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Sugar Grove Village Board approves amendment to TIF district

Sugar Grove trustees voted to amend the village’s Northeast Airport Tax Increment Finance district No. 2 at their meeting on Tuesday.

A TIF district is an economic development tool designed to freeze an area’s tax base to allow the new monies generated over time to spur investment activity.

In a series of votes, the Sugar Grove Village Board of Trustees removed certain parcels from the village’s Industrial Tax Increment Finance district No. 1, added additional parcels of property to the Northeast Airport Tax Increment Finance district No. 2, adopted a redevelopment plan and related redevelopment projects for the amended redevelopment project area, and approved tax increment financing for the amended redevelopment project area.

The village board’s decision did not come without some opposition.

Sugar Grove Fire Protection District Chief Bill Perkins called the amendment into question, saying it does not promote the contiguity that is needed to simplify the manner in which funds are transferred between the TIF districts. He said enough is enough.

“The district continues to question and research the authority and the legality of the use of the TIF funds to purchase the property located on Heartland Drive,” Perkins said.

Sugar Grove officials have said TIF funds are required to be used within a TIF district’s redevelopment project area.

Still, Perkins argued that the Heartland Drive property is not contiguous to a TIF district.

“The district feels that the TIF funds that were used to purchase that really should be reimbursed back to the TIF by the village because it wasn’t proper use of TIF funding,” he said. “I think that the purchase of that property is what has put TIF No. 2 into the red, which has required the interfund transfer of funds from TIF No. 1 to TIF No. 2, which has now created the need to come back to this board to do an amendment so that the two TIF are contiguous and the money can come through.”

TIF district No. 1 creates about $200,000 annually, officials said. TIF district No. 2 generates about $50,000 per year, but it currently has a negative fund balance.

Sugar Grove Public Library Director Shannon Halikias asked the village board to give consideration to postponing the vote to give the library board more time to mull it over. She said she came to the village board meeting looking to speak neither positively or negatively about the TIF district amendment.

“Whatever decision you make tonight, please keep us in the dialogue,” Halikias said.

Halikias made a plea to the village board, asking Sugar Grove officials to be open to discussion with the library about future partnerships, resource sharing or compensation to help balance the books.

Not every trustee was on board with voting on the TIF district amendment. Trustee Heidi Lendi cast the lone dissenting vote, and Trustee Ryan Walter abstained.

Lendi, acknowledging the concerns raised by the fire protection district, asked the board to consider tabling the vote.

“Looking at the impact in the future of adding the areas that aren’t absolutely necessary for contiguity to the TIF District, I think, would put a great burden on the library and particularly the fire department,” she said.

Walter said he doesn’t know why there is a rush and is not ready to vote.

Village Administrator Brent Eichelberger insisted that the village is not rushing into anything.

“It’s been discussed at several meetings over almost two years, so to say it’s rushed in my opinion, is incorrect,” he said.

The village hosted its annual joint review board meeting in December 2019. The topic arose in discussion again during a Jan. 13 public hearing.

Village President Sean Michels, acknowledging that neighboring towns are putting TIF incentives to use, said the village is looking out for the public.

“Every community around us is extending TIF benefits to attract commercial development,” he said. “Commercial developers expect that nowadays. So, if we don’t have the TIF, we’re not going to see any commercial development.”

Michels said the village doesn’t always get the credit it deserves for making improvements to the benefit of the public and the neighboring taxing bodies.

“We don’t get paid back for it,” he said. “We know it’s needed to help out the community at large.”

Ultimately, the board voted to amend the TIF district.

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