DeKALB – After a tumultuous end to 2018, DeKalb’s Joint Review Board is finding its footing in the new year, with the announcement that $5.6 million will be distributed to taxing bodies after the close of the tax increment financing district known as TIF 2.
The Joint Review Board reconvened Friday at the DeKalb Municipal Building, 200 S. Fourth St., for the first time in months (after going “sort of sideways” as City Manager Bill Nicklas put it) following the initiation of a forensic audit to clear up concerns about the city’s past use of surplus tax increment funds.
Nicklas said the surplus will be distributed within a week, and said more could be distributed if three proposed projects for which the city earmarked funds in December do not come to fruition. Plans for a boutique hotel at 145 Fisk Ave. in DeKalb seemed less certain than other projects the City Council had agreed to fund late last year.
“I would say the [Egyptian Theatre] project is very likely, and [Hometown Sports Bar & Grill] is very likely,” Nicklas said. “It’s still to be seen what will happen with the conceptual consideration of 145 Fisk Ave., that’s something that’s going to the [Planning and Zoning Commission] at the first meeting in February.”
Tax increment financing districts, once created, can generate money for redevelopment for a period of up to 23 years by freezing the property values that taxing bodies can collect property taxes on. As property values increase over time, the property tax revenue on that increased value – the increment – is diverted to a separate account to be used on improvements. Most of the commercial property in DeKalb has been in a TIF district for decades; during that time, it has generated millions of dollars in increment that otherwise would have gone to for local schools, parks, county government and other services.
DeKalb School District 428 Superintendent Jamie Craven was voted the new board chairman, and Tim Hayes, owner of Barb City Bagels, was re-elected to the public member spot. Nicklas, who has taken Mayor Jerry Smith’s spot on the board, said he felt the chair position should be filled by someone outside city government.
“The whole purpose of reconvening and reorganizing was to do just what some citizens have been asking for, and to bring more transparency to this whole process,” Craven said after the meeting. “And also to demonstrate to our community that the taxing bodies are working together. We have some things to work through, obviously, but this is a good group and we’ll get it done.”
The board will also restart discussions of an intergovernmental agreement relating to the probable creation of a third tax increment financing district, which lost momentum in November after questions arose about spending.
Nicklas gave an update on possible “TIF 3” discussions when DeKalb Park District Executive Director Amy Doll inquired whether the city had any urgency in restarting the conversations.
“I didn’t think it was a matter of extreme urgency until about a week ago,” Nicklas said, who led most of the conversation throughout the hour-long meeting. “I was informed that the county and township assessors are going through a process of looking at assessed valuations, and there may be new assessments, and some of those may touch on TIF parcels in TIF 3. I think there are good and sufficient reasons to consider, under new framework and more accountability, the prospect of TIF 3.”
As DeKalb County Administrator Gary Hanson pointed out, the board had 30 days after meeting multiple times in fall 2018 to make a positive or negative recommendation to the City Council regarding TIF 3. Because the board didn’t, a positive recommendation is automatically assumed.
“Failure of the board to submit its report on a timely basis shall not be cause to delay a public hearing, but shall be deemed an approval in the event of creating a new TIF,” City Attorney Dean Frieders said after the meeting, reading from section five of the TIF Act.
DeKalb County State’s Attorney Rick Amato gave an update on the forensic audit, which will be conducted by an outside auditor chosen by the state’s attorney’s office. Amato said the request for bids will go out by the end of the month, and responses will be collected by the end of February. Amato could not say how long the audit would take.
The board will meet again at 2 p.m. Feb. 1.