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The 54% Shift

(30 posts)
  • Started 5 years ago by ChrisHajer
  • Latest reply from spatny
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  1. ChrisHajer
    Member

    At workshop three, Joe Pilewski of the EDC presented a Powerpoint presentation and in it was a slide that held some very interesting information. I call it the 54% slide, and I know MikeT and Tim have both referred to that 54% figure too.

    http://www.riversideinfo.org/forum/topic.php?id=189

    I was hoping Joe was going to go over it again, because it took a while to sink in. He called that information that was shown "the most pessimistic" outcome. Can someone from the EDC or someone familiar with the slide explain in detail exactly what the slide was trying to convey? I know Joe cannot post here due to Open Meetings restrictions, but maybe MikeS or corbi can comment. Can anyone get the slide and we can post it here somehow? It contained a lot of information I don't think I've seen mentioned anywhere else.

    Thank you.

    Posted Friday Feb 23, 2007 10:32 #

  2. MikeSedivy
    Member

    I could not make it last night. I assume Tim addressed the question last night with Joe in a forum in which he could respond?

    Posted Friday Feb 23, 2007 10:53 #

  3. spatny
    Member

    I'm sure that Mr. Pilewski could post whatever he presented last night here without being afoul of the law. This is not the Peace Court at the Hague.

    Posted Friday Feb 23, 2007 10:55 #

  4. ChrisHajer
    Member

    Tim did not ask about that slide last night. We ran a little long and ran out of time for questions.

    Posted Friday Feb 23, 2007 10:56 #

  5. corbi328
    Member

    Chris,

    I'll take a shot at it but just to clear up the record, Joe did go over that slide again last night. What that slide attempts to show is the percentage contribution to the TIF by Riverside related taxing bodies (Village, District 96, District 208) vs. the percentage contribution from "outside" taxing bodies (Cook county, water reclaimation distrcit, triton college, mosquito abatement etc...). Per Joe's rough calculations, the percentage contribution from Riverside related entities is 54%, while the percentage contribution from the "outside" bodies is 46%. Put another way, for every dollar raised in the TIF, 54 cents is contributed from Riverside related taxing bodies while 46 cents is contributed by "outside" taxing bodies whose service to Riverside does not change materially because of the TIF. When you consider the above, the title of this thread should really be the "46% Shift" because what this anlaysis is essentially showing is that investments we make to improve Riverside through a TIF will be 46% financed by "outside" taxing bodies. This is what makes a TIF so powerful. Any other methodology (except historical tax credits) that is used to finance a reinvigoration of downtown, requires that 100% of the dollars come from Riverside's piggy bank. The TIF in my mind is no different than a 401K plan where an employer puts 46 cents in an employee's retirement account for every 54 cents that the employee contributes. Who would be stupid enough to pass that up.

    Posted Friday Feb 23, 2007 11:59 #

  6. Elisa
    Member

    Someone with a mathematical mind help me out here, please. I get all mixed up with the percentages of this and that - so I want to focus on one building (allow me the "what if there was a TIF in place" assumption) - the Arcade because I can find real numbers and it's in the CBD. Right now, according to the county assessor's office, it's assessed value is $326,799. To roughly extrapolate the actual amount, I compared it to my tax bill (based on my assessed value) and figured out that they are paying about $65,000 to the Village in taxes. If 54% goes to the schools, that is $35,000. This $35,000 going to the schools would be frozen under a TIF, right? (If a TIF went through and if the Arcade was in the district. I'm only using that building as an example because I could find the actual numbers.)

    Posted Friday Feb 23, 2007 13:26 #

  7. corbi328
    Member

    Elisa,

    I don't think your numbers are right because commericial and mixed use property is assesed at 36%-38% vs. 16% for residential. The Arcade building's taxes are much higher than $65,000. Furthermore, 54% of that number would go to the Village, District 96 and District 208.

    For the sake of the example, let's assume your numbers are right. Under your scenario, the $35,000 in annual taxes would continue to go to the Village and schools. The amount that would be captured by the TIF is in the increment created from appreciation that occurs after the TIF is put in place.

    Posted Friday Feb 23, 2007 13:49 #

  8. Elisa
    Member

    OK, that's why I'm going to ask questions slowly - so that I can see my flaws in logic before going on. Thanks.

    Next, let's say that condos are eventually developed there. And not even the nine - but scaled back to 5. Will their property taxes (which aren't in existence now b/c there are no condos now) all be part of the TIF money? And so I can figure more correctly, are condos taxed at the residential rate?

    Posted Friday Feb 23, 2007 13:56 #

  9. corbi328
    Member

    Good question. I know where you are going with this and I am not completely sure I know how to answer the next question you will ask. Let me do a little digging and I'll follow up.

    Posted Friday Feb 23, 2007 14:10 #

  10. spatny
    Member

    Moot point. They dropped the condo project. Only $200K in TIF funds related to new condos, $1.4 to old Arcade Rehab. Money talks.

    Posted Friday Feb 23, 2007 14:14 #

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