S. Elgin condo developers ask village help on TIF costs
By Janelle Walker For The Courier-News January 22, 2013 7:48PM
Updated: February 24, 2013 6:18AM
SOUTH ELGIN — Since the River Crossing condominiums were finished in 2007, just 33 of the building’s 45 units have sold.
Because of the housing market collapse since then, Jim and Judi Tucker — who developed the old Tucker grocery store property beginning in 2004 — are asking the village to give them some help on paying back their portion of the Tax Increment Financing agreement.
“It was completed in the summer of 2007 … just before the Great Recession hit,” said Steve Super, the village’s director of community development.
“Since that time, the project has not sold out as fast as anyone had hoped at the beginning,” Super said.
A TIF district is a way of splitting property tax revenue between a set base that is paid out to all local taxing bodies and the tax increment, which is any tax money collected over the base. That extra money is used to finance improvements in the district .
The original TIF agreement assumed the units would sell more quickly than they did, and the Tuckers would pay $1.8 million for road improvements the village did to Mill, Woodbury, State and Gilbert streets surrounding the building.
Instead of paying that back in just five years, the Tuckers — working as River Crossing LLC — are asking the village for five more years.
In addition, they are asking for interest costs to be reduced from 6.5 percent to 4.9 percent — more in line with today’s interest rates, Super said.
The Tuckers were “pioneers” for developing the near-east side of South Elgin, said Trustee Mike Kolodziej.
“I would support you with this request. The economic climate didn’t work in your favor,” Kolodziej said.
The lengthened payback schedule would be a blow to the tax increment finance district’s long-term income, Super said.
However, because the land had buildings on it before the project started, it had a higher tax burden than did undeveloped, open land, he added.
The village board is expected to vote on the request next month.