HomeMy WebLinkAboutMinutes - 12/10/2001 - Committee of the Whole (2) COMMITTEE OF THE WHOLE MEETING
DECEMBER 10, 2001
A Committee of the Whole Meeting of the McHenry City Council was called to order
by Mayor Althoff at 7:00 P.M. on Monday, December 10, 2001 in the Council Chambers of
the Municipal Center. At roll call the following Aldermen were present: Bolger, Low,
Murgatroyd, Wimmer. Alderman Glab arrived at 7:25 p.m. Absent: None. City Staff in
attendance were: City Administrator Lobaito, Assistant City Administrator Maxeiner and
City Clerk Jones. Director of Community Development Napolitano arrived at 7:28 p.m.
Absent: Director of Public Works Batt, Director of Parks and Recreation Merkel and City
Attorney McArdle.
PRESENTATION
Mayor Althoff introduced Gary Mang of the Union Pacific Railroad, Chairman of "For
the Children" fundraiser. Mr. Mang informed Council the Hand Car Race is a national
event sponsored each year by the Union Pacific Railroad employees to raise funds for
children's hospitals. Mr. Mang stated the Council, in particular Alderman Murgatroyd, was
instrumental in the success of the 2001 Hand Car Race held at Petersen Park on August
19, 2001.
Mr. Mang thanked the City of McHenry for its support and presented the City with a
plaque.
PRESENTATION — ESTABLISHMENT OF A TAX INCREMENT FINANCING DISTRICT
Mayor Althoff acknowledged the presence of representatives from the McHenry
Economic Development Commission, the Riverwalk Committee and students from the East
Campus Government Studies Class, noting the students have chosen the Riverwalk
Project as a class project.
Mayor Althoff announced the presentation of a timeline and discussion of the Tax
Increment Finance (TIF) District by TIF attorney, Kathleen Field Orr of Kathleen Field Orr
&Associates, legal counsel for the City of McHenry.
F. Clifford DiLorenzo, John C. Pettigrew and Lisa M. Lyon, of Trkla, Pettigrew, Allen
& Payne, Inc., Project Planners for the Riverwalk, presented an overall Preliminary Project
Schedule together with a report entitled Conceptual Budget No. 1. The Conceptual Budget
breaks down the hard costs, soft costs and future operating costs.
Ms. Orr summarized how TIF functions, explaining tax increment financing as a
method by which the taxes derived from the incremental value in real estate are available
for future planning. She stated a number of requirements must be satisfied for an area to
qualify as a TIF district, beginning with identification of the district and the physical and
economic deficiencies that need to be addressed. Municipal officials and a board of
representatives from local taxing bodies then review a plan for redevelopment of the TIF
area and a Public Hearing is held for residents and other interested parties to express their
L, views.
Responding to Alderman Bolger's inquiry concerning the percentage of the
increment for use in the Riverwalk Project, Ms. Orr stated the Council makes discretionary
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determination regarding the use of funds derived from the TIF district.
Ms. Orr outlined a proposed Schedule for Adopting Tax Increment Redevelopment
Plan and Project for the City of McHenry. She advised Council Illinois TIF law allows a TIF
district to exist for a maximum of twenty-three years. Any TIF district may be terminated
earlier if all financial obligations are paid off and the Council votes to terminate the district.
If no redevelopment project has been initiated within a TIF district within seven years
following district designation the municipality must then repeal the TIF.
John Pettigrew, a principal of Trkla, Pettigrew, Allen & Payne, reviewed the history
of tax increment financing highlighting the differences between block grants and tax
increment financing. He advised Council Trkla, Pettigrew, Allen & Payne has conducted
surveys and analyses, looking at every parcel and each building within the designated
area. Mr. Pettigrew advised statute requires, in order to qualify, a redevelopment project
area must be either:
• A blighted area; or
• A conservation area; or
• An industrial park conservation area
Mr. Pettigrew informed Council the results of Trkla, Pettigrew, Allen & Payne's
findings indicate while the degree and distribution of eligibility factors vary across blocks
throughout the entire 20 blocks of the Project Area, the downtown area qualifies for
designation as a conservation area as defined by State law. The key threshold for
designation as a conservation area is 50%, or more, of the buildings must be 35 years of
age or older. In the study area there are 167 buildings, 142 or 85% of the buildings are 35
years of age or older, well above the minimum threshold for a conservation area. Mr.
Pettigrew advised the statute also lists thirteen factors. If three, or more, of the thirteen
factors are present and reasonably distributed throughout the conservation area, in
addition to the age requirement being met, the area qualifies as a conservation area.
Studies performed by Trkla, Pettigrew, Allen & Payne indicate of the thirteen factors
required, five are present to a major extent:
1. Obsolescence;
2. Deterioration;
3. Deleterious land use or layout;
4. Declining or lagging equalized assessed value; and
5. Lack of community planning.
In addition, four other conservation factors are present, although to a lesser degree,
throughout the study area:
1. Structures below minimum code;
2. Excessive vacancies;
3. Excessive land coverage/overcrowding; and
4. Dilapidation. -IN
Alderman Glab arrived at 7:25 p.m.
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Lisa Lyon, senior associate at Trkla, Pettigrew, Allen & Payne, stated one of the key
components to qualifying a TIF area is looking at the equalized assessed valuation of the
property, at the beginning of the project, in order to establish a baseline for a trend
analysis.
Director of Community Development Napolitano arrived at 7:28 p.m.
Alderman Bolger voiced his disappointment the property east of the Fox River has
not been included in the TIF District. Alderman Glab suggested expansion west, rather
than east of the Fox River, due to the corridor along Route 120 out to Ringwood Road.
Mayor Althoff opened the floor to public questions and comment.
Mr. Richard Hignight, a McHenry resident, expressed strong objection to the
establishment of a TIF District and the Riverwalk Project.
City Administrator Lobaito inquired if the precise boundaries of the TIF area have
been established. Ms. Orr advised the boundaries have been established. It is her hope
all parties will be in agreement and a draft TIF Redevelopment Plan indicating the
established boundaries can be provided to Council prior to the Public Hearing scheduled
to take place on January 21, 2002.
Mayor Althoff requested City Administrator Lobaito summarize certain issues
regarding decisions which must be made in the near future. City Administrator Lobaito
suggested Council consider the proposed boundaries and determine their acceptability.
Additionally, City Administrator Lobaito suggested the City:
• Obtain a Phase I Environmental Study;
• Conduct Surveys and prepare necessary legal work for development of easement
and right of way documents required for Riverwalk construction;
• Hire a Project Coordinator.
Mayor Althoff reported there is still $1.2 million in grant monies available, which may
be utilized on some of these expenditures so the funds are not forfeited.
It was the consensus of Council to proceed with the Schedule for Adopting Tax
Increment Redevelopment Plan and Project for the City of McHenry, Illinois, as outlined by
Kathleen Orr, with any concerns to be addressed, under New Business, at the Regular
Council Meeting scheduled for December 17, 2001.
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ADJOURNMENT
Motion by Low, seconded by Glab, to adjourn the meeting at 8:55 P.M.
Voting Aye: Bolger, Glab, Low, Murgatroyd, Wimmer.
Voting Nay: None
Absent: None
Motion carried.
The meeting was adjourned at 8:55 p.m.
Mayor \City Cle I
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