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It took the full 23 years to transform Evanston’s flat west downtown into the busy multi-story commercial and residential district it is today. But that tax-increment financing (TIF) district has been “a raging success,” City planner Dennis Marino said at a meeting of the Joint Review Board on Dec. 17. The Joint Review Board, composed of representatives of the taxing bodies who share the taxes on Evanston residents’ property tax bills, meets annually to learn about the progress of Evanston’s six TIF districts.
During the life of a TIF – typically 23 years – the City may use the full amount of the tax increment, or difference between the tax on the property as improved and unimproved, to pay the cost of public infrastructure, which may make the TIF district more attractive for development. Evanston has six TIF districts, and the Downtown II TIF – located primarily along Maple Avenue between Church and Emerson streets – will close on Dec. 31.
Outside of Chicago, said Mr. Marino, this TIF, called Downtown II, was “one of the strongest TIFs in the state. … The City created a retail corridor along Maple Avenue, with a movie theater complex that has about 1.2 million ticket sales a year.” He said the City recently made streetscape improvements to Maple Avenue and widened the sidewalks to “enhance the pedestrian experience.”
A Brief History of Downtown II
In the 1980s, the City and Northwestern University contributed land along Maple Avenue south of Emerson Street to create a Research Park. At that time, the area was home to a Dominick’s food store and large parking lot, the Levy Senior Center, the City’s incinerator and its animal shelter, Mr. Marino said.
The intent of the Research Park was to attract small or startup high-tech companies to Evanston. Startups would be nourished in an “incubator” then, it was hoped, fledge into business in Evanston. The City created a tax-increment financing (TIF) district in the area so it could fund public improvements and attract businesses.
An economic downturn and other factors held the dreams of a full-blown research park at bay, but the incubator concept is retained in two separate buildings in Evanston – one on Davis Street and one on Chicago Avenue – owned by Charles Happ and managed by Tim Lavengood.
In the late 1990s, the Research Park partnership between the City and the University was dissolved. The City chose Arthur Hill to develop the south end of the property into a commercially viable area and relocated the Levy Center to its present site at Dodge Avenue and Mulford Street in James Park. Because the Levy Center and the proposed new developments were in the TIF district, the tax increment – the difference in the amount of tax paid on the property as improved and unimproved – was used to construct the Maple Avenue garage, relocate the Levy Center and some businesses and for other public purposes.
When the TIF closes, said Assistant Manager Martin Lyons, the equalized assessed valuation (EAV), of the property in the TIF district will be about $137 million, compared with the $2 million at which it began.
The main development in the Downtown II TIF is Church Street Plaza, composed of the retail and residential area along Maple Avenue between University Place and Church Street, wrapping east along both sides of Church Street to the CTA viaduct.
With the closing of the TIF, the property taxes on all the new residential and commercial property will be shared among all the taxing bodies.
State-mandated tax caps restrict the tax levies of the two school districts to a certain rate, which is tied to the consumer price index, but in the first year in which new or improved property is added to the tax rolls (such as when a TIF is closed), that property or the enhanced value of the improved property is not subject to the tax caps. With the closing of the TIF, the two school districts will be able to add about $135 million of new EAV to their tax bases.
Bill Stafford, chief financial officer of Evanston Township High School, said, “The high school will get $1.5-$2 million in additional property tax revenues. The timing of this is incredible.”
Mary Brown, finance director of District 65 said that the school district would get a slightly greater amount, because of the greater number of students. She echoed Mr. Stafford’s appreciation of the money and the new property on the tax rolls.
In the north end of the TIF, research is carried on. Three other buildings, including one used by Evanston Hospital for research, remain in the north part of the district.
On Dec. 18, Mayor Elizabeth Tisdahl dedicated the public art piece “The Encounter,” created by Hubertus von der Goltz, atop the Maple Avenue garage. The dedication took place on the same day that the City announced major cutbacks and program and personnel cuts. Referring to the balancing act of the two figures in the sculpture, Ms. Tisdahl said the dedication of the sculpture helped to balance the grimness of the budget cuts.