The first stage of redevelopment envisioned in Aurora’s RiverCity plan would require a public investment of up to $77.3 million, according to a draft report on a potential tax increment financing (TIF) district released by city officials.
That investment would leverage far more spending by private developers, said city Finance Director Brian Caputo. Including public and private investment, about $450 million would be spent to redevelop RiverCity’s 40-acre core area south of Aurora’s downtown, he said.
Just how much of the $77.3 million, all of which would be eligible for TIF funding, would be paid by developers has yet to be worked out in ongoing negotiations, Caputo added.
“If the city had to pay $77 million, the project would not go forward,” Mayor David Stover said, adding that he is ready to withdraw his support if he determines it to be too costly.
The costs outlined in the report include $20 million to separate combined storm and sanitary sewers, $17.9 million to buy land and prepare sites for construction, and $11.5 million for infrastructure work.
They also include $10 million to reconstruct the North Avenue Bridge over the Fox River, $7.9 million for interest payments, $7 million to extend the FoxWalk, and $2 million for planning and professional services.
“A lot of those costs we would have incurred anyway, even if we decide not to go forward with the project,” Stover said.
Work the city has to do, but would schedule sooner for the project, includes sewer separations, bridge work and the FoxWalk extension.
Stover also said a sizable portion of the costs for the various projects, including the bridge, sewer separation and some of the infrastructure, could be funded by federal and state sources or paid for with other funding mechanisms.
The latest figures are contained in a 76-page draft report on a potential TIF district, which would cover RiverCity’s core area, prepared by Aurora and Kane, McKenna and Associates Inc. financial consultants.
In a TIF district, property taxes paid to local governments are frozen for up to 23 years. Additional taxes paid as land values rise go into a TIF fund, which is typically used to pay off bonds issued to finance land-acquisition, infrastructure and other development costs.
The RiverCity project envisions the redevelopment of 130 moribund acres south of downtown. It would be developed by Riverside Venture, an affiliate of Hawthorn Realty that includes Newcastle Ltd., in conjunction with Aurora Sports Venture, whose principals include Sportsman’s Park President Charles W. Bidwill III.
The core area, which straddles the river between Benton Street and North Avenue, would include a combination convention center, multipurpose sports arena and hotel. It also could include a free-standing hotel, recreational facilities and urban-style housing.
Kane, McKenna’s report concludes that the core area, which is made up of 72 buildings on 105 parcels, qualifies as a blighted area prime for redevelopment under the state’s TIF law.
It notes that the area’s assessed property value of $2.84 million in 1998 dropped 3.5 percent from 1997, compared to an overall 8.6 percent increase in city assessed valuation during that year. In the previous three years, the area’s property value rose far slower than Aurora as a whole.
If redeveloped as planned, the area’s assessed value would rise to $125 million, or a fair market value of $375 million, the report states.
The report also refers to one potential difficulty in developing the site. An environmental cleanup of an area slated for the core’s combination facility was estimated to cost at least $500,000 in 1991, the report states, adding that “it is difficult to predict how much remediation would cost in today’s market.”
Up to 41 residential units, including eight single-family homes and nine multifamily buildings, would be displaced by redevelopment, the report states. The city would have to come up with a plan to relocate the 93 residents living in those homes under a new state TIF law.
If development in the area resulted in an increase in students at local school districts, TIF funds would be used to pay for the additional “tuition,” the report states.
“In the next month, this plan will be finalized,” Kane, McKenna President Philip R. McKenna said.
Once the plan is complete, the city will hold at least one public hearing and present it to a joint review board, including other affected taxing bodies, before the council votes on whether to establish the TIF district.
That vote, which may also depend on separate redevelopment feasibility studies, would likely be taken in September or October, McKenna said.
