As plans for investment into its downtown continue, Batavia is pumping the brakes on a proposed tax increment financing, or TIF, district that, if created, would include some future development projects already being planned for the area.
At a meeting last week, the City Council opted to temporarily pause moving forward on the creation of the new TIF District 7, which is set to include a segment of Batavia’s downtown, largely west of the Fox River. The proposed redevelopment area generally includes property south of Wilson Street, north of Union Avenue, west of South River Street and east of South Lincoln Street.
A TIF district is a sort of economic development tool that essentially freezes the amount of property tax revenue each taxing body receives from an area at the point at which the TIF is instituted. The extra or “increment” taxes created by the development of the property go into a special fund used to pay for costs related to improving the area.
The city had initially planned to hold a public hearing about the proposed new TIF district on April 6, which has since been canceled. The measure approved March 16 terminates further actions in relation to the proposed TIF district until the mayor and City Council take action on it.
Going forward, the city is looking to schedule a public hearing for October or November, according to Batavia City Administrator Laura Newman, with the goal of the council voting on the ordinances needed to establish the TIF district in December or January.
At the council’s Committee of the Whole meeting on March 10, city Economic Development Manager Anthony Isom explained that the pause is meant to give the city additional time to review the proposed TIF district, emphasizing that the TIF district hasn’t been established yet.
“We’re just trying to make sure that we’re bringing a solid financial plan to the city as we embark on this very large and important project for our downtown,” Newman said at the meeting.
Included in what may one day be the new TIF district are at least two major development projects already being considered for the area.
One is the new QT9 headquarters, which has plans to move from Aurora to downtown Batavia. The software company is planning to set up shop at 190 S. Water St., a former factory site.
In February, the Batavia City Council promised almost $1.9 million in TIF funds to help with renovation costs for the new QT9 headquarters. The planned space currently sits within the city’s TIF District 3, which is set to expire in 2039, but would be removed from that district and placed into TIF District 7 should the latter be created.
BEI Commercial Real Estate, which currently owns the property and which is part of the joint venture redeveloping the building, did not immediately return a request for comment about the pause on the TIF proceedings.
The city is also looking to work with a developer on a project within the proposed TIF area: a mixed-use development including market-rate apartments, commercial space and a public parking garage, according to Newman.
The city recently purchased two properties at 102 and 108-116 S. Batavia Ave., Newman said in an email to The Beacon-News. BEI owns the remaining property on that block, which is bounded by South Batavia Avenue, Main Street, South Water Street and First Street, she explained. Newman said the city’s plans are to collaborate on the project, with the city maintaining ownership of the future parking garage and a private entity owning the apartments and commercial space.
At the March 10 Committee of the Whole meeting, Ald. Christopher Solfa said he “completely agree(s) with pausing” the TIF proceedings.
“We’re not the bank of Batavia to fund these things,” Solfa said.
Ald. Matthew Anderson said he understands the reason for a pause on the TIF proceedings, but that he wanted to “put a little more pressure on” the planned timeline, citing the potential of construction costs increasing.
And Ald. Leah Leman pointed out that, while the city is not “the bank of Batavia,” it is “heavily invested in this project,” and would benefit by the addition of public parking.
And, as the city continues to evaluate the area’s future development, Ald. Tim Lanci, too, reiterated the importance of the proposed project for the area.
“We know this is a big deal,” Lanci said. “I think this could be a catalyst to a lot of things in this town.”
mmorrow@chicagotribune.com
