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posted: 10/26/2013 8:00 AM

Schaumburg entertainment district tax plan splits panel

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  • Schaumburg envisions the Renaissance Hotel and Convention Center as the centerpiece of a new suburban entertainment district.

      Schaumburg envisions the Renaissance Hotel and Convention Center as the centerpiece of a new suburban entertainment district.
    Mark Welsh | Staff Photographer


Taxing bodies and a citizen representative were deadlocked Friday on Schaumburg's proposed tax increment finance district to spur redevelopment near the Convention Center.

The first meeting of the TIF district's joint review board resulted in five yes votes, five no votes and two abstentions.

Local school districts led the criticism of the proposed TIF district on the basis of its size, scope and the unwanted potential of it shifting the property tax burden more toward residents.

"We support community development," said Dave Torres, associate superintendent for business in Palatine-Schaumburg High School District 211. "We want community development. But how do we balance that with the unintended consequence of the tax burden shift?"

He said his school district's tax levies aren't increasing as significantly as the share of them that homeowners pay, for a variety of reasons. Among these are tax incentives and successful assessment appeals by businesses.

The size of this particular TIF district, which includes plans for an entertainment district near the Schaumburg Convention Center, was a further concern to Torres.

While District 211 already has 11 TIF districts within its boundaries, this particular one would represent two-thirds of the total area for all of them, he said. It would be the largest TIF district in Cook County outside Chicago.

A TIF district works by freezing the amount of property taxes local governments receive at the level of the first year. As the land is developed and its relative value increases, the incremental increase in taxes goes not to those taxing bodies but to a municipally-held fund that pays for public improvements and other eligible expenses within the TIF district.

A TIF district expires after 23 years or when all public improvements have been paid off, whichever comes first.

Schaumburg's TIF district attorney, Kathleen Field Orr, said the village remains sensitive to the tax burden shift Torres highlighted.

But a key justification for TIF districts is that they attract redevelopment and thus higher tax revenues for local governments in the end, she said.

Just the promise of this TIF district has attracted Sunstar Americas Inc. and Zurich Insurance to build new North American headquarters in Schaumburg. The redevelopment plan for the whole area forecasts an increase in total property value from $213 million to over $1 billion.

So, while the shifting of the tax burden is happening already for a variety of reasons, a TIF district helps build future revenue, Field Orr said.

"At least, with the TIF, we have hope," she said.

Joint review board members who voted against the TIF district's eligibility were the representatives for District 211, Schaumburg Township Elementary District 54, Palatine Township Elementary District 15 and the Palatine Public Library, and public member Jo Keeley.

Keeley is president of the Walden Townhouses, where she has lived for 42 years, and works for the Walden Condominiums next door.

"This is about our homes," Keeley said. "I'm here for a sensitive reason, and a business reason."

Taxing bodies who voted in favor of the TIF district's eligibility were representatives for the village of Schaumburg, Cook County, the Schaumburg Park District, Schaumburg Township District Library and Schaumburg Township.

Harper College and the Palatine Park District representatives abstained, and Palatine Township's was absent.

Had there been a majority of "no" votes, the board would have had to meet again in a month to consider a revised plan.

But even if it again rejected that plan, the law allows that the TIF district could still be approved by a supermajority of the Schaumburg village board.

A public hearing on the TIF district is scheduled for 7:30 p.m. Nov. 20 at Schaumburg village hall, 101 Schaumburg Court. The village board is expected to vote Jan. 14 to create the TIF district.

The joint review board will meet annually until the TIF district expires.

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