Tax Increment Financing (TIF)

On February 11, 2019, the City Council approved Ordinance 2018-70 Adopting Tax Increment Financing for the DeKalb Central Business District TIF (TIF #3).  The primary purpose was to promote continuing commercial and residential rehabilitation and redevelopment in the central business district. In recent years, TIF #1 has supported several significant redevelopment projects in the central business district. With TIF #1 ending on December 31, 2021, the City established TIF #3 to continue the momentum of redevelopment. A number of properties that previously existed within TIF #1, including several currently undergoing redevelopment, now lie within the boundaries of TIF #3. 

The TIF Act does allow for municipalities to “port” funding between TIF districts, so long as they are contiguous to each other and the use of transferred funds has a benefit to the TIF district from which funds are ported. The FY2022 Budget includes the transfer of funds from TIF #1 to TIF #3 in the amount of $2.19 million. These funds will support ongoing redevelopment projects that were within TIF #1 when approved but are now within the boundaries of TIF #3, as well as other anticipated projects which are allowable under the TIF Act. 

After January 1, 2022 only TIF #3 will provide funding for private rehab projects based on incremental property tax revenues as defined by Illinois TIF statutes. TIF #3 is very substantially smaller in area and revenue than TIF #1 at its height. At one time TIF #1 generated over $7 million a year in incremental revenue; TIF #3 is expected to generate about $460,000 in FY2022. TIF #1 once comprised about 19% of DeKalb’s corporate limits; TIF #3 is basically the downtown central core following IL Rt. 38 from the NIU lagoon eastward to about Dodge Avenue and extending north and south of Lincoln Highway by about two blocks in either direction. The following projects will be funded in FY2022:

Architectural Improvement Program (AIP) — This program principally encourages owners of commercial property to maintain the appearance of their downtown properties. Approved projects are considered on a case-by-case basis and may be provided up to $25,000 in matching funding according to a three-tier system: a 50% reimbursement rate is assigned to eligible major capital improvements; a 25% reimbursement rate is assigned to eligible minor capital improvements; and a 10% reimbursement rate is assigned to defray the costs of deferred maintenance. All funding is subject to final approval by the DeKalb City Council.

In FY2021, the AIP “loans” were as follows:

Egyptian Theater$4,314
Hillside Restaurant$18,076
115 N. 1st St.$1,675
Hickeys Corner Store$1,185
201-203 E. Locust St.$1,850
151 N. 4th St.$25,000

In FY2022, the AIP has a budget of $70,000.

Downtown IL Rt 38 Reconfiguration ($1,250,000) — This TIF #3 project is still awaiting final IDOT approval, which should be received in the winter of 2021-2022. The reconfiguration will reduce the four-lane downtown section of IL Rt. 38 between First and Fourth Streets to three lanes (with a center turn lane). This will widen the downtown sidewalks by about 5-6 feet on both the north and south sides, allowing for a more pedestrian-friendly streetscape and mitigating the truck “raceway” through the heart of DeKalb’s downtown. The wider sidewalks will afford more room for sidewalk sales, outdoor seating, and more leisurely enjoyment of the downtown businesses. To date, the City has received conceptual approval, has addressed the IDOT requirement for a parallel bike path by committing to such a pathway on Grove Street, and has addressed various IDOT technical suggestions for turn radii, etc. The only remaining obstacle is a decision by IDOT concerning whether or not the City has to make further design modifications at the Fourth Street rail crossing.

Private Property Rehabilitation — Two larger private rehab projects will receive their last TIF funding in 2022: Agora Tower and the former City Hall (Johann DeKalb Suites). The final funding has accrued in the Fund 262 reserve and has been built by the porting of funds from TIF #1, according to state statutory guidance. Once these two projects have been fully funded in 2022, the TIF #3 annual outlay for private rehab projects—minus the TIF #3 tax sharing with local taxing bodies—will be approximately $250,000 (including the annual AIP allocation of $70,000). 

Agora Tower. The Project’s developer, John Pappas, intends to get the four-story building under roof late this fall. The project completion is likely to be in the fall of 2022. Thus far, $1,982,583 of the $3,000,000 TIF #3 allocation (approved in September 2019) has been disbursed. 

Johann DeKalb Suites. This one-block area in TIF #3 (formerly City Hall) has been off the tax rolls since the late 1960s. The former city hall has been razed and the excavator has crushed the masonry debris for recycling. At the time FY 2002 City budget was approved, $502,846 of the $750,000 grant has been allocated.

The City's TIF Map can be viewed here.

The TIF District Redevelopment Plans and Annual Reports can be viewed here.

To learn more about Tax Increment Financing, visit the City of DeKalb TIF FAQs page or Illinois Tax Increment Association’s web page.

TIF Interested Parties Registry
If you are interested in receiving public notices related to the City of DeKalb's TIF districts, please consider registering as an interested party. To apply for the registry, please review the Registry Registration Rules and submit an application via mail or in person at City Hall. The most recent version of the Registry can also be found below. 

TIF Interested Parties Registry Registration Rules
Application for Individuals
Application for Organizations
City of DeKalb Interested Parties Registry