MARENGO – The city’s tax increment financing districts have failed to bring economic development, but officials remain hopeful that a new opportunity might come Marengo’s way.
The city enacted its two TIF districts in 2011 and both will expire unused in two years. One district is located in Marengo’s downtown area, along Route 23 from just south of First Street to a little past Route 20. The other district is located on the city’s east side, roughly between the library and the high school on Route 20.
But plummeting property values and a resulting lack of TIF revenue have some officials ready to move on to other opportunities.
“TIF districts are basically nothing we can use at this point,” Mayor Don Lockhart said. “We put them in when things were better, but right now we have to just let them go and look in a different direction.”
In TIF districts, property tax disbursement is frozen at a certain rate. As property tax rates increase as years go on, the extra money collected goes to a special fund used for economic development in the area. Declining property values, a poor real estate economy and a lack of viable TIF projects have led to the stagnation, City Administrator Gary Boden said.
“Generally, our city’s assessed evaluation has gone down 42 percent during the period of time almost concurrent with the life of the districts,” he said. “Before we have a project where we can start using the increment, we have to cover that deficit and whatever the project is.”
Tina Kropke, senior real estate broker with Premier Commercial Realty, attempts to market Marengo properties, both in the downtown area and at the site of the proposed Interstate 90 interchange. She said she gets frequent calls about the downtown properties, but the city’s infrastructure makes the location a tough sell.
“Down Route 20, there isn’t sewer and water on both sides,” she said. “You have to go up the street to do a hookup. … [The route] is also governed by [Illinois Department of Transportation] and after so much activity, they will want a designated turn lane, which means you have to widen the road. The costs end up greater than the project.”
An opportunity to broaden the tax base and bring jobs to the area might be on the horizon, as the decision on whether to move forward with the proposed Interstate 90 and Route 23 interchange looms.
On Tuesday, the McHenry County Board will consider the proposal. The interchange would be the first in the county and has estimated economic impact between $538 million and $1.7 billion, according to a study presented to the County Board in June. The Illinois Tollway Authority plans to replace the overpass at Route 23 and will pay for a portion of the project.
Marengo officials will work closely with McHenry County, the McHenry County Economic Development Corp. and other invested parties if the interchange is approved. The ultimate goal is to bring industrial growth, which would add jobs and keep people in the county, Lockhart said.
“We are in a strategic position between O’Hare, Route 39 and the Rockford airport,” the mayor said. “In the future, we will have a lot to offer. It’s not only good for the city of Marengo, but it’s great for the county of McHenry.”