Crystal Lake Park Board Interrogates City TIF Consultant

“How can the City of Crystal Lake adopt a TIF district that takes money away from people who don’t live in Crystal Lake?” Commissioner Dave Phelps asked. “It’ll cost people who don’t live in Crystal Lake more money. Doesn’t that seem wrong to you?”

Thursday night Crystal Lake Park District Board members interrogated the City of Crystal Lake’s Tax Increment Financing (TIF) consultant Mario Ortega in an attempt “figure out which shell the pea is under,” to put in Board member Scott Breeden’s words.

“What you’re asking us to do is to ask all of those people to help pay for Crystal Lake where those people cannot take any advantage of it,” Breeden added.

After extended vigorous questioning, the Teska Associates consultant Ortega recommended people “should bring up any concerns you have at the public hearing or the joint review meeting.” The public hearing is at 7:30 PM at City Hall on Tuesday, November 1st.

The mayor and the city council have proposed two TIF districts, which will take what I calculate to be an average of about $100 million for 23 years off the tax roles for all tax districts, but city government.

One TIF is on the southern edge of Downtown. It will make more of the tax base disappear than will the Rt. 14 proposal.

West of Main Street it is comprised of where Hines Lumber Company used to be located and the two buildings to its west along Crystal Lake Avenue.

East of Main Street, the old Oak Manufacturing properties north and south of Crystal Lake Avenue west of Main Street are included, plus points south to the railroad tracks where Main Street Classic Cars is located.

That $100 of assessed valuation—on the average–will disappear from every tax districts’ tax base for 23 years. The lose will average over $6 million a year or about $138 million over the 23-year period. In fact, the amount may be more because the city expects the redevelopment of the Rt. 14 property to be completed within five years.

Because of the way the property tax cap works, local tax districts are not at their maximum tax rate. For that reason, tax districts will be able to raise their tax rates on all real estate, except what is in the TIF districts. This will result in higher tax rates for all property in McHenry County and, of course, higher tax bills.

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