Lombard has added a new strategy to its financial playbook that officials say will support redevelopment of 100 acres along Butterfield Road: including parts of the Yorktown Center shopping mall.
Trustees on Thursday unanimously approved a tax-increment financing district called the Butterfield Yorktown TIF, which will create a fund that can pay for infrastructure, roads and other property improvements within the 100-acre area through 2040.
"It's definitely needed," Village President Keith Giagnorio said. "It'll be a good stimulus for the village in that area."
The new district includes the JCPenney store within the Yorktown Center mall, part of the mall's ring road, a mostly vacant strip mall along the ring road called Yorktown Convenience Center, the Westin hotel, an office building on 22nd Street and a 27-acre property belonging to Northern Baptist Theological Seminary.
Bill Heniff, Lombard's community development director, said the seminary has moved most of its operations to Lisle and is looking to sell the land, which sits immediately east of Westin and the AMC movie theater at the mall.
Faced with a large, looming vacancy that would be hard to fill with a similar use, Heniff said the village looked to create the financing district, referred to as a TIF, to make redevelopment easier.
The seminary has not yet found a buyer for the land. But if or when it does, Heniff said the village will be able to offer assistance with certain infrastructure upgrades that could make repurposing the site less costly.
"We now have a resource for actually providing for assistance through our incentive policy," Heniff said.
In a TIF district, the assessed value of land is frozen for the purpose of calculating how much property tax dollars local governments receive. As property values increase, the difference between what the governments collect and the higher taxes the land generates is put into a fund that helps pay for certain improvements within the TIF district, such as roads and other infrastructure.
"It'll only help," Giagnorio said. "It's all synergy."
Property taxes flowing from the area in the TIF to the village, the park district, the library district and four school districts will be frozen for 23 years.
The land was eligible for TIF status because it was found by consultant Kane McKenna and Associates to contain obsolete buildings, deteriorating structures, excessive vacancies, inadequate utilities, lack of community planning and declining assessed values.
Village officials say they hope the area can be transformed into a mixed-use development focused on housing.
A budget for the TIF caps spending at $125 million, including an estimated $13 million on studies, engineering and site plans; $22.7 million to buy and assemble properties; $10 million on upgrading streets, sidewalks, lighting, traffic signals, stormwater management, sanitary sewer and landscaping; $14.3 million on financing; and $42.8 million for school and library districts if the area generates new residents.
The Butterfield Yorktown TIF is the village's fourth tax-increment financing district after a downtown TIF was established in 1989 and extended 12 years. Two TIFs were created on St. Charles Road in 2003 and 2004.