The City of Aurora’s draft Route 59 Corridor Plan covers a large area west of Route 59, from Montgomery Road to the train station.
All of that area sits within District 204’s boundaries, and with Aurora’s study showing market demand for over 5,000 new residences – that could be a lot of new students entering the already-crowded 204.
“The number of students they say that could come out of their higher density housing, we’ve talked to the cities, not just Aurora but also Naperville, about the fact that we see more students coming out of those than the generation tables show that either city uses,” said District 204 Superintendent Karen Sullivan.
Although Aurora’s plan does not specifically call for the use of tax incentives for development, the board received a presentation about the common tools and how they work.
The first is a property tax abatement. Limited to a 10-year term, it reduces the amount of property tax a landowner has to pay, and each taxing body can opt in or out of the abatement.
The second is a Tax Increment Financing, or TIF District – which usually lasts for 23 years, but can be extended up to 35. TIF districts are meant to help redevelop areas in danger of, or currently experiencing blight. Each governing body within a TIF district’s area has a vote on the TIF district’s review board, but a municipality can approve one even without a positive recommendation.
A TIF district creates a fund for the municipality that controls it, which is used to pay for improvements within the TIF’s boundaries. Money for that fund comes from incremental increases in property values over the TIF district’s life.
Essentially, school districts and other government bodies only bring in taxes based on property values in the TIF at the time it was formed. As it is developed and its value grows over the years, property taxes are still collected, but the new revenue is sent to the TIF fund and not back to schools, parks, and all other government bodies.
“With a TIF, all the growth is essentially held in advance for 23 years. At the end of the 23 years you do get the new property, and that can be a positive thing, but there is that 23-year delay,” said Ares Dalianis, an attorney with Franczek Radelet Law Firm.
If a TIF district includes residential development, it brings in new students without bringing in new revenue to help pay for their education.
That’s a concern as District 204 is already financially strained – they are only 80 percent funded, or $78 million short of implementing everything the Evidence Based Funding Model calls for.
Going forward, Dalianis recommended 204 begin to retain a consultant specialized in this field.
“We have to be the good stewards of the Indian Prairie taxpayers in figuring out what those implications are for our school district and sharing those implications with the city in hopes they take them into consideration,” said Sullivan. “And we have every belief that they will, but we have to be prepared or we’re not doing our job.”
A recent example of a TIF district in Naperville is the Water Street Development.
Naperville News 17’s Blane Erwin reports.
