Village of Homewood officials held the first Hot Topics meeting, focusing on Tax Increment Financing (TIF) districts on Wednesday at the Irwin Center from 6 to 7:30 p.m.
Hot Topics is intended to be a series of informal workshops to help residents better understand how village government works.
Staff first introduced Geoff Dickinson, American Institute of Certified Planners with SB Friedman Development Advisors. Dickinson, an expert in TIF districts, explained to the audience what TIF districts are and how they work.
Village staff and Dickinson answered numerous questions from residents in the audience where an informative discussion took place to help residents better understand TIF districts. The goal was to address misunderstandings and disinformation on TIFs.
Dickinson went over what a TIF district is, and how it is used by villages to economically develop and redevelop spaces, as well as to enhance the tax base.
“Villages don’t have a lot of tools for economic development, it’s one of the few tools with high financial power to make things happen fundamentally that wouldn’t otherwise happen,” Dickinson said.
When a TIF district is created, the equalized assessed value of the properties within its boundaries becomes a baseline. The taxing bodies — like village, schools, libraries and parks — continue to receive tax revenue from properties within the district based on the EAV when the district was established. As property values rise during the life of the district, the revenue from the EAV above the baseline goes into a separate fund that is used to pay for qualified improvements designed to aid economic growth.
According to Dickinson, TIF districts are typically created in a village’s downtown area and commercial corridor, as well as industrial parks. The standard term of a TIF is 23 years. Revenue from TIF funds can be used to reimburse developers and pay for new projects, and fund improvements, he said.
Contrary to popular belief, TIFs do not raise property taxes for residents and businesses, he said. TIFs are not a tax increase, therefore taxpayers pay the same amount as prior to the TIF’s existence, Dickinson said.
Homewood Director of Economic and Community Development Angela Mesaros and Noah Schumerth, assistant economic and community development director, led a presentation and discussion with residents on TIF districts in Homewood.
According to Mesaros, there are currently seven TIF districts active in the village. TIF districts are established for properties that have been vacant long-term and need redevelopment, she said.
The Downtown Transit-Oriented Development (TOD) TIF district was created to generate revenue to assist with redevelopment of the Hartford building, which was built on the site of the Triumph building, Mesaros said.
TOD is a type of development that creates more places that are within walking distance and near transit services to promote growth, Schumerth said.
TIFs are based on property taxes, but the village gets most of its operating revenue from sales tax, Homewood Village Manager Napoleon Haney said.
“There’s a group out there of residents that don’t understand a lot about TIFs, that believe the misinformation and the disinformation,” Haney said.
“I feel like I have a better understanding now,” Homewood resident Amy Crump said, adding that she appreciated the Hot Topics idea. “I like it, you guys should do it again.”
Some possible topics for future Hot Topics meetings held by village staff will include Class 8 and taxing bodies/equalized assessed value, staff said.
