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DeKalb council considers economic incentives for South Fourth Street corridor

Published: Tuesday, June 25, 2013 11:00 a.m. CST • Updated: Wednesday, June 26, 2013 9:41 a.m. CST
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(Rob Winner – rwinner@shawmedia.com)
(From left to right) Patty and Steve Tallitsch, both of DeKalb, are served Wednesday by Scott Morrow, owner of Flippin Eggs, at the restaurant on South Fourth Street in DeKalb. DeKalb City Council is considering establishing a tax increment financing district along South Fourth Street to spur economic development in the area.
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(Rob Winner – rwinner@shawmedia.com)
Mike Ritz, owner of Ritz's Southtown Auto, tests a solenoid on a vehicle Wednesday in his shop on South Fourth Street in DeKalb. The city of DeKalb is considering establishing a tax increment financing district along South Fourth Street to spur economic development in the area. Ritz may seek TIF money to improve the cosmetics of his building and a new sign.
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Rob Winner – rwinner@shawmedia.com Protano Auto Parts on South Fourth Street in DeKalb, Ill. is seen on Wednesday, June 19, 2013.
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Rob Winner – rwinner@shawmedia.com DeKalb resident Sarah Stoffa jogs regularly north on South Fourth Street near East Sunset Place in DeKalb, Ill., Wednesday, June 19, 2013. The city of DeKalb is considering establishing a tax increment financing district along South Fourth Street to spur economic development in the area.
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Rob Winner – rwinner@shawmedia.com Jonnetta Lyons (left) and Kawaune Williams, both of DeKalb, play a game of checkers while at Flippin Eggs located on South Fourth Street in DeKalb, Ill., Wednesday, June 19, 2013. The city of DeKalb is considering establishing a tax increment financing district along South Fourth Street to spur economic development in the area.

DeKALB – Business owners and some residents are excited about the redevelopment possibilities that a tax increment financing district could bring to the South Fourth Street area.

By far, the old Protano's Auto Parts site was named as being the biggest eyesore in the the area. Scott Morrow, owner of Flippin' Eggs restaurant at 831 S. Fourth St., noted that "it's been empty for so long."

The city is considering establishing a new special financing district along a narrow stretch of South Fourth Street between Taylor Street and Fairlane Avenue, as well two parcels along Sycamore Road.

The district would sit in the 4th Ward, represented by Alderman Bob Snow, and the 5th Ward, represented by Alderman Ron Naylor.

TIF districts raise money for redevelopment by freezing the amount of property tax that local governments receive from landowners in a given area. As property values and property tax payments increase in the area, the money above the baseline is diverted to a special account that can be used to fund improvements.

The city already has two districts, including one that encompasses major portions of Sycamore Road and downtown DeKalb, and another between Lincoln Highway and Taylor Street. An area must be declared "blighted" in order to be eligible for a district.

City officials are scheduled to meet Friday with representatives from other local taxing bodies to discuss the new districts. The City Council will hold a public hearing for the South Fourth Street district Aug. 12.

Focusing on Protano's

The Protano's site at 1151 S. Fourth St., is one property that faces an obstacle to redevelopment, leaders said. The property has potential for commercial redevelopment, but might have contaminated soil.

In the early 2000s, city officials began working with the Environmental Protection Agency to clean up the site. T.J. Moore, the city's public works director, said city officials had just finished examining the history of the site environment when work stopped.

"There was little activity while the [Protano] estate figured out the direction they wanted to go with this property," Moore said. He added that the city is working with the Protano estate to clean up the property.

DeKalb Principal Planner Derek Hiland said the city is working with a firm to assess the potential contamination. Because Protano's was an auto junkyard, Hiland said they are expecting to find petroleum waste, chemical waste and lead.

"Each of those contaminants specifically take different treatment methods to remediate the site," Hiland said.

Both Hiland and Moore said preliminary tests are showing that the site might not have much contamination, but they are waiting on the results.

City officials would not speculate on the cost to renovate and clean up Protano's, because it would depend on the contamination. At this point, both Hiland and Moore said they have seen no evidence to suggest that contaminants in the soil have spread.

"In any industrial site, anywhere, you're always going to have that. It's plausible lots of different things have happened," Moore said. "We test our water multiple times a day, to try to ensure that doesn't happen. What is more likely is that the contaminants are sitting there in the local soil and have become a detriment to redevelopment."

Moore and Jennifer Diedrich, DeKalb's economic development coordinator, said if the South Fourth Street area became a TIF district, a developer could request financial help from the city to help redevelop the site.

Business' wish list

Protano's isn't the only vacant property that would fall into the potential South Fourth Street TIF district. Diedrich said 32 percent of the commercial space available in the district is vacant, most of it being the old Sullivan's grocery store.

"If you have an anchor down here, people will come down here," said Morrow.

Morrow described the businesses along South Fourth Street as being destination-only spots, meaning the people who come to the area are coming only to visit one shop.

"We want more and more stuff around here, so people aren't just coming for State Farm, or just coming to get their car fixed," Morrow said.

If a district is established, Morrow said he would apply for funds to remodel the interior at Flippin' Eggs and repair the parking lot, projects he would be unable to afford otherwise, he said.

Mike Ritz, owner of Ritz's Southtown Auto, 1036 S. Fourth St., said he would hope to use the tax dollars to buy a sign, as well as do some cosmetic improvements to his shop.

"Some of that stuff you just can't do yourself," Ritz said. "You have to pay somebody to come and do it, and you can't afford it."

Since opening in 2001, Ritz said he has seen many restaurants – including KFC – come and go.

"They're having a hard time drawing people to this side of town," Ritz said.

Residents' perspective

But residents, like Bonnie Hjelmberg and Steven Swantek, are if the opinion the additional tax dollars should be poured into improving the area streets. TIF proceeds can be used to improve public infrastructure as well.

"I think they ought to clean it up, spend some money on the streets," Hjelmberg said. "If you go further south, it's even worse."

Swantek said he sometimes rides his motorcycle to work at the DeKalb Oasis along Interstate 88. The potholes can be rough, he said.

However, Kay Coover, an employee at Pine Acres, said she thinks spending the tax dollars on businesses and economic development would be useless.

"I just don't think it's on this side of town," Coover said. "I think this is more of a residential – maybe parks or something in this area would be nice. But businesswise, it's never worked down here."

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