Understanding the Proposed TIF District for Richmond, Illinois

They will tell you half truths like TIF is not a new tax,

They won't tell you that in order for TIF to work taxes will have to go up in the TIF district.

They won't tell you that taxes will have to increase outside the district to fund the shortfall from the increase that those other taxing bodies won't be getting.

  [ How It Works ] [ Idea Behind It ] [ What Is Blight? ]

A municipal government, in this case the Village of Richmond IL, declares a certain area of the village to be a TIF district. In a TIF district any future property taxes increases, on property in the TIF district, are then diverted back into the TIF district for "improvements". All of the money that the township, fire department, park districts, library, schools, county and cemeteries get from TIF district property taxes on the day it starts, stays the same for the following 23 years. The TIF gets the increase. Most other taxing bodies get what they got---for 23 years, or 35 years if a 12 year extension is needed.

For another quick perspective on how TIF works visit: TIF Bad for Schools. (from a real tax payers perspective). For a little more detail: Explanation of Tax Increment Financing

Sometimes the schools negotiate to allow TIF districts, getting some of the money they would have been denied. But when schools are included in a TIF District as in our case, it means they want the property for something else. Schools and churches are tax exempt. So if the Village (actually the newly formed TIF board) can get a hold of a school or a church then the tax input for the TIF district goes from nothing for those properties to at least the standard commercial property rate and all of that increase will go solely to the TIF District.

Tax exempt properties and agricultural land (the Golf course) and any vacant land become real windfalls for the TIF District. Remember, when the TIF District starts the property taxes going out are locked in at that current amount, the increase goes to the TIF district. So if a property paid zero property taxes before, the entire increase goes to the TIF District. It doesn't even go to the Village. Does that sound fair? Is that sound thinking on the part of the Village Board?

National Education Association position on TIF

Illinois Education Association responds to NEA position on TIF

Illinois Association of School Boards: More TIF abuses charged

Of course The TIF starts out broke or in debt, so usually it needs to sell bonds to borrow on those expected returns from the increase in property taxes. If those returns never come, the tax payers in the entire village, not just the TIF district, are then taxed to pay off the bonds.

The idea is to use that money to attract business and development by making it economically easier for them to come. That could mean things like creating a more attractive and safer downtown or it could mean using eminent domain to acquire and combine properties to give or sell to developers. The TIF board could do something like pay to have a road built or reconfigured, or pay to run sewer and water to a site or do any number of things that developer or business might have to pay for it they were starting up in another area. They could even acquire land and flat out give it to developers.

www.condemnation-law.com a site, put together by Biersdorf & Associates, answers many of the legal questions raised by property owners, in or near governmental redevelopment areas.

"As the timetable for the government's project progresses, you will be required to make decisions about your property. Your rights will be affected. Make sure that you become informed!"

Visit our studies and documents page for links to many in depth explanations as to what TIF means.

Please use this site as a resource to form your own opinion.

Did you Know?

TIF districts were originally designed to assist inner-city slum areas to be cleaned up, provide all levels of housing affordability and attract new business to the area. The laws are written so that an area needs to be declared "blighted" in some way in order to qualify for TIF "benefits". Unfortunately, the laws are written so that just about any property can easily be considered "blighted". Public Act 1055 (aka SB3086) Signed the IL Governor on July 30, 2006 by will place stricter guidelines on a governments burden of proof that an area is blighted. This is not a regional, but a national concern that individual states are now addressing due to a recent US Supreme Court ruling.

Declaring an area "blighted" and creating a TIF district gives the Village of Richmond IL extra eminent domain rights. Without a TIF district they only have the right to use eminent domain to secure property to put in sewer lines.

With a TIF district in place, and the area declared "blighted" the Village (guided by the new TIF Board that they appoint) will be able to condemn properties for reasons like:

       • Inadequate street layout

       • Improper Subdivision, obsolete platting

       • The building is occupying too much of its own property to allow for parking

       • The building is not up to current day codes
       • A developer has a better idea for use of your property than you do

The TIF district will have its own board of appointed, not elected, officials that will make all the decisions concerning the TIF district. That board will have the power to condemn, purchase and assemble properties to sell to developers as larger parcels.

Once the area has been declared "Blighted" the TIF board may claim that the market value of your property has dropped. The TIF board will only have to offer you the appraised value for your property. If this occurs, you will need to hire an attorney if you want to get the real fair, actual market value, which would be what the developer should be paying, but in many cases does not.

They say you can't fight city hall. The truth of the matter is,
once the TIF district is in place there really IS NOT much you can do
except get out of the way of their definition of progress.