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At the annual meeting of the Joint Review Board, held on Dec. 16, 2011, City officials provided information about Evanston’s five active tax-increment financing (TIF) districts: Downtown I or Washington National; Southwest; Howard-Hartrey; Howard-Ridge; and West Evanston.
The Joint Review Board is composed of representatives of all taxing bodies with interest in the TIFs, such as the City, the two public school districts, Cook County and others.
Under certain conditions, a municipality may create a TIF district to foster economic development. During the life of the TIF, usually 23 years, the tax increment – the difference between the taxes on a parcel as improved and unimproved – can be used for public improvements within the TIF. In Evanston TIFs, the City shares the “base” property tax revenues – the amount before the property was improved – with the other taxing bodies but uses the property tax increment for improvements within the TIF.
When a TIF district is closed, surplus funds are distributed to the interested taxing bodies on the same pro-rata basis as property taxes are allocated, public school districts benefit in an additional way: The incremental equalized assessed valuation (EAV) is regarded as new property and not subject to tax caps.
The Maple Avenue garage, the Sherman Avenue garage and the Levy Center are examples of public buildings paid for by TIF funds.
Downtown I (Washington National) TIF
The Downtown I or “Washington National” TIF was created in 1994 after the Washington National Insurance company left Evanston. It encompasses sections of Benson, Sherman, Orrington and Chicago avenues roughly between Church and Davis Streets, in some cases extending south or north for less than a block.
In its original form it included the development on the west side of Chicago Avenue south of Church Street, including the Whole Foods North grocery store and the Park West apartment complex.
City Council subsequently extended the boundaries of the TIF to include the west side of Sherman Avenue north of Davis Street, as well as Fountain Square, with an eye toward rehabbing Fountain Square and possibly other properties with TIF funds.
The Sherman Plaza development, including the public Sherman Avenue garage, were built in the expanded TIF.
Construction of a proposed 38-story retail/residential tower at 708 Church St., approved by City Council a few years ago, is expected to begin in 2013.
Over the past year, City Council authorized the use of TIF funds for “studies and projects related to area redevelopment,” the annual report said. These included a feasibility study for a performing arts center and for a performing arts district in the downtown area, façade improvements and sidewalk replacement.
The EAV of the Washington National TIF was $25.7 million; its present EAV is $103 million, according to the report.
The Howard-Hartrey TIF
The Howard-Hartrey TIF was created in 1992 on the site of a largely vacant warehouse owned by Bell & Howell. The TIF was created to help with the cost of demolition and site remediation, City officials said. The area is now a major shopping plaza, home of the big-box stores Jewel, Target, Best Buy and Office Max on Howard Street just east of McCormick Boulevard. Over the past two years, Target, Jewel and Best Buy each invested significant amounts of money in renovations, City officials said.
The TIF will expire in 2015, but there has been some talk of closing the TIF as early as next year. The Administration and Public Works Committee is scheduled to discuss this matter at its Jan. 23 meeting.
The Howard-Hartrey TIF fund currently has a surplus of about $1.3 million, which would be distributed to the taxing authorities if the TIF is closed. The two school districts would get about two-thirds of the surplus, with the City and other taxing bodies sharing the remainder.
The beginning EAV of the Howard-Hartrey TIF was $7 million; its present EAV is $24.6 million, according to Cook County records.
This TIF encompasses only part of the Main-McCormick shopping plaza, and Sam’s Club is one of the few retail establishtments there. Ward Manufacturing, a steel-stamping company that has been in business in Evanston for more than 60 years, recently chose to remain in and expand its business in this TIF district. To help cover expenses associated with the expansion, the City awarded the company $700,000 in TIF funds. The allocation was structured as a reimbursement agreement for certain costs associated with the expansion, City officials said. Ward Manufacturing officials committed not only to staying in Evanston but also to hiring some Evanston residents.
Under an intergovernmental agreement between the City and the two school districts, District 65 received $504,000 from TIF funds last year, and District 202 received $336,000.
The beginning EAV of the Southwest TIF was $1 million; its present EAV is $8 million, according to Cook Count records.
The 17-story high-rise apartment building called 415 Howard is the centerpiece of the TIF. The owners, Crossbeam Capital and Concierge, received regional recognition last year for their management of the building. The building has a fitness center, a business center and a view of the lake from each apartment.
The Howard/Ridge TIF extends along Howard Street from Ridge Avenue to the CTA tracks and stretches a few blocks north on Chicago Avenue. It was created to kick-start economic development along this section of Howard Street.
Since February, the City has purchased several properties in the TIF district (see Dec. 21, 2011, RoundTable) and is hoping that entrepreneurs will lease and eventually purchase the properties. These purchases were made with a combination of Economic Development and TIF funds. City officials say they are talking with a theatre troupe and with other groups of businesspeople who wish to open a wine bar and a restaurant. The City may allocate up to $900,000 in additional funds to help foster development in that area of Howard Street.
Under an agreement with the school districts, the owners of 415 Howard do not have to reimburse the school districts for any school-age children living in the building – something otherwise required by amendments to state TIF law. The City further agreed to allow the owners to keep all the tax increment for the first five years, once the building was 90 percent rented, City officials said. Because that level has been met, the payments to the TIF fund will be temporarily reduced.
The EAV of the Howard-Ridge TIF when it was created in 2004 was $5.9 million. The present EAV is $15.5 million, according to Cook County records.
West Evanston TIF
Evanston’s newest TIF – and its largest in terms of land area – stretches like an elongated parallelogram along Dodge Avenue from Simpson Street to just south of Greenleaf Street.
At Church Street and Dodge Avenue, often said to be the heart of the City’s West Side, several small businesses have either taken hold or continued, Ebony Barber Shop and Church Street Barber Shop, BooCoo Café and Culture Center and the Church Street Village townhome development among them.
The building at 1817 Church St. is on the verge of being sold to a contractors’ cooperative. Some residents in the area had hoped that it could be rehabbed into an African American museum and cultural center. Efforts to create a cultural center there several years ago were largely unsuccessful, and the building has been vacant for several years. The contractors’ cooperative would undertake the rehab of the building as “sweat equity” in addition to the purchase prices.
Last year the City purchased the properties at 1708 and 1710 Darrow Ave. Affordable housing created through the Neighborhood Stabilization Program (NSP2) may be constructed on this site, which is now vacant land.
Farther south, businesses in the Dempster/Dodge/Florence/Crain area have coalesced into the West Village Business Association.
The beginning EAV of the West Evanston TIF was $37.4 million. The present EAV is $45 million.
The table below shows the year each of the City’s TIF District’s was formed, the EAV at that time, and the EAV in 2010. The data is taken from the Office of the Cook County Clerk.