The city of Aurora will continue to encourage growth around Chicago Premium Outlets by looking to extend roads, add greater access and possibly develop a hotel and convention center.
A special tax district that helped the outlet mall develop into a hot spot for local and international shoppers is set to expire at the end of the year, and it will do so with an estimated $16 million to $21 million in the bank.
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Officials recently approved a plan for distributing the remaining money to other planned projects near the mall. Up to $21 million in surplus funds will be transferred into two new redevelopment areas created last year, one east of the outlet mall and one to its west, Finance Director Brian Caputo said.
The redevelopment areas are classified as tax increment financing districts, or TIFs. The districts are redevelopment project areas that allow municipalities to support growth of businesses and infrastructure in blighted, decaying and underperforming areas. Money to be used for redevelopment comes from future tax revenues that would not have been generated without extra investment in the area.
The transfer of funds from the expiring TIF to two new ones is possible because the city has identified projects in both newly designated areas that could benefit from the funds, Caputo said.
Up to $16 million will be transferred into the larger redevelopment area west of the outlet mall, and up to $5 million will go into the smaller area on its eastern border.
"It's a great start because usually when you start up a TIF, one of your biggest hurdles is that there's no money in the TIF to get things going," said Alderman Abby Schuler, whose ward includes the expiring district and the two new ones. "There are real solid projects to use this money toward that will be revenue-generating to the city."
Once an area is designated a TIF district, taxes paid by property owners are handled differently. When a property increases in assessed value, taxes paid on the extra value go to a fund that can be spent only on certain expenses within the district.
Transferring extra funds at the end of the year will allow continued reinvestment in the area around the outlet mall, which is planning an expansion, likely into the redevelopment area to its east.
"The expectation there is that the outlet mall will expand into that area," Schuler said. "If they don't use all of it there could be the potential for some other related convention use, hotel use -- something that would complement the mall."
Projects identified as possible in that area total $14.1 million for property acquisition, stormwater management, a new north-south road providing access to the east side of the area, and improvements to East Bilter Road.
Possible projects in the redevelopment area west of Chicago Premium Outlets total $19.1 million for extension and realignment of Corporate Boulevard, property acquisition, and development of a hotel and convention center. Negotiations between the city and potential developers are ongoing for projects in both areas set to receive money from the expiring TIF, Caputo said in a memo.