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Illinois TIF Closeouts

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  • 1. Presented by: Mike Weber Director PGAVPLANNERS 200 N. Broadway  Suite 1000  St. Louis, MO 63102  (314) 231-7318
  • 2. Discussion Topics  Property Tax vs. Sales Tax TIFs  Planning for Closeout of TIF  Distribution of Surplus Revenue  Questions / Unresolved Issues PGAV 2
  • 3. Property Tax vs. Sales Tax TIFs  113 Property Tax TIFs Set to Expire in 2009  (20) 1986 & prior year TIFs extended  23rd Levy Year/Collected in 24th Year  Sales Tax TIFs:  63 already phased out  50 Authorized to be Extended to 2013  Municipal property tax increment required (2010 – 2013) PGAV 3
  • 4. Planning Closeout of TIF  Develop Projections  Annual tax increment revenues  Plus other sources of revenue  Less annual obligations  Equals balance to fund other projects that meet the goals and objectives of the TIF plan  Prepare Annual Spending Plan  Needs within TIF area  Needs of adjoining TIFs?  Amend TIF plan, if necessary PGAV 4
  • 5. TIF Plan FY2007 - FY2014 5.00% FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 Total Available New Revenues 6,279,007 6,381,645 6,768,023 7,179,677 7,618,393 3,438,044 3,706,897 1,004,708 42,376,394 Project Annual Debt Service (1997-B) 478,550 404,425 412,775 0 0 0 0 0 1,295,750 Annual Debt Service (2003-A) 399,400 475,463 464,588 462,475 94,472 86,744 79,031 76,359 2,138,532 Freed - G.O.Debt Service 228,730 229,203 228,394 226,363 223,900 221,000 222,800 219,300 1,799,690 Freed - Rev Bond D/S 605,025 729,838 782,763 816,888 842,925 341,113 361,388 0 4,479,940 Subtotal - D/S 1,711,705 1,838,929 1,888,520 1,505,726 1,161,297 648,857 663,219 295,659 9,713,912 School District Asst. 1,315,270 1,381,033 1,450,085 1,522,589 0 0 0 0 5,668,977 Joyce Pontiac 150,000 150,000 150,000 0 0 0 0 0 450,000 OTD Program 482,000 482,000 482,000 482,000 0 0 0 0 1,928,000 Subtotal - Committed 1,947,270 2,013,033 2,082,085 2,004,589 0 0 0 0 8,046,977 Street Maintenance 494,200 400,000 200,000 0 0 0 0 0 1,094,200 Sidewalks/Alleys/Lighting 325,000 325,000 225,000 0 0 0 0 0 875,000 Bridge Repairs 0 60,000 0 0 0 0 0 0 60,000 Storm Sewer Imps 234,100 270,000 0 0 0 0 0 0 504,100 Airport Imps 0 165,000 165,000 0 0 0 0 0 330,000 Central City Imps 830,000 60,000 250,000 0 0 0 0 0 1,140,000 Public Buildings 205,000 130,000 130,000 130,000 130,000 0 0 0 725,000 Administration/Misc. 400,000 300,000 200,000 100,000 0 0 0 0 1,000,000 Subtotal - Other 2,488,300 1,710,000 1,170,000 230,000 130,000 0 0 0 5,728,300 Grand Total $6,147,275 $5,561,962 $5,140,605 $3,740,315 $1,291,297 $ 648,857 $ 663,219 $295,659 $23,489,189 Balance Remaining 131,732 819,683 1,627,418 3,439,362 6,327,096 2,789,187 3,043,678 709,049 18,887,205 PGAV 5
  • 6. Other Considerations  Combination Property Tax and Sales Tax TIFs:  Avoid having unspent balances at the end of 2009. Start with a clean slate 2010.  Municipal contribution of prop. tax required (2010 - 2013)  Notify taxing districts of pending property tax TIF termination (by Nov. 1 of closeout year)  Property Tax TIFs:  Avoid having unspent balance  Notify taxing districts of TIF termination  2009 tax increment, payable 2010 can be used to pay obligations incurred 2009 or before PGAV 6
  • 7. Distribution of Surplus  Annual Surplus Declaration  See Sec. 5/11-74.4-7  End of TIF Surplus Declaration  See Sec. 5/11-74.4-8  State Sales Tax & Muni. Sales Tax Get Reimbursement Priority PGAV 7
  • 8. End of TIF Surplus - Example Cumulative Deposits: State Sales Tax $380,000 Municipal Sales Tax 180,000 Total Property Tax 1,500,000 TOTAL DEPOSITS $2,060,000 PGAV 8
  • 9. End of TIF Surplus - Example Total ONLY State & Municipal Sales Tax $560,000 Proportion State ($380,000/$560,000) = 67.9% Proportion Municipal ($180,000/$560,000) = 32.1% PGAV 9
  • 10. End of TIF Surplus - Example Surplus Funds at Termination: $600,000 State Proportion (67.9% = $407,143) Refund to State ($380,000) Muni. Proportion (32.1% = $192,857) Refund to Municipality ($180,000) Surplus Remaining ($40,000) Refund to County Treasurer ($40,000) PGAV 10
  • 11. Deposits to TIF Fund: State Sales Tax Deposits $380,000 Muni. Sales Tax Deposits 180,000 Property Tax Deposits 1,500,000 Surplus at Closeout $600,000 Distribution of Surplus: Refund to State $380,000 Refund to Municipality $180,000 Property Tax Refund (pro-rata to taxing bodies) $40,000 PGAV 11
  • 12.  Bradley (Rte. 50 & I-57)  Refunded to State: $732,348  Niles (Touhy)  Refunded to State: $1,024,849  Bloomington (Veterans)  Refunded to State: $386,598  Total Refunded to State  (Annual & Terminations) >$8.6 Million PGAV 12
  • 13.  Property Tax/Sales Tax TIFs – What if there is a fund balance at closeout of property tax TIF, but the sales tax TIF runs to 2013?  Is it surplus?  Can the balance be applied to project costs in the sales tax TIF area? PGAV 13
  • 14.  Does the county and municipality have the same understanding of the TIF termination (e.g., 23rd year levy collected in 24th year)?  Revenue received after TIF Termination (e.g., Loan repayments or building demolition liens)? PGAV 14
  • 15.  Real Estate purchased with TIF funds?  If sold prior to TIF termination – deposit into TIF fund (Sec. 11-74.4-10)  After TIF termination – “shall continue to be held by the municipality after the [TIF] has been terminated” (Sec. 11-74.4-8) PGAV 15
  • 16.  Tell Your Story!  Project Successes  Private Investment Leveraged  Windfall Tax Revenues to All Taxing Bodies  What are Taxing Body’s Plans for Windfall?  Provide to Media  Provide at Final JRB Meeting  Provide to ITIA for Compilation PGAV 16

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