Mt. Vernon Register-News

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February 5, 2013

Two TIF districts fail to meet goals

After an annual review of the city’s four tax increment finance district, the Joint TIF Review Board determined two of the districts did not meet the goals of the districts during fiscal year 2012.

The two which were determined not to meet goals are the Homestead TIF, and the I-57/Route 15 TIF. Neibert said in the case of the I-57/Route 15 TIF, the district major project — the Drury Inn renovations and construction — came after the end of the fiscal year.

“The fiscal year ended April 31,” Neibert said. “There was zero in revenue last year, and no projects during the fiscal year. Three hundred forty dollars were spent to audit the district, putting it in the negs. Even though there were no funds, we are still required to audit it, by statute. After the end of the fiscal year, the Drury development, which is to build a new seven-story hotel, demolish the existing Drury, the old Denny’s building, the gas station, the Thrifty Inn and the property known as Behind the Pines and build a new restaurant, came through. But, it doesn’t count toward the 2012 fiscal year.”

The Homestead TIF district — which is a site specific, project specific TIF — also failed to meet the goals of the district.

“The district was formed in 2007 to support a proposed development on the former Homestead Golf Course,” Neibert explained. “The city entered into an agreement for development, and for economic reasons, the developers haven’t to date advanced the project. The formal agreement with the city expired in November, 2012, so there is no valid agreement existing at this time. ... We have had a meeting with the owners, and they are renegotiating agreements with individuals and we expect them to come forward and restructure their project.”

The project originally called for senior condominiums, and Neibert said after the results of a recent housing study which identified a shortage, the project is expected to be restructured for single family dwellings in the area.

It was determined the Industrial Park Conservation Area TIF met the goals of the development plan for the fiscal year, with the funds and infrastructure put into the district over the course of the year. Neibert said now that water, sewer and other infrastructure work has been completed in the area, he expects several projects to move forward.

The most successful TIF in the city is the Downtown TIF. Started in 2008, the equalized assessed valuation of the TIF area was at $12,648,502. At the end of the fiscal year, the EAV was at $14,226,615.

The beginning balance in the Downtown TIF fund for the fiscal year was $333,270; with $S245,116 received. Interest on the funds in the TIF were $401, with $744,181 available. However, Neibert said $434,111 had already been spent of the funds on TIF projects.

“Since the end of the fiscal year, we have allocated the rest of the funds,” Neibert said. “From the beginning of the district to the end of the last fiscal year, the district has seen $951,621 in private investments, and $542,375 in public investment.”

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