City hopes to work with May Mart on redevelopment, TIF incentives in the future
TIF districts have been beneficial to recent developments in Rochelle
ROCHELLE — The City of Rochelle hopes to work with ownership of May Mart/Rochelle Commons to begin a redevelopment project that includes tax increment financing (TIF) incentives in the future, City Manager Jeff Fiegenschuh and Community Development Director Michelle Pease said Jan. 18.
The longtime shopping and restaurant center on the Illinois Route 38 stretch is eligible for the city’s Northern Gateway TIF district.
TIF is a geographically-targeted economic development tool that captures the increase in property taxes, and sometimes other taxes, resulting from new development, and diverts that revenue to subsidize a development. TIF money has been used to bridge gaps in financing by the city and developers of projects in Rochelle such as Kennay Farms Distilling, Seldal Properties and Walmart.
“Specifically with the old May Mart, or the Rochelle Commons now, a lot of those spaces are beginning to fill up,” Pease said. “We have constant contact with property maintenance in the area of May Mart with those shops. We've shared our TIF information and an application with them to kind of push along that process so that they can keep shining up that spot in our community."
Fiegenschuh and Pease said they have hopes for a future project for the area with the ownership if talks come to fruition one day.
“To do a good development project, you have to have a willing and able participant,” Fiegenschuh said. “And I’m not saying they’re not willing. That's just the most important piece of that puzzle, having private sector dollars to move forward. We hope to have that in the future with the May Mart area.”
Pease called the recent improvements to downtown businesses “a wonderful example” of how TIF districts are supposed to work. TIF money was used in a redevelopment agreement with Seldal Properties for the building at 318, 320, 322, 324 and 326 Lincoln Highway for mixed-use retail and residential space. The tool was also used in an agreement for the former Hub Theater when Kennay Farms Distilling remodeled it, along with The Rick House building the business owns behind it.
TIF was also used with the demolition of dilapidated houses on 2nd Avenue, and the demolition of the Hickory Grove building. The new light poles currently being put up on Illinois Route 38 are part of a TIF-funded project as well.
“I'm proud of us, because we use TIF the way it's supposed to be used, which is to increase values,” Fiegenschuh said. “We've had developers say that their project would not be happening if not for TIF involvement. The point of it is not to subsidize, it's to close a funding gap. If developer A wants to build something, but there's a funding gap and they can't quite meet where they need to be for their investment, TIF can help bridge that. We're just rebating their money that they paid in. It's an important tool and a lot of projects that have happened here in town wouldn't be happening without the TIF.”
The city’s Lighthouse Pointe TIF, which involves the Walmart area near Illinois Route 38, was integral to that corridor’s growth, Pease said. If not for TIF, she believes the downtown area could “still be struggling” as it was years ago.
Fiegenschuh said all city corridors are equally important and said he’s enjoyed seeing developments and new businesses in each of them in recent years. He called the May Mart area “a critical corridor.”
“One of Michelle's strongest attributes is being able to work positively with people and be able to bring them along and be a very positive person and ask them to think about things and the ways we can help,” Fiegenschuh said. “And I do think we'll see some projects over there in the future where we can partner with them. I would love to see a project at May Mart move forward.”
The coming years of the city’s northern gateway corridor will also involve the reconstruction of Illinois Route 251 by the state and the potential redevelopment of the Hickory Grove site.
“I think there's a point in time when there's a comfort level for the property owner and discussions and moving forward,” Pease said. “I think that things will start to happen there in that corridor and especially with the Hickory Grove property. I anticipate some things in the next 2-3 years.”