November 12, 2024
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DeKalb schools consider city’s plan to revamp Fourth Street corridor

If approved, South Fourth Street TIF could generate $5.7M in revenue by the time it ends in 2048, city documents show

By Megann Horstead
A traffic signal at the corner of Fourth and Taylor streets in DeKalb. A new tax increment financing (TIF) redevelopment plan area is proposed for Fourth Street from Taylor Street south to the Illinois Toll Highway 88. City staff have said a new TIF would help improve blighted and outdated buildings in the area, encouraging new development.

A traffic signal at the corner of Fourth and Taylor streets in DeKalb. A new tax increment financing (TIF) redevelopment plan area is proposed for Fourth Street from Taylor Street south to the Illinois Toll Highway 88. City staff have said a new TIF would help improve blighted and outdated buildings in the area, encouraging new development. (Megann Horstead)

DeKALB – DeKalb School District 428 leadership is exploring whether it should opt into a proposal with the city of DeKalb which could overhaul South Fourth Street using tax increment financing, part of the city’s plan to spur new development in that area.

A TIF district is a tool used to spur economic development in an area that otherwise may not see activity. Property tax dollars are pooled over time and then used to rejuvenate dilapidated buildings, or aid new development and businesss. The DeKalb City Council also has considered whether to approve what its calling the South Fourth Street TIF District. No final vote has been taken yet.

During their meeting this week, members of DeKalb School District 428 school board were briefed on what the proposed agreement would entail. City leaders need neighboring taxing bodies to opt in also.

The proposed TIF District could run along South Fourth Street, from Taylor Street to Interstate 88.

District Attorney Gino Galluzzo said it’s mainly commercial properties but there are some residential properties in the mix.

Some key properties bound by the proposed TIF District include Founders Elementary and Lincoln Elementary schools and the DeKalb School District 428 district offices.

Nearby properties excluded from the proposed redevelopment project area include Huntley Middle School and the Beyond One Barb Transition Center.

If approved, the South Fourth Street TIF District is estimated to generate $5.7 million in revenue by the time it ends in 2048, city documents show.

The plan stipulates that the city may not apply TIF funds toward administrative expenses. The city also has agreed to incorporate transparency reports.

Galluzzo said the district would like the city to give consideration to TIF-eligible expenses besides infrastructure.

“We want to see some other good things happen with those dollars,” Galluzzo said.

There are a number for eligible uses for TIF funds, including property acquisition, renovation, demolition, job training related to the TIF area, construction of public works or improvements, financing costs and more.

Galluzzo said, under the proposed intergovernmental agreement between the district and the city, District 428 would like to collect what they believe is their proportionate share of tax dollars for TIF-funded development. He said the district is asking the city to declare a TIF surplus for seven years beginning in 2026.

Public school districts typically make up the largest portion of a property owners’ tax bill each spring.

“The school district typically is about, I think, 60% roughly of the total tax bill,’ Galluzzo said. “So, that 30% we get our proportionate share of those dollars. We’re asking that after that 7-year period beginning in 2033, that they distribute 50% percent of the surplus. The idea is to allow them to begin to generate some income early on so they have those dollars available for roads projects or other projects they want to accomplish.”

A future vote on the creation of a TIF district is expected at a future date. Both the city and the school district would need to approve it to move forward.

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