By Igor Studenkov | Bugle Staff
nweditor@buglenewspapers.com
@BugleNewspapers
The expansion of the Hartz Plaza retail strip, which already applied for Class 7c property tax incentives, will be getting funding from the Milwaukee-Touhy Tax Increment Financing District.
The village of Niles Board of Trustees unanimously voted to sign off on the deal during its Aug. 23 meeting. Under the agreement, developer Mega Group will get $150,000 in TIF funding, but only if they finish the development over the next five years. A Class 7c tax classification would save the project additional money by reducing its property tax rates for five years.
As previously reported by the Bugle, Mega Group is looking to redevelop a vacant parcel directly west of the Hartz Plaza shopping strip, which it owns. The new structure would be an extension of the existing strip, with shoppers using the existing parking lot.
The village board previously signed off on the company getting Cook County 7c tax classification. The incentive reduces commercial properties’ tax rate from 25 percent to 10 percent for 10 years. For the next three years, the rate goes up 5 percent a year until it returns to the regular rate.
The development is located inside the Milwaukee-Touhy TIF. Established in 1996, it is scheduled to expire in 2019. The village has a right to renew it. As with all other TIFs, the amount of money taxing bodies collect within its boundaries is frozen. When those bodies raise their taxes, the extra amount gets deposited into a TIF fund.
As of April 2015 – the most recent date available – the fund had $6.14 million; $3.5 million of the total was set aside to help developers.
Trustees did not discuss the agreement details during the meeting, but Mitchell Johnson, the village of Niles communications director, said a total of $150,000 in TIF funding would be paid out in two phases to the developer after each phase of construction is completed.
“Payments will be made only if the developer completes the project within a [five-year] time frame,” Johnson said.