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Legislative Alert: Oppose SB2298 - TIF / Redevelopment Project Area

Updated: Nov 4, 2021

APA-IL Legislative Alert

Legislative Committee American Planning Association – Illinois Chapter May 4, 2021


Senate Bill 2298 - the continuous battle against anti-TIF legislation

sketch of Illinois capitol with the words legislative alert overlaid

The bill, amends the Tax Increment Allocation Redevelopment Act of the Illinois Municipal Code and would eliminate the effectiveness of the one tool available to municipalities to enhance positive economic change.


As of 5/12/20: Senator Gillespie is withdrawing her proposed TIF legislation and will be forming a study group over the summer.


Thank you for helping to ensure that the necessary tools are available to Illinois and their municipalities for maintaining and increasing economic and municipal development to their respective communities and citizens.

 

Here is how you can advocate:


#1: Contact your legislators *NEW*

Through the American Planning Association's VoterVoice grassroots advocacy software, you can connect with legislators and ask them to vote for or against legislation that matters to our organization. Connecting with your elected officials plays an important role in building relationships between decision makers, helping us to stay relevant and in the forefront of an elected officials mind by showing our power in numbers.


IT'S EASY - JUST ENTER YOUR INFORMATION AND CLICK SEND!

 

Sponsors: Sen. Ann Gillespie (D. 27th District) - Sen. Melinda Bush (D. 31st District) Status: SB2298 is being scheduled for a Third Reading, deadline to schedule is May 7, 2021.

Summary: Amends the Tax Increment Allocation Redevelopment Act of the Illinois Municipal Code.

Adds two factors to the determination of a "blighted area" for improved, industrial, commercial, and residential buildings or improvements:

  • (i) if the redevelopment project area has had an annual average unemployment rate of at least 120% of the State's annual average unemployment rate; and

  • (ii) if the redevelopment project area has a poverty rate of at least 20%, 50% or more of children in the redevelopment project area participate in the federal free lunch program, or 20% or more households in the redevelopment project area receive food stamps.

Removes or modifies various factors from the definitions of "blighted area" and "conservation area" for improved and vacant areas.

Provides that a new redevelopment project shall have a completion date no later than December 31st of the 10th year after the ordinance was adopted (rather than the 23rd year) and may be extended to 15 years (rather than 35 years).

Provides that the joint review board and municipality shall approve surplus funds and extensions of redevelopment project area completion dates.

Provides that surplus funds shall be distributed annually within 90 days (rather than 180 days) after the close of a municipality's fiscal year.

Provides that a new or modified redevelopment project area that overlaps with any existing redevelopment project area shall not be approved.

Effective July 1, 2021.


Click here to read the Illinois Municipal League's letter to Sen. Ann Gillespie which provides more details on each of the proposed changes.

Why you should OPPOSE this bill:

This bill embraces a fundamental misunderstanding of tax increment financing (“TIF”) and the benefits TIF provides to communities across the state on a daily basis. If either bill becomes law, APA-IL believes that both the use of TIF by municipalities and the ability of TIF to drive positive economic change Illinois communities will decrease markedly.


The APA-IL has the following concerns with SB2298’s proposed changes to the Tax Increment Allocation Redevelopment Act of the Illinois Municipal Code:

  • Shorten timeline for TIF expiration. SB 2298 significantly shortens the completion date of a Redevelopment project from 23 years to 10 years and decreases the project extension from 35 years to 15 years. A shortened timeline does not allow for adequate return on investment to repay bonds or the necessary time for planning long term projects across Illinois.

  • Determination of a blighted area. SB2298 adds two factors to the determination of blighted area and removes or modifies various definitions of "blighted area" and "conservation area" for improved and vacant areas. The additional two factors and definition changes would not provide an accurate picture of a specific redevelopment project area.

  • Overlapping Redevelopment Project Areas and Distribution of Surplus Funds. Provisions of SB2298 that disallow overlapping project areas would affect countless redevelopment projects currently underway and the timeline outlined for distribution of surplus funds does not take into account the varying fiscal years and internal controls in Illinois local government.

The American Planning Association – Illinois Chapter (APA-IL) stands with the Illinois Tax Increment Association (ITIA) to advocate for legislation that helps communities achieve their full potential. We are committed to work with Illinois legislators to create a greater understanding of TIF and how this valuable tool can help build great communities in Illinois.


Recommendation: Contact your state legislators to OPPOSE SB2298.

 

Questions? Please contact David Silverman, AICP, APA-IL Legislative Chair at dsilverman@ancelglink.com or Tom Henderson, Executive Director of the illinois Tax Increment Association at thenderson@illinois-tif.com. Find out more about the APA-IL Legislative Committee at ilapa.org/legislative-committee

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