After years of discussion and planning, construction of the first entrance to Interstate 90 in McHenry County is slated to begin in March, Marengo City Administrator Joshua Blakemore said.
Preconstruction work has been underway on I-90 at Route 23, Blakemore said, and the early part of construction is not expected to impede traffic on Route 23.
The project initially was estimated to cost about $24.7 million, but Blakemore said during a State of the Community event in January that the low bid for the project came in at about $20 million.
Under the terms of an intergovernmental agreement between the Illinois Tollway, Illinois Department of Transportation, McHenry County and Marengo, the standard cost-sharing for construction would be 50 percent of costs from the Illinois Tollway, 25 percent from IDOT and 25 percent from the county.
“This project is a great opportunity not only for Marengo, but for McHenry County and northern Illinois as a whole. We hope it will attract much-needed industrial development and bring jobs to the area,” Marengo Mayor John Koziol previously said in a statement. “I would like to thank the [Illinois] Tollway, IDOT and McHenry County for their continued support of this project.”
Barring serious weather setbacks, Blakemore said, Oct. 31 still is the project’s tentative completion date.
Once the interchange is operational, the city will look into offering development incentives.
Although discussions are preliminary at this point, one idea city staff is open to is the creation of an enterprise zone – which offers a number of state and local incentives for businesses – or joining the enterprise zone used by Harvard and Woodstock.
“It’s just a matter of keeping options open and exploring opportunities that are available,” Blakemore said.
State incentives offered to businesses wishing to apply to be in the Harvard-Woodstock enterprise zone include not having to pay the state portion of sales tax for building materials for qualified projects and a 0.5 percent income tax credit off income taxes for the total cost of a qualified project.
Another avenue the city is considering would be the establishment of a tax increment financing district near the tollway.
When a TIF district is started, property tax dollars on all taxing bodies in the district are capped. Any property tax dollars raised over that cap are diverted into a special account reserved for projects that will stimulate economic development and raise the equalized assessed valuation of the district.
Before a district can be formed, a feasibility study must be performed to determine whether a blighted property meets necessary qualifications to be a TIF district.
Marengo has had mixed results with its two TIF districts, which both were created in 2011.
The city’s eastern corridor TIF district began with a base EAV of $910,333. The latest EAV of the district, in 2017, was $1,190,945, according to documents filed with the state.
The city’s downtown TIF district has not performed as well. The base EAV of the district was $8,385,620 when it first was created, but an EAV of $5,480,165 was reported for 2017, records show.
To generate initial revenue, a municipality sometimes will seek the issuance of bonds or grant funding to support development. However, neither Marengo TIF district has procured any revenue outside of property taxes and some interest, according to documentation.
Most of the expenses of each district have been paid from other municipal funds because there were not sufficient revenues generated from the TIF districts available, city documents show.
Teresa Nortillo, president and CEO of Nortillo Consulting Group, said in an email that because development discussions are in very early stages, it is expected that whichever funding mechanism the city decides to employ would take at least 18 months to two years to unfold and would involve a lot of collaboration and input from all stakeholders.
“The development process, along with any funding options, involves many meetings and hearings,” Nortillo said in the email.