Woodstock School District 200 considers lawsuit over Lakewood TIF

WOODSTOCK – Woodstock Community Unit School District 200 administrators next week will be looking for board permission to sue the village of Lakewood over a special taxing district approved by the village in January.

Among the items on the agenda for Tuesday’s regular school board meeting is a resolution authorizing the lawsuit, which seeks the dissolution of the tax increment financing district centered on the intersection of Routes 47 and 176.

The purpose of the TIF – a tool that effectively freezes the value of property in the district that local government bodies can levy taxes on and places taxes collected on new value into a special fund for projects and other initiatives – is largely to extend water and sewer utilities to the area, the Northwest Herald previously reported.

Superintendent Mike Moan sought legal counsel and consulting services to determine the “appropriateness and legality of the Lakewood TIF due to pending economic impact on District 200 for the next 23 years,” according to district documents.

Part of the TIF district falls within the boundaries of District 200.

School district officials want to file a complaint based on findings that call into question whether parcels within the TIF district satisfy requirements laid out in state law. The claim by legal counsel is when the parcels in questions are removed, the remaining land is not contiguous, another requirement of the act, documents said.

Moan said a primary concern over the TIF is the possibility of residential development.

“Then we could have more students but wouldn’t be getting the corresponding revenue,” he said.

However, Lakewood Village President Erin Smith, who was surprised to learn the board was considering a lawsuit, said the TIF only contemplates commercial development and potential affordable housing for seniors or housing for special needs adults.

“I’m very surprised to see any legal action considered by District 200 when we’ve received no indication that District 200 had any concerns,” Smith said. “Leading with legal action rather than a professional conversation between District 200 and the village of Lakewood is an expensive way to manage taxpayer dollars.”

Moan said he did not have an exact dollar amount spent on legal or consulting fees thus far, but acknowledged there would be a cost incurred by suing the village.

“You have to look at the potential impact of residential development in a TIF zone to the district,” he said, adding the district still is open to having conversations with the village about whether that is a possibility.

When the proposed TIF district went before a joint review board made up of all the bodies that would be affected by its creation, District 200 abstained from the vote and it passed with no objections. At the time, Moan said he abstained because the school board had not yet voted on the issue.

A rejection of the TIF by the joint review board would not have killed the proposal. Instead, it would have forced the board to pass it with a three-fifths majority.

Smith said after that meeting, Moan and another district representative made “positive sentiments” about the possible development at that intersection. However, Moan said he did not express remarks in favor of TIF.

Four weeks ago, District 200 officials emailed village officials requesting a meeting about the TIF, but the message did not indicate concerns or time sensitivity, Smith said. The village agreed and sent date and time options to the district over the last few weeks, but a meeting was never set, which Moan said was due to scheduling conflicts.

This is not the first time this particular TIF has come under fire.

Residents objected to it when it was discussed at past meetings, citing concerns that the cost to provide village services like police and fire to that area if developed would be carried by the rest of the village.

At least one District 200 resident questioned whether the rest of the school district would have to cover the costs of any students who move into the TIF district.

Village officials have said the law that regulates how TIFs can be used allows municipalities to offset the cost of new students created by any new housing within the TIF – but only when that development received aid from the municipality or if the municipality paid for infrastructure within the housing site.

The TIF was the reason Paul Serwatka decided to run in Lakewood’s April election where he won a seat, earning about 39 percent of the 1,403 votes cast in Lakewood’s April election, more than any of the incumbent trustees running for re-election. Serwatka also took aim at a proposed sports complex that would anchor the Route 47 and 176 intersection.

• Reporter Emily K. Coleman contributed to this report.

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