When Elmhurst City Council meets on Tuesday, Sept. 4, to vote to establish a new tax increment financing district, , it will do so without an agreement in place to share TIF funds with District 205 schools.
Both bodies have been meeting for a couple of months to try to get something in writing that everyone can agree on, but they aren't there yet, School Board President Jim Collins said Tuesday.
"We're in substantial agreement with the majority of points with the city," he said. "We really hoped we could have an agreement in place by the time the city votes on Tuesday, but we won't. As I've said before, the devil is in the details."
TIF districts freeze assessed property values for local taxing bodies for up to 23 years to encourage development in areas considered blighted. TIFs generate revenue through new construction in the district. The difference between the frozen property value and any new growth goes into a fund to pay for public improvements or help finance projects in the TIF district as incentives to developers.
"We represent about 16,000 children that will receive their education in District 205 schools during the term that TIF 4 is in place," Collins said. "Eighty-four percent of District 205 revenues come from property taxes. That's why when TIFs are discussed, we spend a great deal of time talking about them."
What has been agreed upon is that the city will offer up to $6 million for capital improvements to and , which are both in the new North York TIF. It also is offering to release $1 million to the School District from TIF 2 (Lake Street). And the city has offered to share 10 percent of the tax increment generated by the new TIF after the first 10 years the TIF is in place.
In total, they city is offering the School District about $11 million, Collins said.
"$11 million, by any stretch, is far more than what the city projects District 205 would have gotten without the TIF," he said.
City projections show that without it, properties in TIF 4 would only generate about $950,000 for the district over the next 23 years.
If the new TIF exceeds expectations, however, there are as yet no provisions to potentially release funds earlier. That's just one of the details still being worked on, School Board member Chris Blum said.
"We fully understand that they need to fund the TIF with enough money that they can accomplish the goals of that TIF," he said. "If they exceed those projections, we're asking that we start to share maybe a bit earlier."
Other details need to be worked out so the agreement can stand the test of time, Collins said.
"What we're trying to achieve here is that 15 years from now, the new School Board and City Council can look at this document and not have an argument over it," Collins said. "That it would specifically spell out how much money is released, under what conditions and when, whether that's date certains, or formulas, so there is no question 15 to 20 years from now what the intent of our agreement was back in 2012."
Tuesday's meeting was sparsely attended. In addition to city aldermen Diane Gutenkauf and Scott Levin, only about five others were in the audience.
Resident Charles Mueller asked why there is such a rush to get the TIF approved.
"What's the hurry?" he asked. "Why can't the public take a look at what's being proposed? I'm the type of guy, I need to see it and run my own analysis."
Blum said the School District has no control over the timeframe for the TIF.
"The city has sole discretion and drives the calendar," he said. "We can't make the city do anything. At the (Joint Review Board), . Our preference was to have , but that's not our choice."
The School District has called several meetings to try to move toward an agreement as quickly as possible to meet the city's time frame, Collins said.
Jan Dorner, who is president of the League of Women Voters of Illinois but spoke as an Elmhurst citizen, wanted to know when all these meetings had taken place and, if they were held in closed session, under what stipulation of the Open Meetings Act.
School Board member John McDonough said there has been no violation of the Open Meetings Act.
"We have had substantial discussions with the administration in formats that follow the Open Meetings Act," he said, adding that many of the discussions have been held in public committee meetings that are poorly attended.
The School Board will continue to meet with the city to "work out the exact language and explore ways to reach a common understanding of the mechanisms in place to reflect our joint expectations," Collins said.
The board is "disappointed" an agreement won't be in place by next week.
"But we're very optimistic that we will reach an agreement during the month of September," he said.