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Tax Increment Financing (TIF)
The Village created two TIF districts in 1986 and a third in 1990 to facilitate redevelopment and stimulate new investment in deteriorating areas or potentially problematic sites. TIF districts enable a municipality to borrow against the future tax revenues of an area to fund a variety of costs associated with the redevelopment process. During the time that a TIF is in place, all affected local taxing bodies continue to receive their shares of the taxes on the initial assessed valuation of the district. Only the additional tax revenue, or increment, is used to fund redevelopment expenses. TIF funds can be used to pay for property acquisition, site preparation, utility connections, building rehabilitation, infrastructure improvements, environmental cleanup, financing charges, and other expenses in connection with private investment.
The three redevelopment areas where TIF has been used in Skokie are:
- Touhy/Carpenter District - This site was previously the location of the largest industry and corporate headquarters in the Village, the AT&T Teletype facilities. AT&T had at one time employed about 4,000 people in the 1.2 million sq. ft. plant on a 60 acre site bridging the border of Skokie and Niles. Due to changing technology and the need to consolidate operations, AT&T vacated the facilities in 1987-88. The site was sold to a commercial development partnership and was redeveloped as the Village Crossing Shopping Center in 1989-90. TIF funds were used to pay for the extensive peripheral right-of- way improvements, traffic signalization, and site preparation costs. A $6 million bond issue was retired through TIF funds. The final infrastructure improvements were completed in 2002, and the TIF was then terminated seven years earlier than the Illinois legislation would have allowed.
- Church/East Prairie District - TIF was used to purchase property, demolish buildings, clear sites, rehab existing structures, and pay for various infrastructure improvements and site preparation costs. A former deteriorated and mostly vacant commercial area has been transformed into an attractive, mostly residential area with 60 new condominiums and 31 town homes. A small commercial strip center was retained and renovated. This project was completed in 2003 with the installation of a new traffic signal at the intersection. The public debt was completely paid off by the incremental taxes produced by the new development. This TIF district was terminated in 2003, six years earlier than the legislation would allow.
- Downtown Skokie - By 1990, the Downtown Skokie commercial area was exhibiting obvious signs of deterioration of both public and private property. There were 18 commercial ground floor vacancies, and most of the fashion retailers that had made Downtown Skokie a popular shopping destination in the 1950s to 1970s had either moved or closed their businesses. TIF funds were used to acquire and clear redevelopment sites, underwrite land costs, rehabilitate existing commercial structures, renovate the streetscape and public parking, and pay some of the design fees and consulting costs associated with the redevelopment effort. The Village has achieved several major new developments, numerous renovated commercial buildings, and a completely new streetscape system. Vacancies have decreased and new retail and housing have sparked the vitality of the area. Efforts are continuing to revitalize this historic center of the community. In 2005, a substantial part of the original TIF District was disconnected so the impacted school districts and other taxing districts could begin to receive additional tax revenue. The balance of this TIF District will remain in effect until 2013.
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