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TAX INCREMENT FINANCING IN MARION, ILLINOIS

Gail West, City Administrator, City of Marion, Illinois

26th Annual Community Economic Development Conference March 5-6, 2015 / Marriott Pere Marquette Hotel, Peoria, Illinois

• TIF “Increment” comes from the INCREASE in Equalized Assessed Valuation (EAV) above a “Base Year” EAV.

• Annual increases in EAV are multiplied by the total

real estate tax rate each year during the life of the District.

• The resulting Real Estate Tax Increment is annually re-allocated into the City’s Special Tax Allocation Fund to reimburse public and private TIF eligible project costs.

2 Tax Increment Financing: Marion, Illinois 26th Annual Rural Community Economic Development Conference, March 5-6, 2015

Tax increment financing is a local redevelopment tool which Illinois municipalities can use to fund specified public and private improvements needed to prepare an area for further private investment.

TIF allows a community to recapture the increase (increment) in real estate taxes that result from a redevelopment project in a blighted, decaying, and under performing area.

When a TIF redevelopment project area is created, the value of the property in the area is established as the “base” amount. These base property taxes continue to go to the taxing bodies as they always have.

Tax Increment Financing: Marion, Illinois 26th Annual Rural Community Economic Development Conference, March 5-6, 2015 4

TIF DISTRICT NAME LIFESPAN TIF District I 1987-2023

TIF District IV (Downtown) 1990-2014

TIF District V (Pepsi) 1990-2026

Pavilion TIF District 1991-2011

TIF District VI (Crossing) 1994-2018

Golf TIF District VII 1995-2019

TIF District VIII (Crisp Cont.) 1995-2019

Marion Heights TIF District 2003-2027

Marion Heights II TIF District 2006-2030

Skyline TIF District 2007-2031

Hub TIF District 2010-2034

Route 13 TIF District 2014-2038

Tax Increment Financing: Marion, Illinois 26th Annual Rural Community Economic Development Conference, March 5-6, 2015

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Marion Heights TIF 10

Gander Mountain

IHOP

Strip mall

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Tax Increment Financing: Marion, Illinois 26th Annual Rural Community Economic Development Conference, March 5-6, 2015 12

Total Increase in Annual EAV Resulting from All Marion TIF Districts = $77,335,315

$0 $2 $4 $6 $8 $10 $12 $14 $16 $18 $20 $22 $24 $26 $28

Rt 13 TIF

Hub TIF

Skyline TIF

Heights II TIF

Heights TIF

TIF VIII Crisp

TIF VII Golf

TIF VI

Pavilion TIF*

TIF V (Pepsi)

TIF IV*

TIF I

Millions

TIF BASE EAV MOST RECENT EAV

*Note: TIF District IV & the Pavilion TIF have expired.

Tax Increment Financing: Marion, Illinois 26th Annual Rural Community Economic Development Conference, March 5-6, 2015 13

Marion TIF Districts Total Revenue by Fiscal Year FY 1989-2014 = $60,295,915

$0

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$5,000,000

$6,000,000

$7,000,000

TIF I TIF IV TIF V Pavilion TIF TIF VI TIF VII Golf

TIF VIII Crisp Heights TIF Heights II TIF Skyline TIF Hub TIF

Tax Increment Financing: Marion, Illinois 26th Annual Rural Community Economic Development Conference, March 5-6, 2015 14

Cumulative Expenditures of All Marion TIF Districts As of FY 2014 = $55,483,608

Public Project Costs, $14,662,620, 26%

Private Project Costs, $38,638,880,

70%

Administrative & Professional,

$2,182,108, 4%

Public Project Costs Private Project Costs Administrative & Professional

Steps in TIF

Qualification Study with legal description of proposed area

Redevelopment plan Joint Review Board (legal notices required

notifying taxing bodies) Public hearing (notices required to property

owners in proposed project area) City Council approval of three ordinances: (1) Authorizing the use of TIF, (2) Geographic

boundaries of area, (3) Detailed Redevelopment Plan

Qualification Study Before TIF can be used, a municipality must determine whether the area qualifies under Illinois statutes for designation as a tax increment redevelopment area. The municipality must determine if: (1)The proposed district boundaries be limited to properties which will benefit from the project. (2)The municipality demonstrates that the proposed area will not be developed without creating a TIF. This is called the “but for” test. (3)The area meets blighting requirement.

Ground Breaking: Volkswagen of Marion, July 2014

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The Hub TIF Goals

Upgrade the public infrastructure Create recreational areas & public green space to

raise the overall quality of life Rehab the old hospital for a new usage Seek development of 40 new commercial

projects and the rehabilitation of 100 existing buildings in the commercially zoned parts of the Redevelopment Area

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Marion 1938 25

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Marion 2014 27

Single point interchange

2014: Single Point Interchange completed by IDOT at I 57 & IL Rt. 13. Morgan Avenue entrance ramps and diverging diamond under construction.

Rent One Park

Rent One Park, a $22 million facility. In 2005 the base year EAV was $492,330, in 2007 the EAV was $7,617,830.

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MARION TIF DISTRICT RESULTS

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Questions????

Gail West, City Administrator City of Marion 1102 Tower Square Marion, IL 62959 Ph: (618) 997-2612 Email: cityadmin@cityofmarionil.gov Website: www.cityofmarionil.gov

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