SPRING VALLEY — The Spring Valley City Council plans to seek an extension for its TIF (Tax Increment Finance) District, which is scheduled to run out in 2029.
An extension would allow the city to keep its TIF an additional 12 years and serve the maximum 35 years.
A TIF is a method of using future gains in taxes to subsidize current improvements, which are projected to create the conditions for said gains. The city can use its collected TIF funds for a variety of improvement projects within the district including demolition of a building, rehabilitation of a structure, prepping a site to build infrastructure, pay for engineering costs, etc.
The city’s last TIF collection carried a gross increment of about $470,000, which about 20 percent was committed to local school districts.
A map highlighting Spring Valley’s TIF District can be found on the city’s website.The council invited attorney Herb Klein to last Thursday’s committee meeting to talk more about how to proceed with an extension.
Klein explained how the process to get an extension is different than establishing the TIF. When seeking an extension, the ultimate decision-maker is the legislature in Springfield.
The process involves introducing a bill and getting it passed by the House, the Senate and ultimately signed by the governor.
“The practice of the legislature in Springfield is they will not introduce a bill or seek a TIF extension if any of the taxing bodies are in opposition,” Klein said. “Ideally, (the taxing bodies) will write a letter stating they are in support of the extension.”
Spring Valley would have to get support from three school districts, Illinois Valley Community College, the Bureau County Board and the township.
Klein said there have been a number of communities in the surrounding area that have gotten a TIF extension, including Ohio, Oglesby, Ottawa, Morris and Mendota. He said the county board supported the Ohio extension, and IVCC has a history of supporting TIF extensions.
“There have also been instances we have become familiar with where cities have tried getting TIF extensions and haven’t been able to get them,” he said. “There’s no guarantee. It’s a process to work through. Usually what happens when you seek a TIF extension is start by having meetings with leadership of the taxing bodies and explain your reason for it and what we need. Also, show them the financial side of it and how it will benefit the town, how it will benefit them and what they would get out of it.”
Mayor Walt Marini asked if there were any bills on the horizon that could impact the city’s chance of getting the extension.
“Last year and the year before, there were a number of TIF reform bills. Some of them negatively impacted the ability to set up new TIFs or made it much more difficult, but none of them were introduced this year. But it doesn’t mean they could come back next year,” Klein said. “It’s hard to predict what will happen in Springfield.”
Council members agreed to get the process moving, in which Klein said he would get together with Marini; the best thing to do is start setting up meetings with the affected taxing bodies.
Klein said the city is only into its eighth year of the 23-year TIF, so if action with the taxing bodies isn’t good now, it doesn’t mean it won’t be in the future.
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