With the impending expiration of the Madison Street and downtown Oak Park Tax Increment Financing (TIF) districts, almost all Oak Park taxing entities are planning for additional property tax revenue that has until now been diverted for economic development efforts.
However, the Village of Oak Park, citing fiscal discipline, does not plan to capture funds from the TIFs, opting to keep the village tax levy increase to 3 percent.
"We kind of laid that math out for the village board, but the entire budget that, as the manager, I'm recommending is at the 3 percent and does not capture the $114 million in new EAV [equalized assessed value] from the TIFs coming into the big picture," said Cara Pavlicek, Oak Park village manager.
According to the recommended 2020 village budget, if the village government did choose to capture the $114 million in new EAV, the funds would "generate an additional $2.4 million, or an additional $1.4 million over the requested capped 3 percent property tax levy which equates to a 7 percent levy increase," said Pavlicek.
Fiscal discipline is the motivation for the village government to not capture the increase, she said.
"I think they've been pretty clear that the purpose of economic development in growing the EAV was then that we, shall we say, keep the amount of money we're collecting the same, so the pie should stay the same and the slice of everyone's pie – in other words, each homeowner's tax bill – is a little smaller," said Pavlicek.
Village government appears to be the only taxing body that is prescribing to that fiscal recipe. Five other major taxing bodies all intend to capture a slice of the TIF fund pie.
"I'm sure we're the only entity following the recipe and I'd bet money that we have more people yelling at us about our fiscal discipline than anyone else," the village manager said. "And I don't mean to sound a little bit bitter about it, but it is, it's interesting."
The Park District of Oak Park intends to capture approximately $315,000 from the TIFs. Parks staff also recommended raising its levy by 1.9 percent in addition to the TIF influx.
"We would also capture the funds from the expired TIF. The increased amount will equate to about $4 per $100,000 home value," said Diane Stanke, marketing and customer service director for the park district. "The 1.9 is actually lower than the two previous years, which we actually increased by 2.1 percent"
The park district already collects $400,000 annually in TIF rebates, bringing their TIF total to $715,000, according to Stanke.
"Of course we are good stewards of our tax dollars here and we always want to use our tax dollars as best we can to benefit our community, so we've come up with three different ways in which we're going to spend that $315,000 to benefit our community," said Stanke.
If the budget is adopted, funds will be used to offset the gradual rise in the minimum wage to $15 per hour, which Stanke said will cost the parks department about $160,000 annually.
The parks are also freezing program fees for the next two years, offering some monetary relief for participants. The TIF funds will compensate for the revenue lost from not raising fees.
Thirdly, the TIF funds will help subsidize the Clubhouse, its costly childcare program. "We're coming out with what we call a childcare discount program, where anyone with a household income of $100,000 or less will be eligible for this program. Depending on their income, they will get a break in the fee for our childcare program," said Stanke.
These are only staff recommendations. The parks budget for 2020 has not yet been adopted, so none of this has taken effect.
The Oak Park Public Library plans to capture $690,000 in TIF revenue, according to Matt Fruth, library board president. The library intends to use the money to make computer system upgrades and to increase salaries of lower paid workers.
Unlike the parks department, the library does not have any income from fee-based programming.
"One of the considerations that we have that is different than the village and the parks and the schools is that, I think, in terms of funding sources, we have, I think by and large, the largest reliance on property tax revenue as a portion of our revenues compared to everyone else," Fruth said.
Both District 97 and District 200 also plan on capturing revenue from the expired TIF districts.
Rob Grossi, D97's financial consultant, said that the district's 2019 tax levy will capture all of the available taxes from the expiring TIFs. The district stands to receive about $5.7 million from the expiration of the two TIFs and new taxable property. About $4.1 million will come from the expiration of the downtown TIF and about $1.2 million from the expiration of the Madison TIF. The remainder, roughly $376,000, will come from new taxable property.
District 200 will capture around $800,000 of additional revenue as a result of the expiration of both TIFs, said Cyndi Sidor, the district's chief business officer.
Answer Book 2019
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