At its Oct. 28 meeting, the Rochelle City Council unanimously approved the creation of a new Eastern Gateway TIF (tax increment financing) district, which includes the Caron Ridge Shopping Center (the former site of Sullivan's Foods), and farmland east of the center to Dement Road. The Eastern Gateway TIF consists of approximately 82 acres and 10 parcels.
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ROCHELLE — At its Oct. 28 meeting, the Rochelle City Council unanimously approved the creation of a new Eastern Gateway TIF (tax increment financing) district, which includes the Caron Ridge Shopping Center (the former site of Sullivan's Foods), and farmland east of the center to Dement Road. The Eastern Gateway TIF consists of approximately 82 acres and 10 parcels.
In creating the Eastern Gateway TIF, the city hopes to encourage development at the Caron Ridge Shopping Center and address property blight, vacancy, aging infrastructure and assist with overall redevelopment of the district.
“It was good to get it approved,” City Community Development Director Michelle Pease said. “It is official now. We have a meeting set up already with a developer for the vacant land in that corridor coming in. Then we'll sit down with the new owners of the Sullivan's Foods building. They wanted to reach out to us after that was approved so they know what they can do and what's next for them. We've got projects and potential waiting in the wings.”
The developer the city will meet with regarding the vacant farmland is in the hotel industry. Pease said she believes that area, which runs along Illinois Route 38 from Caron Road to Dement Road, would lend itself well to hotel development, which would increase the city’s hotel/motel tax revenue.
The developer would have to purchase that land from its current owner. Municipalities can establish a TIF without the consent of the property owner, but it’s up to the owner whether or not they want to sell to a developer.
TIF funding cannot be used to construct new buildings, but infrastructure improvements like water, electric or roads are TIF-eligible expenses.
For the Caron Ridge Shopping Center and vacant former location of Sullivan’s Foods, Pease said the city has had ongoing conversations with the new owners that recently took over on what they’d like to do and see there. TIF funding can be used to redevelop existing buildings.
“There's some potential for some big box stores sharing the space or one taking over the space,” Pease said. “It's about 40,000 square feet, so for them to find a big box willing to take that much square footage is a little bit difficult. There could be an opportunity to be able to split that in two seems more realistic.”
City Manager Jeff Fiegenschuh said the Caron Ridge Shopping Center is an ideal candidate for a TIF district and redevelopment project. The former Sullivan’s Foods space in it has been vacant since 2018. TIF funds generated by the area’s increase in value can be used for its redevelopment.
Fiegenschuh said a potential development of the farmland in the new TIF district would create a huge jump in the area’s value to generate TIF funds for projects.
“The great thing about the vacant farm ground is you're going from farm ground assessment to a commercial tax base assessment,” Fiegenschuh said. “You'll see a huge jump in the equalized assessed value (EAV) and a majority of any tax revenue they pay will go into that increment. It will generate a significant amount of increment and eventually when the TIF is gone that will all go to the school districts and all the other taxing districts. The thing I like about this TIF is the Sullivan's facility and the whole point of TIF is redevelopment of empty storefronts and empty blighted spaces. And that's what we're trying to do there.”
The city currently has three other TIF districts: The Lighthouse Pointe TIF (Walmart area), the Northern Gateway TIF and the Downtown TIF. Fiegenschuh said he believes all three of them have been successful in yielding developments.
Fiegenschuh encouraged residents to shop local if they want to see more shopping opportunities at the former site of Sullivan’s Foods and in the rest of the city.
“We're doing these projects, but there's three components,” Fiegenschuh said. “One is whether someone is willing to invest to try to turn a profit and create a business. The second is if there's a funding gap, is the city willing and able to help incentivize that? And the third part is the local consumers. People have to be willing to shop local. We want more shopping opportunities for people. Everybody does. But people need to shop local.”
Pease and Fiegenschuh thanked the mayor and city council for their support of the new TIF district and said that support shows foresight and a desire to grow Rochelle’s economic base and community. The city is excited for how the TIF district will aid in development in coming years.
“The biggest thing for me is we need to address that Sullivan's storefront,” Pease said. “It's wonderful to have development throughout the rest of that corridor. But that part of it is a vacant property in our community that's one of the first things people see when they come in that way. That's the biggest priority for me, filling that space with a viable business.”