Lexington Club called eligible for St. Charles TIF
St. Charles’ pending Lexington Club development moved a step closer to approval Monday night after aldermen reviewed a new study that showed the city can help finance the project.
A report from a consultant hired by the city showed all aspects of the former Applied Composites site, and some adjacent parcels, meet the requirements that must exist before aldermen can create a new tax-increment financing district. Those requirements include existing incompatible property uses compared to the surrounding area, old buildings in various states of disrepair and other conditions that generally fall under the typical understanding of blight.
If aldermen agree to create a new TIF, the Lexington Club project’s developers would receive reimbursement of expenses they incur as the proposed 142 new residential structures generate new property tax dollars, and those dollars won’t go to the city’s general fund. The general fund pays most of the city’s operating expenses.
Lexington Club’s developers also have reached an agreement with local school and library officials that will address the problems those taxing bodies typically have with TIF districts.
Past TIF districts typically kept other taxing bodies from reaping any of the new property taxes for their own needs until the life span of the TIF district expired in 23 or more years. Developers have agreed St. Charles Unit District 303 and the St. Charles Public Library will receive some of the tax money created by the new homes to pay the costs associated with serving any new students or library patrons who move into the Lexington Club homes.
Both District 303 and the library would get their share of the new tax dollars before the developers receive their share. The payment to those taxing bodies from the TIF district is expected to be more than $6 million for the life of the TIF district if the number of expected new residents and students actually materializes.
Developers would receive about $4.9 million during the life of the TIF. That money will reimburse developers for costs they incur for site preparation, demolition of existing structures and cleanup of known pollution at the site. City officials said none of that money can be used to reimburse the developers for actually buying it.
Aldermen still must vote on the overall project and the creation of the TIF district before Lexington Club can move forward. Creation of the TIF may also pave the way for future redevelopment of properties near the old Applied Composites site that would be included in the TIF district but are not part of the Lexington Club project. Some of those properties already are owned by the city and park district.