Palatine TIF district might have first surplus disbursement
Palatine village officials say they might be able to distribute the first surplus from a tax increment financing district on the north end of town next year, aided by about $1.9 million left on the table when the Hyundai dealership there was bought by AutoCanada.
The Rand/Lake-Cook Corridor TIF District was created in 2012 and covers 110 acres, including the dealership.
So far, the only TIF project within the district was the building of the Hyundai dealership that opened around early 2014. The village paid a total $3,171,000 under an agreement with the original owner, Patrick Dealer Group, Assistant Village Manager Mike Jacobs said.
In a TIF district, property tax revenues that normally go to local taxing bodies - such as the village, school and park districts - are frozen at existing levels. Property tax revenues beyond those levels, stemming from increases in the TIF district's equalized assessed valuation, are used to finance improvements within it.
Palatine's agreement with Patrick Auto Group was for $5.25 million in financial assistance, including $2 million for land acquisition, $1 million upon occupancy, and $2.25 million to be paid as surplus tax revenues became available, Jacobs said.
In 2015, Patrick Hyundai was bought by Grossinger Auto Group, and the village paid about $170,000 to Patrick based on the original agreement.
The agreement was transferred to Grossinger Auto Group with an amendment to reduce the financial assistance by $112,000.
Grossinger was bought by AutoCanada in 2018, but the TIF agreement with the village was never transferred to AutoCanada, so the village no longer has an obligation to pay the remaining $1.9 million, Jacobs and Village Manager Reid Ottesen said.
Mike Borys, chief financial officer for AutoCanada, did not return a request for comment.
The village didn't know about the sale to AutoCanada until after it happened, Jacobs said.
"No contact was made to the village by Grossinger or AutoCanada regarding the most recent sale of the dealership, the redevelopment agreement or any related issues, and the redevelopment agreement ultimately was terminated," he said.
Ottesen echoed that, saying the village had nothing to do with those private business negotiations, and the TIF redevelopment agreement was a matter of public record.
The village hopes developers will come forward with more projects in the Rand Road/Lake-Cook Corridor TIF District, particularly for a couple of large properties west of Rand Road and south of Lake-Cook Road, Jacobs said.
The taxing bodies within a TIF district comprise the joint review board. Ottesen told the board last week the village will share its projections regarding a surplus disbursement no later than October.
A car dealership is looking at establishing itself in the area, but it's unclear in which of two TIF districts there, Ottesen said. The village has five TIF districts altogether.