- Economic Development
- Palatine's Tax Increment Financing (TIF) Districts
Palatine's Tax Increment Financing (TIF) Districts
The Village of Palatine has had a total of five Tax Increment Financing (TIF) Districts which were created to promote reinvestment and redevelopment within the Village. The existing (active) TIF districts, outlined below, are located within downtown Palatine and along the Lake Cook, Rand, and Dundee corridors.
Downtown Area TIF District
This TIF District (see map) was established in December 1999. In the over 20 years since the TIF District was established, downtown Palatine has experienced a tremendous amount and variety of redevelopment. This redevelopment has resulted in the addition of approximately 975 residential units, 93,000 square feet of commercial/restaurant space, and 120,000 square feet of professional office space.
Lake Cook and Rand/Dundee Corridors
A total of two TIF Districts (see TIF district map (PDF)) currently exist within the Lake Cook and Rand/Dundee corridors in Palatine. The Dundee Road TIF District (which contained two separate TIF Districts), generally located on the south side of Dundee Road, between Hicks Road and Rand Road, was terminated upon its expiration. These TIF Districts were established to ensure these critical commercial corridors continue to generate significant sales tax revenues for the Village, thus reducing the Village’s dependency on property taxes. A variety of projects within these districts have resulted in the development of major commercial uses (such as Wal-Mart, Target, Arlington Toyota, and City Limits Harley-Davidson) as well as a variety of smaller retail/restaurant uses (such as Culvers, Panda Express, and Tore and Luke’s).
Upon the establishment of a TIF district, the current value of each property within the TIF district is used to define each property’s base amount. The property taxes paid on this base amount continue to go to the various taxing bodies as they had before the creation of the TIF District. However, any growth (or increment) in the value of the property over the base is captured by the TIF district. This increment is collected into a specific fund for use by the municipality to make additional investments in the TIF district. This reinvestment generates additional growth in property value, which results in even more revenue growth for reinvestment. At the conclusion of the TIF district, which is a maximum of 23 years based on Illinois law, all of the local taxing bodies then benefit from the reinvestment and redevelopment that resulted within the TIF district.
Use of TIF Funds
The Illinois TIF Act generally allows the use of TIF funds for the following:
The rehabilitation or renovation of existing public or private buildings;
Financing costs, including interest assistance;
Studies, surveys, and plans;
Marketing sites within the TIF District;
Professional services (such as architectural, engineering, legal, and financial planning); and
Demolition and site preparation.
Please note that some restrictions may apply, so refer to the full State of Illinois TIF act for specific information related to TIF eligible expenses.