Latest news with #RedevelopmentProjectArea
Chicago Tribune
13 hours ago
- Business
- Chicago Tribune
Kaneland School District files lawsuit against Sugar Grove over Crown development's TIF district
Kaneland School District 302 is moving forward with taking legal action against the village of Sugar Grove to challenge the tax increment financing district planned for the controversial Crown Community Development project at Interstate 88 and Route 47, according to a lawsuit filed on June 13 with the 16th Judicial Circuit Court. At its May 12 meeting, Kaneland's school board voted to authorize the district to possibly take legal action over the TIF district for the development project. The lawsuit was filed on June 13 with the Kane County Circuit Court, according to case information on the county circuit clerk's website. The project, called The Grove, is a planned 760-acre mixed-use development, commonly called the Crown development in reference to its developer, Naperville-based Crown Community Development, according to previous reporting. The planned development, which the village OK'd last September, is designed to include nearly 400 acres of residential properties, a walkable town center, more than 120 acres of commercial development and about 240 acres for a business park. The lawsuit filed by Kaneland is over the TIF district for the project. A TIF district is a sort of economic development incentive, in which the value of a property is essentially frozen, and the extra or 'increment' taxes created by developing the property go into a special fund used to pay for costs related to improving the area. According to an original proposal, 10% of the TIF funds were to go to the village for any improvements it needs to make in the area, but, in August, then-Sugar Grove Village President Jennifer Konen said Crown had agreed to give another 10% of the funds to be distributed among the other taxing bodies, of which Kaneland is expected to get $26 million. The original TIF agreement also included payments from TIF district funds to offset the cost of schooling for students living in the new housing at the development. Kaneland was previously in negotiations with Sugar Grove to create an intergovernmental agreement about the TIF district, according to past reporting. But, not satisfied with those terms, the district floated the possibility of taking legal action against the village in February. A spokesperson for Kaneland said the district declined to comment on the lawsuit until the village had been served. As of Thursday morning, Sugar Grove's Village Administrator Scott Koeppel said they had not been served. In the complaint, Kaneland says that the establishment of the TIF 'will deprive the school district of incremental property taxes levied against the Redevelopment Project Area for 23 years.' The lawsuit is arguing that there is an 'actual controversy' over whether the area qualifies for tax increment financing, per the filing. The district is making this argument in a few ways. It is arguing that the project area should not be considered 'blighted,' which was part of the rationale for its qualifying as a TIF district, and that the TIF district is not contiguous. It is also alleging that the village has not provided sufficient proof that development would not have occurred in the area without the creation of the TIF district and providing financial incentives to the developer. Per the lawsuit, the school district is asking Sugar Grove to dissolve the TIF district. The Crown development has seen significant community backlash as the project has progressed, including a majority of voters supporting a non-binding referendum in April asking the village to reverse course on the development entirely. In the same election, incumbent Village President Jennifer Konen, who was in support of the project, was ousted, according to past reporting. Pat Gallagher, the primary proponent of the petition for the advisory referendum, told The Beacon-News he felt the situation with the Kaneland lawsuit was avoidable, but he's supportive of it as 'the most appropriate next step.' Sugar Grove Village President Sue Stillwell said in a statement that 'regardless of the nature of the litigation and any dispute,' she is 'committed to fostering a positive, collaborative relationship with the Kaneland School District as well as the other taxing bodies.' According to a statement from Crown Community Development on Tuesday, construction at The Grove has not yet begun, but Crown is working with the village to secure the required permits to begin development.
Yahoo
06-02-2025
- Business
- Yahoo
Sterling to improve Northland Mall, surrounding areas with creation of TIF district
Feb. 6—STERLING — Sterling is moving toward creating a tax increment financing district to support the redevelopment of Northland Mall and its surrounding area. Sterling City Manager Scott Schumard told the Sterling City Council on Monday about results of a TIF district eligibility study conducted by SB Friedman Development Advisors. "The report mostly covers what SB Friedman did to establish that the area is eligible to become a TIF district by meeting a minimum of the five criteria that are required by the state," Schumard said. "Once that's put on file for 30 days, SB Friedman will send out mailers to the properties that are affected by this, which is essentially Northland Mall, the area where Jeff's Automotive is, and the empty former Holiday Inn parking lot." SB Friedman's report concluded that the Greater Northland Mall Redevelopment Project Area qualifies as a "conservation area" under the Illinois Tax Increment Allocation Redevelopment Act. According to the report, 100% of the primary structures within the proposed RPA are at least 35 years old, and five of the 13 eligibility factors are present to a meaningful extent throughout the three parcels: 1. Lack of growth in equalized assessed value 2. Deterioration 3. Excessive vacancy 4. Inadequate utilities 5. Presence of structures below minimum code standards The city contracted with SB Friedman on May 6, 2024, to conduct the study and create a redevelopment plan and project document. The owner of Northland Mall is reimbursing the city for the study, as provided for in the agreement for reimbursement with Sterling Investments LLC. TIF districts are tools used by local governments to encourage economic development in underperforming areas. These districts dedicate tax revenues generated within for improvements to encourage new economic development and job creation, according to the Illinois Department of Commerce and Economic Opportunity. How it works: * Local governments appoint certain areas as TIF districts. * The value of properties within the TIF district is frozen and set as a base value. * As those properties' values begin to increase as a result of new development or improvements within the TIF district, the increase in property tax is collected and placed into a special fund to pay for those improvements. Only the new property taxes generated by the incremental increase in the value of these properties after the TIF is established are available for investment in the TIF, according to the Illinois Tax Increment Association. Schumard said that in Illinois, TIF funds can be used to pay for things such as rehabilitation work and engineering as well as architectural fees, but they cannot be used for new construction. If Sterling's TIF district is approved, the three businesses within it can submit requests for qualifying redevelopment work to their properties. The city hopes those improvements will make the area more attractive for new retailers and developers. The estimated cost for eligible redevelopment projects in SB Friedman's plan is $40 million. This is the maximum amount that can be spent using tax revenue generated by the proposed TIF district, not including things such as interest or other financing fees. These are the estimated TIF-eligible redevelopment project costs shared in SB Friedman's report: * Administration and professional service costs: $2 million * Site marketing costs: $800,000 * Property assembly and site preparation costs: $6 million * Costs of building rehabilitation: $6 million * Costs of construction of public works or improvements: $19 million * Costs of construction of affordable housing: $1 million * Costs of job training or retraining (businesses): $800,000 * Financing costs: $800,000 * Taxing district capital costs: $800,000 * Relocation costs: $800,000 * Payments in lieu of taxes: $800,000 * Costs of job training: $400,000 * Interest costs (developer or property owner): $800,000 The projected estimates for each item are not fixed and can be adjusted by the city as needed due to changed redevelopment costs and needs. The City Council on Monday approved a motion to place the Greater Northland Mall Redevelopment Project Area Tax Increment Financing District Eligibility Report and Redevelopment Plan and Project on file with the city clerk's office for public review and inspection. Once on file, SB Friedman will draft a notice and adoption schedule for the TIF district, which will be put before the City Council for approval this spring.
