Subscriber exclusive: Records show where Woodstock has spent its tax increment financing district funds

Debt payment, Old Courthouse, streets, sidewalks get boost

As the deadline to decide on Woodstock’s new tax increment financing district approaches, city officials are looking back at projects accomplished by the existing TIF funds.

Much of the income generated by the district has gone toward paying off bond debt, maintaining public streets and sidewalks and making repairs to the Old Courthouse, reports filed with the Illinois Comptroller’s Office show.

Municipalities can establish TIF districts in blighted or underdeveloped areas to attract new economic development using financial incentives generated by the district. When a city establishes a TIF district, the property tax base in that area is frozen for a specified time – typically 23 years.

Property taxes collected on any added property value then are funneled into a city-controlled account set aside for projects in the area.

In fiscal 2017, the TIF district fund received $718,125 and officials approved spending $779,843.

Revenues included $665,057 in property taxes, while the rest came from building sales, a $20,000 transfer from municipal sources and $31,990 in unspecified “other” sources, records show.

About $195,000 went toward financing costs for about $2.5 million in alternative revenue bonds that the city issued to pay for cleanup of the Die Cast site, now known as Woodstock Station, more than a decade ago.

The city still is paying off the debt from those bonds as it tries to create a new, bigger TIF district. The existing district will expire in 2020.

The site, on McHenry Avenue north of the Square and railroad station, formerly housed a manufacturing facility and was contaminated.

One of the main focuses of the existing TIF district was the demolition and environmental remediation of the site, economic development director Garrett Anderson said.

“That would not have been feasible for private development,” Anderson said. “No private developer would have touched that.”

Several developers have expressed interest in building housing on the property since its rehabilitation, but the projects never were fully realized. Another developer came forward this year and requested potential reimbursement for a housing complex on the site.

Anderson said there is no plan to take on more debt associated with projects in the new proposed TIF district.

The property tax increment generated in the area has wavered, but it ultimately has decreased by more than $100,000 since 2010, records show. Online records were available from 2010 to 2017.

In 2010, the area generated $754.503. In 2011, the increment was $774,378, and numbers dropped in subsequent years. In 2017, the increment collected was $665,057. The lowest increment collected since 2010 was $602,709 in 2015, records show.

The TIF fund balance also has dwindled. In 2010, the city had about $1.3 million in the account, and most recent reports show a $151,851 deficit at the end of fiscal 2017.

In fiscal 2017, Woodstock used $263,850 in TIF funds on the Old Courthouse, plus paid for a $10,000 consulting study related to the facility’s use, $293,287 toward repairing streets in the district, a little more than $12,000 in administrative costs and $5,665 toward its facade improvement program, records show.

Over the years, the district has paid for many improvements to the Old Courthouse and Sheriff’s House. The city acquired the facilities through a donation in 2010. The next fiscal year, the city used $15,761 in TIF district funds toward improvements, and in 2012, the amount increased to $143,633.

The city spent $100,871 in 2013, $370,582 in 2014, more than $1 million in 2015 and about $200,000 in 2016, records show.

Private donations to the fund also have helped pay for improvements to the historic facilities, records show.

“The [Old Courthouse] is basically standing ... because we had the funds that allowed us to basically save it,” City Council member Mike Turner said at a recent meeting.

TIF district funding also made the redevelopment of the historic Classic Cinemas on the Square possible and funded street improvements, Turner said.

“If we wanted to accomplish any of those things I just listed, we would have had to massively raise taxes on property owners through property tax or some other means,” he said.

Beyond the Old Courthouse, the city has used TIF funding for facade improvements on various buildings; street and sidewalk maintenance and improvements; more than $100,000 in perimeter lighting, including new LED holiday lights on the Square; brick replacements; water and sewer improvements on Main Street; trash cans and signs; and parking enhancements, records show.

Council members largely have expressed support for the new TIF district, which would include 60 percent of the existing downtown TIF and an additional 500 acres of property in the downtown area and along Route 47.

Woodstock School District 200 and McHenry County College have opposed the plan because officials are concerned that TIF district-assisted housing developments will bring in new students without any new property tax dollars with which to educate them.

The City Council already has given tentative approval to provide TIF funding to multiple developers who want to create townhomes and apartments in the downtown area.

A public hearing on the new TIF district will be at 7 p.m. Dec. 4 at City Hall, 121 W. Calhoun St. The City Council is expected to take a formal vote on it in January.

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