School Board Members Say City Moving Too Fast on TIF, Not Allowing Time for Discussion

The city of Elmhurst is moving forward with its plan to establish a Tax Increment Financing district on North York Road, and District 205 School Board members say they've been caught off guard by the rapid timeline the city is pursuing.

The next step in the process of creating a new TIF is a meeting of the TIF Joint Review Board, made up of representatives of all taxing bodies within the proposed district, at 5 p.m. today, Monday, July 2, at City Hall.

Communication between the city and School Board has been lacking—School Board member Susan DeRonne said she heard about the JRB meeting from an article she read in the newspaper—and the School District has a lot at stake. The assessed value of the properties in the new TIF district, which is the city's largest, will be frozen for local taxing bodies for up to 23 years, and most of District 205's revenue comes from property taxes. The district also has been forced to over the past few years.

So board members want to know how the TIF can be structured to help—and certainly not harm—district finances.

The School Board called a meeting with the city's finance team, aldermen and Mayor Pete DiCianni June 28 to get some clarity on the city's intentions for the new TIF.

"You guys have thrown a very ambitious time line in front of us. I'm surprised at the speed at which this is coming down the pike," School Board member Jim Collins said. "When you don't communicate enough, misunderstandings occur; and we have not been communicating enough."

The aggressive timeline is due, in part, to at York and Industrial Drive. The city's Finance Committee back in March said Mariano's will likely from the proposed TIF.

City officials also want to from TIF 1, its current TIF which has already been extended and will expire in nine years, into the new North York TIF. The move would freeze its assessed value for an additional 23 years. 

"Is that even legal? To take something from one TIF and put it in another?" Board member Susan DeRonne asked city officials.

School officials said they have not been satisfied with the language in the TIF 1 extension agreement (in 2004), and they want any future TIF agreements to be much clearer.

Sixth Ward Alderman Steve Morley said the law allows for a city to move a property from one TIF to another, and any suggestion that the TIF agreement was vague for a reason is false.

"The concept of what we're doing is legal and done quite frequently in Illinois," he said. "I don't want the connotation that this was vague and vague for a reason."

He said everyone was under a lot of stress in 2004 to do what was economically best for Elmhurst.

DiCianni said the language in the 2004 agreement is "pretty straightforward."

"Well, then, we disagree," DeRonne said.

DiCianni asked school officials what they are looking for to make the TIF fair. The TIF does include two District 205 schools, Conrad Fischer Elementary and Churchville Middle School, he said.

"That's the first time schools have been included in a TIF," DiCianni said.

School officials said that was appropriate, because both schools need some work that could be paid for with TIF funds. But beyond that, the School Board is looking for some type of revenue sharing. Board members said they want to sit down and discuss what they want from the new TIF. They asked city officials to postpone any vote by the Joint Review Board on Monday.

"In my perfect world, I'd like to have a series of discussions," School Board member Jim Collins said. "It doesn't look like you guys are trying to run away with a bunch of money, but you need to give us time to look over it.

"We'd be best served by asking for a continuance of the vote on Monday—actually not voting on Monday—so we can work all this out together. I can only assume the city is under some type of pressure to create the TIF to bring in the one business (Mariano's) that you've got. But we need some time to make sure this is right for the schools as well."

Morley said the TIF has been discussed in the Development, Planning and Zoning Committee for eight months.

"Some sort of sharing of the dollars has always been part of our conversation," Morley said. "It's kind of a leap of faith. We've got a very solid track record of sharing the money with fellow taxing bodies."

He said changing the timing on the Joint Review Board might violate a state statute.

"The timing is set in motion at this point. The clock is ticking on the JRB," he said. "I think we all want the same thing. If we can get close to a broad-strokes agreement, we can let the lawyers handle the rest. They tell us the flexibility is here; the revenue sharing is here."

School Board member John McDonnough said he doesn't want to "fall into the trap of last-minute drafting," like the 2004 agreement.

"Unintended consequences get very risky at that point," he said. "It's premature to go to the JRB … We don't want this agreement to limit our ability to find new solutions. Some of this stuff looks restrictive to me."

The city's assistant director of finance, Tom Trosien, said the agreement is boiler plate.

"There's not a lot to be changed without starting over," he said. "There are ways to do an agreement (on the side)."

The city needs to be as pro-economic development as possible, DiCianni said.

"That's why we need to drive this bus," he said. "The more seeds we can plant for the future, the better position District 205, the Park District and the city will be in.

"If need be, a side agreement is the way to do this. We're up for that."