikely to occur without TIF financing.

    The key word here is “PROVE”.

    Prove, not “assert”, not suggest, not provide some evidence in favor but ignore evidence against.

    “PROVE” is a strong word, a high barrier.

    To conclude when the weight of the evidence is against you is not to “PROVE” necessity.

    Mike Walkup provided several excellent examples of local areas similar in key respects to the proposed TIF district.

    All were developed without TIFs.

    These examples contradict Lakewood’s arguments.

    I have cited three academic studies showing TIFs rarely provide superior growth beyond EAV growth in the TIF district — from which no revenue will be available to local governments for at least 23 years.

    I found no academic studies that reached the opposite conclusion.

    These studies contradict Lakewood’s position.

    Lakewood has the unsupported opinion of a consultant hired to give the opinion Lakewood wanted.

    Rep. McSweeney got the Alternate Revenue bond law changed because of the attempted abuse of the use of consultants by McHenry County College.

    Clearly the necessity of a TIF has not been proven and for the Board to continue to hold that the necessity has been proven without rebutting these three points only shows their minds were made up before the public meeting, that they are emotionally committed to this decision without regard to evidence.

    I doubt very much any judge hearing an objection to the formation of this TIF district would find the evidence so compelling as to hold that Lakewood has proven the necessity for a TIF district.

  5. Steve:

    Your comment: “the Village must PROVE ” makes the assumption that existing law will be adhered to.

    How many illegal aliens are now covered by the Obama Dream executive actions?

    How many illegal aliens will be covered under his latest circumvention of current immigration law?

    Federal Immigration and Nationality Act Section 8 USC 1324(a)(1)(A)(iv)(b)(iii)

    Laws have become a matter of inconvenience only to be obeyed by those who still have a moral compass.

    State marijuana laws are in violation of federal law.

    Quinn’s executive order relative to illegal aliens was in violation of federal law.

    DOMA, passed by Congress was never enforced.

    Constant public vigilance by people such as Steve, Susan, Mark and others followed up with ‘pitchforks’ in the streets is what will stop the TIF.

  6. Questioning is absolutely right.

    There is no rule of law. We have examples right here in our county.

    Just read Cal’s blog for everyday occurrences of his fifth sentence.

  7. Questioning and Cindy, you have missed my point entirely.

    I am not only suggesting that the Village Board has a fiduciary obligation to weigh all the evidence objectively and not just seek to rebut arguments that oppose their preconceived conclusions.

    I am also suggesting that those who stand to lose the most from this TIF district — the homeowners who came out in force at the meeting — should organize themselves and consider whether a legal challenge makes sense.

    Being forced to fight a legal battle would put the Village Board in a quandary: how much more Village money do they spend on this project?

    They’ve already promised no more money would be spent, so they’d have to break that promise.

    Then they would face the downside for the Village and for them personally as officeholders of what losing the case.

    Talk about egg on their faces!

    Look at what happened in Oakwood Hills.

  8. In 2008 the Fifth Appellate District in downstate Illinois held, in the case of Malek vs City of Belleville, that individual taxpayers had standing to sue over whether or not a TIF district met the statutory criteria. That case also involved mostly undeveloped farmland.

    The case was remanded back to the trial court where it was found that the TIF was proper. On appeal, this was upheld.

    The judge who had authored the original decision filed a dissent, mentioning that the land in question was perfectly profitable farm land and was not ‘blighted’.

    This may look disheartening but there would nevertheless be an opportunity for someone who lives in Lakewood to file a lawsuit against the Village should this go through and force a determination by a judge where it would be a factual question that could go either way.

    (I am not available for hire on that so this is not a pitch for business).

  9. Steve Wilson?

    We did NOT miss your point at all.

    It seems YOU are the one totally missing OUR point.

  10. The Lakewood IL Route 47 & 176 Farm and Golf Course TIF.

    That’s an over-generalization but drives the point home the TIF is not being formed because the property parcels actually suffer from some unique adverse condition such as blight or parcels of property that due to their shape or location can’t be developed.

    There’s no ghetto, abandoned factory, or old ratty looking retail area that’s past its heydey at 176 & 47.

    It may or may not legally qualify as a TIF under Illinois State law, but the TIF is being created because it allows the village to issue bonds to get a wad of cash upfront using as collateral at least in part future taxes from taxpayers outside it’s own municipal boundaries.

    So how do taxpayers figure out if that’s a good use of their money?

    They read the SB Friedman TIF Eligibility, look at the village website, attend village board meetings (which are not videotaped and thus not archived on the village website), and read village board minutes.

    That’s not enough information to adequately evaluate the proposed expenditure of taxpayer dollars.

    What’s lacking?

    One item lacking is a spreadsheet listing each parcel, it’s past EAV, and its past tax revenue history, going back say 23 years, and forecasting forward the next 23 years.

    Next, a clear basic explanation including a PowerPoint presentation (or something visual) of how taxes and TIFs actually work.

    For instance something along these lines, and there’s no claim this way is better than any other way, it’s just trying to portray some key points.

    We will oversimplify in no small part due to the fact that one of the hallmarks of Illinois law is exceptions.

    First, EAV x Tax Rate = Extension.

    EAV is property value.

    Extension is actual taxes.

    Thus, from a property owner perspective, value of property x tax rate = amount of property taxes you pay.

    From a taxing district perspective the formula is more complicated.

    Extension increases are limited to the lesser of CPI or 5%, with at least one exception.

    The exception is is Taxing Districts have a maximum tax rate that supersedes the extension increase rule.

    So maximum extension increase cannot occur if it causes the Taxing District to exceed its maximum tax rate.

    In such a case, the maximum tax rate rule limits maximum extension to below the lesser of CPI or 5%.

    So now lets form a TIF District because we need taxpayer money to spur development to generate more tax revenue to give the taxpayers what they want.

    A TIF can be viewed as an investment or expense by taxpayers.

    So let’s look at the TIF from the taxpayer perspective.

    Instead of putting your money in a stock, bond, mutual fund, 401k, IRA, college savings plan, buying a cup of coffee a day or week or month or whatever, the taxpayer is investing in a TIF.

    The return on investment is the tax revenue generated by parcel(s) in the TIF district will generate an increase in tax revenue that will lessen the increase in property taxes you will have to pay in the future.

    Now you can argue that’s technically not the case but it drives the point home, it’s your money, you should understand how this works.

    A TIF district is made up of parcels of land.

    EAV (value of property) of those parcels is frozen in the TIF District.

    EAV of parcels outside the TIF District is not frozen.

    That’s a very important concept.

    Next, forming a TIF District does not change any Extension rules (so the lesser of CPI or 5%, and the maximum tax rate rule, stay in place).

    That’s another very important concept.

    So let’s think about that.

    EAV in TIF District frozen.
    EAV outside TIF District not frozen.
    Extension rules remain the same.

    Next, virtually every Taxing District increases its taxes from one year to the next as you well know because your property tax bill keeps going up.

    That’s the Extension increase.

    So if Extension increases, and EAV in the TIF district is frozen, and EAV outside the TIF District is not frozen, what does that mean?

    It means the Taxing District cannot get its tax increase from the parcels of land in the TIF District.

    The Taxing District cannot get its tax increase from the TIF District.

    Yet, the Taxing District is still legally allowed to get its tax increase.

    So where does the tax increase come from?

    From the parcels of land outside the TIF District, by some combination of EAV increase and / or tax rate increase.

    Restated, he Taxing Districts get the Extension increase from parcels outside the TIF District.

    Now there are all kinds of ways to analyze that to come to the conclusion if the net is a tax increase or not.

    We will briefly cover a few.

    There are more.

    We could write a chapter about each one.

    One can argue eligibility for TIF states TIF District EAV would not increase unless the TIF District was created.

    So that argument goes irregardless if there is a TIF or not, property taxpayers outside the TIF District would see the same tax increase.

    And another argument for TIF Districts is that TIF District development in turn spurs development outside the TIF District, which results in increased property tax revenue, which offsets the TIF district subsidies.

    And an argument against TIF Districts is they generate costs in the taxing districts who service the TIF district (fire, library, park, schools, etc. even he municipality itself which controls the TIF District), and those costs are not fully born by the TIF district.

    And there is the point that Taxing Districts have maximum tax rates set by state law, so their extension can’t be increased past a certain point, so if there is Taxing District overlapping a TIF District that is at or near its maximum tax rate, the impact of the TIF District is lessened to non-existent.

    That of course requires an analyses of tax rates for each Taxing District affected by the TIF District.

    Where is that spreadsheet showing Taxing District, current tax rate, maximum tax rate?

    And again there are plenty of more arguments for and against.

    But for a taxpayer to even begin to analyze if this is a good deal, the taxpayer needs to understand the money flow.

  11. “A TIF is a targeted development finance tool that captures the future value of an improved property to pay for the current costs of those improvements.”

    Do you want to invest in future development of Lakewood and the surrounding communities or continue to rely on ever-increasing, always-fluctuating property taxes?

    Who is to define what constitutes blighted?

    What future economic value and growth will come of the land if any?

    If none, what harm could be caused by not addressing current issues?

    Environmental studies of current soil have indicate severe deterioration and contamination.

    Those contaminates can severely harm groundwater supplies and community health.

    Since TIF funds finance costs typically pertaining to public infrastructure, land acquisition, demolition, utilities, planning, etc.

    Lakewood seems to have a viable case in applying for and appropriately using TIF funds.

  12. In order to avoid a legal battle, which leaves the fight in the hands of the judges (never a good idea in a corrupt society), the fight still may be political.

    The elected body needs to be notified of the political consequences of continuing the behavior of stealing from The People.

    The power behind the notification is a number of residents actively showing up to meetings, writing letters/emails and protesting in the street outside the meeting place of the legislative body.

    Potential legal fees should be spent on door hanging, billboards and online targeted advertising.

    All of these may be organized and issued within 48 hours and presents a powerful reason for the legislative body to table the discussion til some future date(the hope being the heat dies down). Then vigilance is called for to avoid a midnight end around The People’s desires.

  13. NO the tif doesn’t stop at paying for targeted costs (public infrastructure, land acquisition, demolition, utilities, planning, etc.) Read the budget, page 32 tif eligibility study.

    And read the tif statute. For 23 years plus another 12, all the incremental property tax goes to Lakewood municipal managers to dole out as they see fit. I can find no enforceable oversight or control on how they distribute this money.
    So long after the ‘infrastructure’ is paid off, there is a dividend coming to Lakewood. There is nothing in the law or the information provided by Lakewood stating that they are just out for the costs of infrastructure.

    That might be ok if it were not at the expense of all the other citizens in the County (and their own citizens to some degree).
    For 35 years, all the children of the tif must be provided schooling and that will come at the expense of District taxpayers. Lakewood has cleverly arranged that to be school District in Woodstock D200, not the school districts Lakewood children attend, and Lakewood taxpayers currently pay taxes into. So for 35 years, others will pay 100% of the school costs for their children, and believe me that is substantial.

    There are other expenses that will rise just through inflation in this county over 35 years, and they will be paid for by all citizens, and the tax rate will rise. Except instead of going to pay for all the services provided by the County, the money attributable to the tif will rise with tax rates and inflation and go to the tif. By Law.

    These things make a fortune. Google Chicago tif and you will get an education.

  14. How about this one?
    Appellate Court of Illinois,First District, Third Division.
    No. 1-02-0363.
    Decided: June 30, 2003

  15. There have been proposals in other parts of the country to limit TIF’s to urban areas, for which they were originally intended.

    What happens is that speculators buy agricultural land on the margins of municipalities and then try to get it included in a TIF district to help pay for the development.

    This has the effect of driving up the cost of the land so the speculators can sell it at a greater profit, or develop it themselves on a subsidized basis.

    I see that Rep McSweeney is proposing a bill to ban red light cameras (a good idea). Maybe he could sponsor a bill as well to ban the use of TIF districts on agricultural land.

  16. Ban tifs on all land. Then write legislation to deal with legitimate urban funding needs. Why would you want to protect the billions inChicago tif slush funds? If they spent that money on Chicago schools instead, we might get a break on the State educational allocation.

  17. As a revenue-side mechanism, TIF is a way of earmarking tax revenues for a particular purpose, in this case local economic development.

    The effectiveness of economic development expenditures depends on opportunities, incentives, and planning skills that are specific to each local area and each project.

    The opportunities and incentives projected because of the SportsPlex sounds like it would make the TIF beneficial for all of the surrounding towns as well as Lakewood, not only in new jobs but also in proximity of goods and services, plus any surplus from the TIF is mandated to be reinvested into taxing districts.

    Not to mention the improvements to the intersections surrounding the property in question.

    This means safer, cleaner roads for all residents.

    If property owners don’t want that cost to come out of taxes then there needs to be some other revenue.

    I don’t think that revenue will be sparked in the area without investments in infrastructure which the TIF will allow for.

  18. The additional 12 years is an extension not a given and even the 23 years is only a projected timeframe.

  19. Teagen?

    Have you not read one word of what Steve, Mark and Susan have been posting for weeks now?

    Enjoying your Route 14 monoliths, are you!!!!

  20. The proposed Lakewood TIF needs more cost justification.

    When a Taxing District issues bonds (not saying the Village of Lakewood will or will not issue bonds to fund the proposed TIF) the Taxing District is required by law to have a bond Official Statement with detailed financial information so investors have they data they need to make an informed decision.

    There is no such law requiring detailed financial disclosure to get TIFs approved.

    The TIF Eligibility Study is a start but does not contain all the data necessary to make an informed decision.

    Not that McHenry County taxpayers need all the data in a bond Official Statement to make an informed decision on the Lakewood TIF, but they need a whole lot more information than they have now.

    So the net of that is bond investors are better protected than taxpayer TIF investors.

    And it is an investment of taxpayer money the Village is asking for to fund the TIF.

    Does anyone have any idea how many McHenry County parcels of land would be taxed to fund the Lakewood TIF?

    There’s a lot of parcels in a lot of taxing districts.

    All parcels (if not all why not and how many) in each of the taxing districts below will help fund the proposed Lakewood TIF.

    The reason is because that’s how a TIF works.

    The EAV of parcels in the TIF District EAV is frozen.

    The EAV of parcels outside the TIF District yet within a Taxing District who has parcels in the TIF District is not frozen.

    Taxing District Extension is not frozen (note there is a maximum tax rate).

    So what does that mean?

    It means the incremental revenue to fund the TIF comes from parcels outside the TIF District yet within a Taxing District who has parcels in the TIF District.

    Here is the list of those Taxing Districts for the proposed Lakewood TIF.

    The following major taxing districts presently levy taxes on properties within the RPA:

    – Community College District 528 MCC
    – Crystal Lake Park District
    – Dorr Township
    – Dorr Township Road & Bridge
    – Grafton Township
    – Grafton Township Road & Bridge
    – Huntley Area Library
    – McHenry County
    – McHenry County Conservation
    – Rural Woodstock Library
    – School District 47
    – School District 155
    – School District 158
    – School District 200
    – Village of Lakewood

    – page 37 – 38 (pdf page 39 – 40) of the Village of Lakewood, IL Tax Increment Financing (“TIF”) Eligibility Study and Redevelopment Plan and Project, Illinois Route 47 & Illinois Route 176 Redevelopment Project Area, Final Report: November 12, 2014, available on the Village of Lakewood website.

  21. Edit the above to read, The EAV of parcels in the TIF District is frozen.

  22. Teagan you have to understand that a tif collects money for 35 years, long after any earmarked infrastructure expense -related bonds are paid off.

    tif money continues to be collected by law for 23 years plus a 12 year extension, and it is huge amounts of money by then, as the amount typically grows over time with inflation and rising tax rates.

    It would be within the power of Lakewood to voluntarily offer , IN WRITING, to limit the amount and duration of the tif but they are not willing to,do so.

    And you do not understand that the surrounding area not only will not benefit, but actually will be forced to subsidize this tif with substantially higher taxes.

    Here’s why:

    The argument being used for the tif is that but for tif there would be no development here.

    I believe there has been no development here because property taxes are too high.

    That is only going to get worse, in large part due to,this tif and the subsidization by non- Lakewood citizens it will require.

    So we will still have reason for no contributory development, and be paying higher taxes as insult added to injury.

    Taxes on homes in that school district, Woodstock D200, pay property taxes of 4% of home value.

    That is nearly the highest in the country( I’ve never found any higher).

    No one will develop here because no one would voluntarily live in a 4% tax environment.

    Primarily the high tax rate is due to D200, which taxes 2.73% of home value.

    Now here comes this tif, which will place all children resulting from residential into D200.

    This is a school district NOT paid into by Lakewood at present, and the tif will not pay a single penny of taxes to D200 ( for the ext 35 years) because the tif money will go to Lakewood management to give away as she sees fit to developers.

  23. If this boondoggle of an idea is built, you can take the
    ‘pleasant’ out of pleasant valley.

    The key here is to follow the $money.

    Qui bono.

  24. If Lakewood were willing to limit the monetary amount that this tif could earn, or the duration of its existence, they would


  25. Two days ago I sent Althoff’s office this email about tifs:

    The single best thing you could do for Illinois is to abolish tif districts (RDAs).

    In Woodstock, we pay property taxes over 4% of home value. (D200 alone takes 2.73% of our home values).

    Now, the poshy suburb of Lakewood has created a tif on vacant land (golf course and farmland) which will place the economic burden of all the children of the tif residential development into a school district which is not currently assigned to children of Lakewood.

    So our poor neighborhood and town will pay the costs enabling the tif, but collect no economic benefit for 35 years.

    California has recently abolished tifs and California Supreme Court upheld this legislation in ‘California Redevelopment Assn. V. Matosantos’.

    If you are serious about solving Illinois budget problems, how can you ignore such an obvious and effective remedy?

    If all of Illinois became a level playing field, development might just continue, only not with developers taking all upside and taxpayers paying all the costs.

    (my name)
    (my address)

    And just got this email reply:

    Thank you for contacting me with your thoughts regarding Exelon.

    I completely understand your concerns about potential higher electric bills. At this time, there has been no legislation filed on this issue. There are, however, numerous media reports about potential nuclear plant shutdowns in Illinois.

    I will, as always, consider your input and opinions if/when there is legislation filed. I, therefore, urge you to visit the following Illinois website for more information (Illinois Report on Nuclear Plants):


    And feel free to remain in contact with my office as the 99th General Assembly session progresses, to obtain new/updated information on this issue.

    Senator Pamela Althoff

  26. WHAT!!!!????!!!!

    Apparently Althoff has no reading comprehension.

    (Or she is following Tina Hill’s prescription for dealing with the folks.)


  27. Has anyone answered the question of what tax exemptions the Sportsplex 501c3 would receive?

    Federal Income Tax, State Income Tax, Sales Tax, Property Tax?

    Cullinane Law – Nonprofit Q&A: What are the benefits of having 501(c)(3) tax-exempt status?

    Illinois Department of Revenue – Sales & Property Tax Exemptions (PIO-37)

    Illinois Department of Revenue – Non-Profit Organizations

  28. One other item about TIFs in general, not sure if or how it would apply to the proposed Lakewood Illinois State Route 47 / Illinois State Route 176 TIF.

    If a parcel is designated as blighted, it can assist the village in condemnation proceedings if a property owner is unwilling to sell for whatever reason.

    The following is an article about TIF Condemnation.

    Illinois Review
    December 14, 2006
    TIF Condemnation Fight in Arlington Heights
    by Cal Skinner

    Also, have you noticed the map of the proposed non-profit 501c3 Chicagoland Sportsplex is on McHenry County Blog, but not the Village of Lakewood website.

  29. Here are 2012 Property Tax Statistics (Table 27, Taxing District Summary of Funds) from the Illinois Department of Revenue website, for the Taxing Districts whom have at least one parcel in the Proposed Lakewood IL Rte 47 / IL Rte 276 TIF.

    The Levy is for all counties in which the District appears.
    The Fund Extension is just for the McHenry County portion.

    District Name —————————- Levy ———- Rate ——— Fund Extension

    McHenry County College ——————- $029,695,000 — 0.39206% —- $026,917,740

    Crystal Lake Park District ————— $006,614,572 — 0.46054% —- $006,609,886

    Dorr Twp ——————————— $001,883,342 — 0.37282% —- $001,883,352

    Grafton Twp —————————— $001,886,847 — 0.14173% —- $001,874,322

    Huntley Library ————————– $002,674,299 — 0.24420% —- $002,004,590

    McHenyr County ————————— $078,580,000 — 0.99581% —- $078,535,191

    McHenry County Conservation Dist ——— $019,565,117 — 0.24808% —- $019,565,165

    Rural Woodstock Library Dist ————- $000,383,500 — 0.001043 —- $000.369,038

    Crystal Lake Elementary School Dist 47 — $070,316,425 — 0.0394766 — $069,275,175

    Crystal Lake High School Dist 155 ——– $072,525,000 — 0.0264496 — $070,415,851
    Huntley District 158 ——————— $062,085,247 — 0.0547812 — $049,948,610
    Woodstock District 200 ——————- $058,749,788 — 0.0689990 — $058,177,081
    Village of Lakewood ———————- $001,825,665 — 0.0166538 — $001,802,679
    Total ———————————— $406,784,802 — 0.2359556 — $387,378,681


    The fund extensions are not affected by the TIF.

    The Tax Rate is affected by the TIF.

    EAV of the parcels in the TIF is frozen.

    EAV of the parcels outside the TIF is not frozen.

  30. Expanded rights of condemnation /eminent domain are granted tifs.

    Famous Supreme Court ruling Kelo v. City of New London, which stated the City Development Corporation might use eminent domain to transfer land from one private owner to another private owner.

    Dissenting opinion from O’Connor, Rehnquist, Scalia and Thomas

    “Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random. The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms.”

  31. ***Updated to include EAV***

    Here are 2012 Property Tax Statistics (Table 27 – Taxing District Summary of Funds & Table 28 – Taxing Districts Valuation, Rate and Extension Table) from the Illinois Department of Revenue website, for the Taxing Districts whom have at least one parcel in the Proposed Lakewood IL Rte 47 / IL Rte 276 TIF.

    The Levy is for all counties in which the District appears.

    The Fund Extension [what is billed, which is almost all collected] is just for the McHenry County portion.

    District Name ———————————— Levy ————— Rate ———— Fund Extension ——- EAV

    McHenry County College ————————- $029,695,000 — 0.39206% —- $026,917,740 ——— $6,865,719,647

    Crystal Lake Park District ——————- $006,614,572 — 0.46054% —- $006,609,886 ——— $1,435,262,549

    Dorr Twp ————————————————- $001,883,342 — 0.37282% —- $001,883,352 ——— $0,505,162,414

    Grafton Twp ——————————————– $001,886,847 — 0.14173% —- $001,874,322 ——— $1,322,459,704

    Huntley Library ————————–———– $002,674,299 — 0.24420% —- $002,004,590 ——— $0,820,868,311

    McHenry County ——————————————— $078,580,000 — 0.99581% —- $078,535,191 — $7,886,571,742

    McHenry County Conservation Dist ————— $019,565,117 — 0.24808% —- $019,565,165 — $7,886,571,742

    Rural Woodstock Library Dist ——————— $000,383,500 — 0.001043 —- $000.369,038 — $0,353,823,491

    Crystal Lake Elementary School Dist 47 —– $070,316,425 — 0.0394766 — $069,275,175 — $1,754,843,252

    Crystal Lake High School Dist 155 ——–—– $072,525,000 — 0.0264496 — $070,415,851 — $2,662,268,282

    Huntley District 158 ———————————– $062,085,247 — 0.0547812 — $049,948,610 — $0,911,784,079

    Woodstock District 200 ——————————- $058,749,788 — 0.0689990 — $058,177,081 — $0,843,158,926

    Village of Lakewood ———————————— $001,825,665 — 0.0166538 — $001,802,679 — $0,159,371,231

    Total ———————————————————— $406,784,802 — 0.2359556 — $387,378,681 — $33,407,865,370


    The fund extensions are not affected by the TIF.

    The Tax Rate is affected by the TIF.

    EAV of the parcels in the TIF is frozen.

    EAV of the parcels outside the TIF is not frozen.

    Here is the official description from the Illinois Department of Revenue website about the two tables from which the above data was extracted and re-compiled.

    Property Tax Statistics Reported in Table 27 and Table 28:

    The following tables include property tax statistics for taxing districts compiled from the PTAX-250 series abstracts reported by county clerks and treasurers to the Illinois Department of Revenue.
    The property tax cycle extends over a two-year period.

    During the first year, referred to as the assessment year, property is assessed by local assessment officials, and the following year property taxes are extended, collected, and distributed to local taxing districts.

    The tax year of each table is the year of assessment for property taxes extended and collected the following year.

    For example, the 2008 table represents 2008 tax (assessment) year for taxes payable 2009.

    Taxing Districts Summary of Funds Table:

    This table details the tax levy, tax rate, maximum tax rate, and tax extension by individual fund for each taxing district within the county.

    The “Levy” is the amount of money to be raised from property taxes to support the operating needs of the taxing district during the year. 

    The “Rate” is the amount of tax due stated in terms of percentage of the tax base. 

    The tax rate percentage is derived by dividing the levy for a fund by the equalized assessed value (EAV) for the taxing district. 

    Some funds have a statutory maximum rate that cannot be exceeded.

    The “Fund Extension” is the amount of taxes billed for each taxing district. 

    The county clerk extends taxes by multiplying EAV by tax rate for each fund.

    The sum of the fund levies, rates, and extensions are listed following each taxing district.

    Taxing Districts Valuation, Rate and Extension Table

    This table details for each taxing district the EAV and current taxes extended by property class,
    and the total rate of all the funds. 

    The EAV is the total assessed value of parcels of property within the taxing district, after applying the state equalization factor. 

    Tax bills are calculated by multiplying the EAV by the tax rate to derive the amount of taxes extended for the taxing district.

  32. The tax exemption question was answered at the meeting, they will not be tax exempt from property or sales taxes.

  33. I don’t see how the expansion and protection of the wetlands and open space in the 160 acre area of the 600 total proposed TIF district can be compared to the “monoliths on Route 14”.

    The useable recreational space alone makes me desire this project over another series of track housing or Randall Road type strip mall.

  34. If TIF districts caused all the growth in value on existing properties within their bounds, there is no cost to taxing agencies and no effect on tax bills.

    So any project must be thoroughly scrutinized by residents and village officials, as is being done.

  35. Nothing is being made public about details of the tif, so we don’t know if anything is being carefully scrutinized.

    The only public documents show mixed use and estate residential.

    It is factually inaccurate to claim there are no wider effects on total taxes as well as tax rates.

    The children of the tif will be educated in D200, and the sole source of funding will be non-tif and non-Lakewood taxpayers.

    The roads maintenance, additional police protection, additional fire and rescue, additional spending which MCC and MCCD will be enabled by tif eav will all be paid for by Mchenry county taxpayers.

  36. With TIF, all taxing districts continue to receive property taxes levied on the base equalized assessed valuation (EAV) of properties within the project area.

    Additionally, municipalities have the authority to enter into Intergovernmental Agreements to address any excessive financial impact the TIF District poses to other taxing districts

  37. Lakewood has not entered into such intergovernmental TIF tax sharing agreements.

    Crystal Lake did with District 47 when then-Supt. Ron Miller made close to a holy crusade about the Vulcan Lakes TIF.

  38. Lakewood residents outside of the TIF area (in which very few residents live) will be taxed as virtually all of the other tax districts raise their rates to compensate for the lost assessed valuation.

  39. From SB Friedman:

    The Village is required to find that, but for the designation of the TIF district and the use of Tax Increment Financing, it is unlikely that significant investment will occur in the RPA.

    Without the support of public resources, the redevelopment objectives for the RPA would most likely not be realized.

    Finding: The Redevelopment Project Area (RPA) on the whole has not been subject to growth and development through investment by private enterprise and would not reasonably be anticipated to be developed without the adoption of this Redevelopment Plan and Project.

  40. With tif, the EAV is frozen at today’s EAV which is essentially zero.

    There are no school children at present form this golf course and vacant farmland comprising the tif.

    By the numbers presented by Lakewood they expect the EAV to rise to $34 million. $34 million minus current eav(zero)= $34 million being taxed at ever rising rates going to Lakewood management. (NOT
    Lakewood citizens, mind you).

    Now, who is paying fior the school costs of the children?

    NOT Lakewood.

    NOT tif.

    Taxpayers who this year are being taxed 2.73% of total home value just by school District 200 alone.

    (Total property tax rates here are above 4% of total home value).

  41. More Facts About Tax Increment Financing

    • TIF Area properties are assessed and taxed the same as in non-TIF areas. The only change is that during the life of the TIF District, the property tax revenue is distributed differently. Incremental increases in real estate taxes go to the municipality to help finance TIF eligible project costs within the TIF Redevelopment Project Area.

    • TIF Districts can create money for Schools. In Illinois, school districts continue to receive all the tax revenue they were entitled to before creation of a TIF District. Although schools usually lose General State Aid when assessed valuations increase, the incremental growth in property values within a TIF District is excluded from the property tax base when the State of Illinois calculates the amount of aid it awards to a school district. Therefore, the “poorer” a school district is, the more it stands to gain from having a TIF District.

    • Property tax revenue generated from private development within a TIF District is truly new money. Without TIF, development would not occur and the tax increment would not be produced. Not only would new tax money not be generated, but the area itself would remain economically stagnant.

    • Municipal officials control the allocation and disbursement of funds within the TIF District. TIF is the only economic development tool with which local leaders may have some control over the type of development occurring in the community.

    • The Illinois TIF Act permits a TIF District to exist for a maximum of 23 years. An extension for up to an additional 12 years requires approval of the Illinois legislature. Any TIF District may be terminated earlier if all financial obligations are paid-off and the municipality decides to end the District.

    • The full tax base, including the new growth, becomes available to all taxing bodies for their use after the TIF District ends. Until then, all major taxing bodies meet annually with the municipality to review the progress of the District.

  42. Steve:

    First, the Village is required to evaluate whether or not the RPA has been subject to growth and private investment, and must substantiate a finding of lack of such investment prior to establishing a Tax Increment Financing district.

    Supporting this finding, over half of the RPA (22 out of 37 parcels, or 55% of total land area) is vacant.

    In addition, no permits for major building activity have been issued over the past five years; four permits representing a total investment of $15,700 have been issued during this time for minor maintenance and repair to existing structures, and one permit has been issued for the installation of a large tent.

    Finally, the equalized assessed value (“EAV”) of the RPA as a whole has declined during four of the last five year-to-year periods.

    On the whole, the RPA has not been subject to widespread growth and development through investment by private enterprise.

  43. Teagan?

    Are you one of those that are perpetrating this fraud?

    The comparison is because they are the same bullies that are robbing you.

    They are liars and or incompetents.

    Susan and the others are trying to tell you that nothing good can come of this.

    This is total Agenda 21 spread the wealth by robbing from the taxpayers.

    Pages and pages of posts and you are still saying this could be a good thing!

  44. Of course assessed valuation has decreased pretty much everywhere.

  45. Where is the map with each parcel outlined, identifying each parcel and the reason each parcel qualifies for TIF status.

    We have already seen maps of parcels clumped together.

    We would like a map with each parcel uniquely identified, one map.

    Why do we need a map.

    This from the TIF eligibility criteria from the SB Friedman TIF Study.

    “Obsolete Platting of Vacant Land. This includes parcels of limited or narrow size, or configurations of parcels of irregular size or shape that would be difficult to develop on a planned basis and in a manner compatible with contemporary standards and requirements, or platting that failed to create rights-of-way for streets or alleys or that created inadequate right-of-way widths for streets, alleys or other public rights-of-way, or that omitted easements for public utilities.”

    Well if each parcel is not outlined on a map how can anyone verify the accuracy of the criteria used for designating a parcel “obsolete platting of vacant land.”

    What is classified as vacant land, golf courses and / or farmland, that’s not intuitive, and just because that’s the TIF definition doesn’t mean you can’t tell us in plain English so those not versed in TIF language, which is the vast majority of people, can figure it out.

    From the SB Friedman TIF Study:

    “Recreation/Open Space. The Crystal Woods and Craig Woods Golf Clubs account for three (3) parcels within the RPA.”

    What’s the PIN number of those parcels?

    That’s 3 of 37 parcels.

    What about the rest, define each one.

    Have these parcels declined in EAV any more than neighboring parcels, if so, cite specific parcel examples.

    There is nothing wrong with 176 & 47, other than there could be some intersection improvements.

    The main thing with 176 and 47 is that it is far enough away from Huntley, Lakewood, Crystal Lake, and Wooodstock that it hasn’t been developed yet.

    And anyone can tell that development is encroaching.

    The village website is sorely lacking transparency of this TIF proposal and all board meetings, where are the attachments and board packets to board meetings.

    How a TIF works hasn’t been explained fully in a meaningful sense to taxpayers – show the taxpayers the TIF math equations, how parcels outside the TIF, that have Taxing Districts in the TIF, get their tax rate jacked up to cover the Taxing District Extensions for TIF parcels which is a maximum of, the lesser of, CPI or 5%.

    Sure the taxing district is shorted EAV increases during the TIF (which they recoup upon conclusion of the TIF) but they are not shorted the annual Extension increase which is again the maximum of the lesser of CPI or 5%.

    Not to mention is it even legal to have a working golf course included in a TIF, from the Illinois Municipal Code TIF Statute it seems the golf course should be inoperable 5 years prior to the formation of the TIF.

    Golf course business is way down all over Chicagoland.

    This seems like a taxpayer incentive allowing a private golf course owner to dump the property without taking too big of a loss, or conversely, a developer subsidy for a private non-profit.

    And exactly what taxes is the non-profit exempt from: Federal Income Tax, what else?

    Not to mention the elimination of Craig Woods and Crystal Woods takes some competition away from the village owned Red Tail golf course which in the past has had some financial difficulties.

    There’s all sorts of other points as has been chronicled in the blog.

    This TIF has not been thoroughly vetted with the public and at the very least should be postponed.

    Just because it’s legal, and that is questionable, doesn’t mean the taxpayers should be shelling out money to fund a TIF District to hopefully recoup there investment.

    There are all kinds of things that are legal that taxpayers don’t want to spend their money on.

    If anything this whole exercise proves Lakewood is not very transparent and the TIF laws need an overhaul.

    SB Friedman and the Village could have a lot more information about the TIF and Sportsplex on the village website but chose not to do so.

  46. We need a listing, by parcel #/PIN, why each parcel#/PIN qualifies for TIF status.

    Such as listing for the 37 parcels listed in the TIF Study.

    Only EAV is listed for each of the 37 parcels / PIN.

    The SB Friedman proposal is not written from the taxpayer analysis FACT checking perspective.

    The SB Friedman proposal is written from the Lakewood wants to approve the TIF perspective.

    Hard to argue that given all the points brought up that last few weeks.

    Just because SB Friedman has done lots of TIF Studies and Projects does not mean the proposal is written so the taxpayers can adequately evaluate this proposed TIF.

    It seems for a proposed $66 Million project the taxpayers should get a lot more detail.

    Here’s some figures.

    The EAV in the proposed TIF is about $34 Million.

    Say the overall tax rate is 8%.

    $34,000,000,000 x .08 = $2,720,000.

    That is EAV x Tax Rate = Taxes

    EAV = Equalized Assessed Value.

    So the hope is to increase overall taxes from negligible to $2,720,000 after 23 years or less (typical TIF is 23 years).

    The proposed TIF project is about $66 Million.

    So the village is spending $66M so all the taxing districts can $2.72M per year.

    Of course the $2.72M will increase a maximum of, the lesser of, CPI or 5%.

    And we could do some present value analysis.

    But absent of all that, it would take about 24 years, about the life of the TIF, to recoup that investment.

    Maybe that’s a reason the maximum TIF period is 23 years.

    No clue how that analysis compares to other TIF projects.

    Obviously there are a lot more points, counterpoints, intangibles, etc. it’s just a frame of reference.

  47. Here is another point that has been previously mentioned but not for a week or two.

    The EAV in the area outside the proposed TIF declined more than the area in the proposed TIF over 5 years.

    SB Friedman does not say that in their report.

    You have to add up the numbers to figure that out.

    Maybe Illinois law doesn’t use that as a criteria, but common sense says it’s important information that should be pointed out in a professional expert specialized consultant study.

    Here is what the SB Friedman study says.


    The total EAV is a measure of the property value in the RPA.

    In order to qualify for this eligibility factor, the total EAV of the vacant parcels in the RPA, for at least three of the last five year-to-year periods prior to the year in which the RPA is designated, must have:

    1. Increased at an annual rate that is less than the growth rate for the balance of the municipality;

    2. Increased at an annual rate that is less than the Consumer Price Index (CPI) for All Urban Consumers; or

    3. Declined.”

    “A lack of growth in EAV has been found for the RPA in that the rate of growth in EAV has declined during four of the last five year-to-year periods.

    The basis for this finding is summarized in Table 2 below.

    In addition, the growth rate in three of the past five year-to-year periods has been slower than the rate of growth for the balance of the Village.

    Lack of growth in EAV is one of the strongest indicators that the area as a whole has been falling into a state of decline.

    “This eligibility factor was analyzed area-wide and is considered to be present to a meaningful extent for the entire improved portion of the IL-47 & IL-176 RPA.”

    That was page 22 (pdf page 24).

    -20.58% EAV outside proposed TIF.
    -24.95% EAV inside proposed TIF.

    Here are the numbers:

    Year ————— 2008-09 — 2009-10 — 2010-11 — 2011-12 — 2012-13
    Vacant RPA ———- .03% ——-(.45) —- (6.54) —– (6.74) —- (6.88)
    Village less RPA —- .15% ——(8.44) —- .22 —— (16.71) — (.17)

    If you read that page 22 (pdf page 24) in the SB Friedman TIF Impact report, they refer to seemingly the same parcels as both “improved” and “vacant.”

    Here is some vocabulary from the study.

    “Blighted areas” are those improved or vacant areas with blighting influences that are impacting the public safety, health, morals or welfare of the community, and are substantially impairing the growth of the tax base in the area.

    “Conservation areas” are those improved areas that are deteriorating and declining and soon may become blighted if the deterioration is not abated.

    Once again here is the name of the study.

    Village of Lakewood, IL
    Tax Increment Financing (“TIF”) Eligibility Study and Redevelopment Plan and Project Illinois Route 47 & Illinois Route 176 Redevelopment Project Area

    Final Report: November 12, 2014

  48. oops should be:

    -20.58% EAV inside proposed TIF.

    -24.95% EAV outside proposed TIF (yet within the Village of Lakewood).

    The decline in EAV was bigger outside the TIF over 5 years.

  49. Mark need to clarify something.

    Tifs get to live 23 years then get an easily obtained 12 year extension.

    So 35 years.

    The EAV being essentially zero today (vacant land), when any structure is built, the entire value of that structure will be credited to the ‘new, tif EAV’.

    So the new EAV will ramp up very quickly.

  50. The tif(RPA) is one little piece of vacant land in the wider area surrounding it, and none of that land around it has experienced any growth or building or development either.

    Most likely that is because the tax rate for the area is 4% of total home value.

    The tif will cause taxes to rise even more in this area, in order to subsidize tif owners.

    This makes it even more unlikely for development to occur in the area.

    The natural conclusion is to blanket the entire region in tif districts and ensure the taxing districts will receive no increased funding for the next 35 years.

    Taxes will rise to double digits rates, as property values fall all over the county , because of high tax rates, which makes property values fall further,…

  51. Year One: Before Hypothetical TIF

    Levy = 50,000

    EAV = 500,000

    Rate = 50,000/500,000 = .10 or 10%

    The following year, a TIF district is created, covering part of the hypothetical taxing area.

    The assumption is that property value will be higher because of TIF.

    It is also assumed that the levy will increase over the previous year.

    Within the TIF district, property values grow because of TIF, and some growth also occurs outside of the TIF area.

    The total EAV increases by $100,000 over the previous year—$30,000 within the TIF and $70,000 in the rest of the area.

    Year Two: With TIF

    Levy = 52,000

    Total EAV = 600,000

    EAV growth in TIF = 30,000

    Other EAV growth = 70,000

    Available EAV = 570,000

    Rate = 52,000/570,000 = .09123 or 9.123%

    In this scenario, the taxing agency receives its levy, and the TIF district receives tax revenues from its EAV growth.

    Taxes to Agency = 570,000 × 9.123% = $52,001

    Taxes to TIF district = 30,000 × 9.123% = $2,737

    Taxes for a property with EAV of $25,000= $2,281

    If it is assumed that no TIF district is created and that without TIF, no growth in property values occurred in what would have been the TIF area, then the available EAV and tax rate are the same as if the TIF had been created.

    The levy still increases by the same amount over the previous year and the same amount of growth occurs in the rest of the area—$70,000 in additional EAV.

    Year Two: No TIF, No Growth

    Levy = 52,000

    Total EAV = 570,000

    No EAV growth from TIF

    Other EAV growth = 70,000

    Available EAV = 570,000

    Rate = 52,000/570,000 = .09123 or 9.123%

    In this scenario, the taxing agency still receives the same amount of tax dollars, and taxpayers have the same tax rate applied to their property values, and thus the same tax bills.

    Taxes to Agency = 570,000 × 9.123% = $52,001

    Taxes for a property with EAV of $25,000= $2,281

    However, if it is assumed that some growth would have occurred in the TIF area even without TIF—say, $20,000 in EAV—and the same growth occurs in the rest of the area—$70,000 in EAV, and the levy increases by the same amount, the result changes in the following way.

    Year Two: No TIF, Some Growth

    Levy = 52,000

    Total EAV = 590,000

    No EAV growth from TIF

    Growth in TIF area = 20,000

    Other EAV growth = 70,000

    Available EAV = 590,000

    Rate = 52,000/590,000 = .08814 or 8.814%

    In this case, the taxing agency still receives the same tax dollars but taxpayers have a lower tax rate applied to their property values than they would have had—both with TIF, and without TIF if TIF caused all growth in the TIF area.

    The rate is lower when growth in the TIF area occurs without TIF because the higher EAV is available for calculating the tax rate.

    Taxes to Agency = 590,000 × 8.814% = $52,002

    Taxes for a property with EAV of $25,000 = $2,204

    The difference between the two rates—9.123 percent if TIF caused all growth and 8.814 percent if some growth would have occurred without TIF—is the cost to taxpayers of growth that was allocated to TIF but not caused by TIF.

    As part of the reform to the Illinois TIF statute (Tax Increment Allocation Redevelopment Act 1999), municipalities must submit annual reports for each TIF district to the state comptroller.

  52. The TIF can be effective if we scrutinize each project and development idea brought to this area.

    TIFs are not inherently bad or useless, it’s how they are used that causes that.

    This is a great opportunity for Lakewood and surrounding municipalities to invest in their future and I agree that we must vett every project scrupulously.

  53. Seventy-five percent of all Chicago TIF districts have no funds reserved for debt service.

    This would suggest that these districts are utilizing revenues from naturally occurring growth in property values instead of borrowing to make initial investments in development within the district.

    However, this practice contradicts the fundamental premise of TIF that growth and investment would not occur but for leveraged development financed through bonds with the debt repaid through the increased revenues generated by TIF-related activities.

    To look at Chicago as the basis for TIF use and to determine whether or not they are a feasible, financing tool is ludicrous.

    Chicago is not a good example of how TIF money can be spent.

  54. Nottifd you need to point out that the eav today is essentially zero. Development, and high density housing will create an eav well above zero very rapidly and will create many new students in a brand new school district which heretofore has been paid nothing by Lakewood (Lakewood kids go to CL schools).

  55. This particular tif project will put so much more property tax burden on the surrounding area (land almost identical in nature to the tif property, absent the golf course) that property taxes will probably exceed 5% of property values within a few years (they are 4% now).

    At 5% of property values tax, no surrounding municipalities or private speculators will invest their own money in development, without a tif of their own or special property tax waivers.

    This will hasten the upward curve of the tax rates in the area.

    So while this is clearly a wonderful opportunity for Lakewood (and I really admire the truly generous Lakewood residents who are honest enough to point out the flaws in this project), the surrounding municipalities will be subsidizing Lakewood, incurring blight in their own community, and forced to choose between disintegration or subsidization of additional non-contributory development.

  56. This Redevelopment Plan and Project is expected to have short- and long-term financial impacts on the affected taxing districts.

    At the time when the RPA is no longer in place as a TIF district under the Act, the real estate tax revenues resulting from the redevelopment of the RPA will be distributed to all taxing district levying taxes against property located in the RPA.

    These revenues will then be available for use by the affected taxing districts.

    In the meantime, municipalities can enter into agreements with other local governments if excessively negative financial impacts are incurred.

    Watching this unused, dilapidated land be scoured over by commercial developers is not how I want to see this area developed.

    There’s a chance for all the communities, including Woodstock, to benefit in long-term growth.

  57. The village has compared the SportsPlex project to the overall comprehensive plan including development of mixed use areas, open space, recreation and various residential units.

    By 2019, McHenry County is expected to have roughly 2,500 more residents age 25-34 than it
    currently does.

    McHenry County and Lakewood can capture that growing population.

    The six municipalities within the IL 47 corridor together accounted for 60.4 percent of county-wide new home construction in the 18 years between 1996 and 2013.

    The stress that this growth will put on roads, utilities and public services will cause property taxes to go through the roof to pay for them.

    These growing populations will be looking for housing which adds revenue and value to property taxes all around.

    “Given the limited opportunity for the assemblage of larger development parcels within the
    subject property (particularly noting that significant acreage aligning IL-47 will be devoted to
    retail and other non-housing commercial development), the potential for conventional single
    family home development is seen as limited. Therefore, only multifamily, attached, and higher
    density detached forms were considered viable for the property.”

    Taxing district schools will still get their money plus some what is remaining at the end of the TIF.

    That is why it’s so important to use this economic tool selectively and the Village and community members have been vetting the SportsPlex for over 5 years now.

    This is a great step toward rehabilitating an area that is degrading and bringing in environmentally and socially conscious development.

  58. This is not the law.

    The law is that for 13+ 12 years, whomever is manager of Lakewood will have a huge revenue stream of money to spend as she desires.

    It is factually inaccurate to claim otherwise.

    Especially offensive when none of these claims about restricting scope and duration of this tif are not in writing.

    It is sophistry for a proponent of this tif who stands to profit ( by offloading low income housing and all attendant costs associated with schooling for those residents onto Woodstock D 200 taxpayers) to claim benefits to be accrued by those on whom she is dumping.

  59. Corrections:

    23+12 years is legal lifespan of tif.

    None of these claims about restricting scope or duration are in writing.

  60. Google Chicago tifs 12 years extension, and the first page contains results of several Chicago tifs getting the extension, also Batavia and Lake Zurich.

    Looks pretty easy to get the extra 12 years.

    Can’t imagine a politician in the future Lakewood giving up that huge cashflow coming at the expense of taxpayers of a school district different than the one Lakewood is obliged to pay into.

  61. I think the commenter meant for 23 + 12 years, because a TIF district’s life is 23 years, unless extended.

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