One Peoria business is already in line to benefit from a possible new tax increment financing district the city is looking to create this year.
Black Band Distillery, which currently operates out of a century-old building in the Warehouse District, is looking to expand its operations to a large vacant warehouse at 2400 SW Washington St.
The property is among those in that area being considered for the new TIF, generally bounded by Washington, Sanger Street, MacArthur Highway and the Illinois River.
“We are looking at potentially creating what we're going to call the ‘Distillery TIF,’ which would encompass BioUrja, the old Hiram Walker distillery, as well as some other properties that aren't currently in either the Eagle View TIF or the Warehouse District TIF,” said Peoria City Manager Patrick Urich.
In an effort to move Black Band’s expansion forward, the city council in December approved an “inducement resolution” that allows the business to incur initial project expenses that could later be recouped once the Distillery TIF is established.
“Under the TIF act in Illinois, if there is a property owner or a developer that is looking to develop a property and they want to start incurring some of the expenses prior to the creation of the TIF, but still get reimbursed for those once the TIF is created, municipalities can pass an inducement resolution which basically says that any of the work that you do upfront can be reimbursed as part of the TIF once it's established,” Urich explained.
Urich notes that the inducement is not a guarantee, so the developer proceeds at risk of the TIF not being established. But he adds the resolution represents an acknowledgment the city fully intends to create the TIF.
The inducement measure also does not specify any specific amount of project costs that would be allowed or identify any other possible incentives.
“It does protect the ‘but for’ clause in the TIF act that says that without the TIF, this development isn't going forward by saying that they're operating under the good faith that the city is going to try and establish that TIF,” said Urich.
The text of the resolution indicates Black Band intends to redevelop the Washington Street warehouse to accommodate a larger distilling operation and other related facilities.
Pursuing other TIFs
Urich says the Distillery TIF is just one new incentive district the city might create this year, while also looking to push for more development in existing TIFs.
“We're also looking at a TIF along Galena Road, near the offices of Natural Fiber Welding,” said Urich. “We've been in talks with the water company (Illinois American Water) about some land that they have in that area, and that's something that we'll be looking at pursuing.”
Urich said attracting more developers to the Medina Plains/Allen Road business park with TIF incentives remains a priority for the city. At the December meeting, the council passed a redevelopment agreement for a $3.6 million Titan Fitness location.
“They would be eligible for reimbursement for their land acquisition costs and some of their site development work and some of their soft costs,” said Urich. “New construction is not an allowable expense in a TIF, so that they would have to pay for that. But it looks like over time, those total number of costs are about $1.1 million of TIF eligible expenses.”
Titan plans to move its operations from its current location on University Street to the Medina Plains site. The new facility is expected to offer 24-hour access, saunas, short-term child care, and a smoothie bar.
Urich estimates Titan collecting a total reimbursement of about $800,000 over the life of the agreement.
