Editorial: Appropriate caution shown in approach to Hoffman Estates TIF

When a large corporate campus goes fallow, a host community must get creative to find ways to either carve up or repurpose the white elephant - and find ways to attract developers.

Hoffman Estates finds itself in this position with the 150-acre former AT&T office campus.

Village officials have created a joint review board to figure out what kind of incentives it might be able to offer while keeping peace with other government bodies. History tells us the latter isn't always easy.

And the clock is ticking. Both Hoffman Estates and Barrington Unit District 220 officials have been banking on a piece of legislation submitted by State Rep. Fred Crespo in February. HB5625, known as the Big Empties Site Act, would allow communities to designate an unused building or buildings that amount to at least 1 million square feet to be a Big Empties Site. The AT&T campus qualifies.

The bill would allow such breaks as an income tax credit equal to 25 percent of a developer's investment, a tax exemption on the purchase of computer software and an abatement of up to half the property tax.

The bill was kicked around for two months and has sat in Rules Committee for the past seven. It's a long shot to become law. And the developer wants to get started next year. As written, the Big Empties legislation would require the village to apply to the state before the end of this year to ask it be declared a Big Empties Site. Only then would the state be able to consider granting the status in 2019.

It may be that establishing a Tax Increment Financing District would fit the community's timetable better, but a TIF is not an ideal solution, and the affected parties are approaching the idea with appropriate caution.

With a TIF district, local governments receive property taxes based on the value of the property frozen at the time the TIF is enacted. That lasts for 23 years. Taxes collected on incremental increases in the value of the property are funneled back into funding public improvements on the property. That can be good for development, but it can be costly to schools and other government bodies outside the TIF area that must serve residents and businesses within it. Municipalities have the power to establish TIFs, and school districts, in particular, sometimes complain about an influx of students with no commensurate increase in property taxes to the schools to house and educate them.

Hoffman Estates Mayor Bill McLeod has said he feels excluding residential areas of a proposal on the table (including 375 apartments and 175 townhouses) from a TIF would ensure District 220 comes out of this mostly whole. School board President Brian Battle wants the district to do its own analysis. But the district isn't throwing up any road blocks at this point.

An incentive deal and purchase must be completed within six months of the Aug. 20 rezoning. It's good to see the village and the district trying to work together to solve this. We urge caution on both sides, with an eye on both the costs and the benefits.