The village of Clarendon Hills wants to establish a tax increment financing district along 55th Street to promote redevelopment and increase the area’s value.
But board members of Hinsdale High School District 86 voted unanimously last week for a delay in the TIF process, questioning why a relatively prosperous neighborhood needs such intervention, which would divert some property tax revenue away from school districts for 23 years or more.
At a special board meeting July 24, the board requested a continuance on a vote by the joint review board, an advisory group made up of representatives from taxing bodies impacted by the proposed TIF that was due to meet last night, July 31. The review board can weigh in on the proposal but has no veto power over Clarendon Hills’ ability to create the TIF. District officials want more time to gather information and possibly work out an intergovernmental agreement with Clarendon Hills.
In a TIF district, as development happens and property values increase, property tax dollars generated from the growth that would otherwise be collected and used for school purposes would be used to pay for public improvements in the TIF district for up to 23 years.
The proposed area encompasses about 70 properties along the north and south sides of 55th Street between Western Avenue and the Jewel-Osco to the east, including the neighborhood south of 55th around Western and Bentley avenues. The area’ current assessed value is about $14 million, which generates about $239,000 in taxes for the district.
Scott Ginsburg of the district’s law firm, Robbins Schwartz, told board members that data indicated the area did not meet the typical TIF criteria of a blighted or obsolete section with low or declining value.
“Not only is it growing, but it’s exceeding the village (EAV) as a whole,” Ginsburg said of the area, which Clarendon Hills estimates will increase to $30 million to $40 million in assessed value because of the TIF. “It was a major red flag for me to see them identify declining EAV as a basis for the TIF.
“It strikes me as somewhat pretextual,” he added.
Board President Cat Greenspon expressed concern at the financial impact the measure would have on Maercker Elementary District 60.
“The vast majority of this TIF district proposal is almost wholly one of our sender districts and that bothers me tremendously,” she said.
Greenspon also pointed out that District 86 taxpayers may see their tax rate increase more than it would have without a TIF, as properties in the TIF will not contribute toward taxes that can be levied for other new growth in the district.
“The entirety of the D86 footprint outside of unincorporated Clarendon Hills will absorb this tax burden,” she stated. “That is what everybody needs to understand.”
If new development in the TIF area results in additional enrollment, the district would be able to receive an amount of dollars per student from TIF funds, Ginsburg said. Districts have been able to work out intergovernmental agreements with municipalities in some cases to share some of proceeds from a TIF, he noted.
The village of Clarendon Hills has scheduled a public hearing on the TIF proposal at its Aug. 19 board meeting, with TIF ordinances projected to be approved in the fall.
Robbins Schwartz attorney Neal Smith said there’s little a district can do to halt the process.
“A village that’s decided to pass a TIF can plow through all those barriers at the end of the day,” he told board members.
