Morton Grove residents flock to learn about proposed TIF district

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Updated: March 10, 2012 8:05AM

Morton Grove residents packed the American Legion Memorial Civic Center’s main meeting room to learn more about a proposal to redevelop the Prairie View Plaza shopping center.

The Morton Grove Village Board of Trustees is considering creating a new tax increment financing district that would include the 25-acre parcel on the southeast corner of Dempster Street and Waukegan Road.

About 20 of 120 people attending the Jan. 30 workshop quizzed village officials about the proposed plan, which calls for demolishing and rebuilding the center in two stages and, in the process, moving the buildings back 20 to 30 feet south to make room for more parking.

Village President Daniel Staackmann noted no decisions have been made, and the workshop was one of many steps in the process of creating a TIF district.

“We’re here to clear up rumors, and to put facts on the table,” he said.

Addressing a question from the audience, interim Village Manager Ryan Horne said the proposed plan would not increase the village’s sales-tax rate.

The rate is 9.25 percent for general merchandise.

Responding to a concern that the village would be subsidizing the redevelopment plans of Federal Construction, a family-owned private entity, Steven Friedman said the proposed plan calls for a “pay-as-you-go” system in which the village would not be issuing bonds. Friedman is president of Chicago-based SB Friedman and Co., which works with municipalities on TIF projects.

About a half-dozen people wanted to know if the proposal would incorporate the Miami Woods forest preserve that borders the plaza property, making the shopping center more aesthetically appealing.

Alan Saposnik, the plaza’s property and development manager, said retailers have certain set expectations for parking, storefront space and facade appearance.

“They won’t pay for extraneous costs,” he said.

Addressing a question about what kind of tenants the plaza owner wanted to attract, Saposnik offered such examples as general merchandise, arts and crafts, electronics and possibly a revamped Dominick’s Finer Foods grocery store.

He said he would be looking outside Morton Grove, perhaps courting businesses along Touhy Avenue or Golf Road, and would not be siphoning off other Morton Grove shopping-center tenants to fill Prairie View Plaza storefronts.

“That would defeat the purpose” of attracting new businesses to the village, he said.

Responding to a few residents’ concern that a new TIF district would place a financial burden on Golf School District 67, Horne said the village most likely would enter into a revenue/sales-tax sharing agreement with the district, as the village has in the past.

Another resident asked about “porting,” in which revenue from a successful TIF district is shared with an adjoining district.

The proposed Prairie View TIF district borders both the Waukegan Road district to the north and the Lehigh/Ferris district to the southeast.

Friedman said porting can achieve common improvement of both districts by moving funds, but the move must be made to an adjoining TIF district.

Two people wanted to know why the proposed plan did not include the LA Fitness facility.

Saposnik said that while the health club draws a crowd, its members take up 25 percent of the parking, do not frequent neighboring businesses and make parking more difficult for those want to shop at those businesses.

According to the Illinois Tax Increment Association, in a tax increment financing district a base level of property-tax assessment is established, and increased revenues generated by increases in that assessed value due to expansions, improvements or new developments within the district are directed into a redevelopment fund, established and controlled by the municipality.

These funds then can be used for qualified redevelopment costs within the district, such as infrastructure improvements and other incentives.

The downside for other taxing bodies, unless otherwise negotiated, is a freeze on the amount of tax dollars received, as additional funds generated from increased property values are used to spur additional redevelopment in the TIF district.

Once the district is established, it remains in effect for 23 years unless the municipality terminates it earlier or seeks state legislative approval to extend it.

Municipalities can use TIF revenues for redevelopment plans, property-assembly costs, financing costs, relocation and for as much as 30 percent of interest costs incurred by the developer.