Village poised to create new tax incremental district

The Village of Fredonia is slated to consider a proposal for a new tax increment financing district that if approved will generate revenue used to greatly expand its industrial park. 

The proposed 91-acre district would include Guy and O’Neill, Inc., 200 Industrial Dr., where a new building will be constructed this year; five undeveloped parcels in the Fredonia Industrial Park; and 62 acres east of the park that will be purchased by the village. 

The district would allocate millions of dollars in property taxes to purchase 62 acres of undeveloped property the village would prepare for future industrial development.

At least half of the property in the district  would be zoned for industrial development.

To purchase the land, install public improvements and fund other expenses associated with promoting industrial development in the district, the village anticipates spending $8.62 million, which would be funded using revenues from the new TIF district. 

In a report from Ehlers, Inc., the village’s TIF consultant, the projects would be paid off within 16 years.

Of the expenses associated with the project, $1.09 million would be used for land acquisition, $4.6 million for public infrastructure and related engineering, $2.87 million for interest on long-term debt and financing related expenses and $60,000 for district administration and miscellaneous expenses. 

The village anticipates the project would add approximately $51.48 million in value to its property tax rolls.  

The Fredonia Plan Commission unanimously recommended the Village Board approve the district boundaries and project plan during its June 7 meeting. The board will consider the recommendation during its June 17 meeting. 

Ehlers Senior Municipal Adviser Todd Taves told the commission that increased tax revenue in the district will fund the projects. 

“Regardless of whether your property is in a TIF, you pay the same tax bill. It’s just a question of where the taxes go,” he said.

Even if industrial development on the newly acquired land does not occur as quickly as the village hopes, the added property value from the new Guy and O’Neill building would supply the TIF with enough revenue for the village to pay off expenses related to acquiring the land within 20 years.

The village has had two TIF districts in the past, but those are currently closed, making the third the only one to operate if approved by the board. 

“If nothing else happens, we would still have $139,000 in taxes coming in each year for 20 years,” Taves said.