ORDINANCE NO. 2021- -O-

DRAFT

ORDINANCE NO. 2021-____-O-___

AN ORDINANCE OF THE CITY OF ROCKFORD, WINNEBAGO AND OGLE

COUNTIES, ILLINOIS, APPROVING A FIRST AMENDMENT TO THE

REDEVELOPMENT PLAN AND REDEVELOPMENT PROJECT FOR THE

AMENDED AMEROCK HOTEL

REDEVELOPMENT PROJECT AREA

WHEREAS, the City of Rockford, Winnebago and Ogle Counties, Illinois (the “City”),

is a duly organized and existing municipal corporation created under the provisions of the laws of

the State of Illinois and under the provisions of the Illinois Municipal Code, as from time to time

supplemented and amended; and

WHEREAS, it is desirable and in the best interest of the citizens of the City of Rockford,

Winnebago and Ogle Counties, Illinois, for the City to continue to implement tax increment

allocation financing pursuant to the Tax Increment Allocation Redevelopment Act, 65 ILCS 5/11-

74.4-1 et seq., as amended (the "Act"), for a proposed first amendment to the redevelopment plan

and redevelopment project for the Amerock Hotel Tax Increment District (the "First Amendment")

located within the municipal boundaries of the City and further within a proposed amended

Amerock Hotel redevelopment project area (the "Amended Area") described in Section 2(A) of

this Ordinance, which Amended Area constitutes in the aggregate more than one and one-half

acres; and

WHEREAS, the City authorized a study in regard to the designation of the Amended Area

for the Amerock Hotel Tax Increment District and the preparation of the First Amendment in

relation thereto; and

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WHEREAS, the City made available for public inspection the Frist Amendment, with said

First Amendment containing an eligibility study (or qualifications report) for the Amerock Hotel

Tax Increment District, addressing the tax increment financing eligibility of the Amended Area

(the “Eligibility Study”); and

WHEREAS, the Mayor and City Council of the City (the "Corporate Authorities") desire

to implement tax increment financing pursuant to the Act for the First Amendment within the

municipal boundaries of the City and within the Amended Area described and depicted in Exhibit

A, Exhibit B, and Exhibit C, each being attached hereto and made part hereof; and

WHEREAS, pursuant to Section 11-74.4-5 of the Act, the Corporate Authorities called a

public hearing relative to the First Amendment and the designation of the Amended Area as a

redevelopment project area under the Act for May 17, 2021; and

WHEREAS, due notice with respect to such hearing was given pursuant to Section 11-

74.4-5 of the Act, said notice being given to taxing districts and to the Department of Commerce

and Economic Opportunity of the State of Illinois by certified mail on March 30, 2021, by

publication on March 25, 2021, and May 1 and May 2, 2021, by certified mail to taxpayers within

the Amended Area on April 30, 2021, and to residential addresses within 750 feet of the boundaries

of the Amended Area on April 30, 2021; and

WHEREAS, the City has heretofore convened a joint review board as required by and in

all respects in compliance with the provisions of the Act; and

WHEREAS, the joint review board met on April 15, 2021, to review the public record,

planning documents and proposed ordinances approving the First Amendment and Amended Area

and consider whether the First Amendment and Amended Area satisfy the requirements of the Act;

and

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WHEREAS, on April 15, 2021, the joint review board considered and approved a

resolution recommending approval of the Amended Area, First Amendment and the designation

of the Amended Area; and

WHEREAS, pursuant to the Act, the Corporate Authorities have waited at least fourteen

(14) days, but not more than (90) days, from the public hearing date to introduce this Ordinance to

the City Council of the City.

WHEREAS, the Corporate Authorities have reviewed the information concerning such

factors presented at the public hearing and have reviewed other studies and are generally informed

of the conditions in the proposed Amended Area that could cause the Amended Area to be a

“conservation area” as defined in the Act; and

WHEREAS, the Corporate Authorities have reviewed the conditions pertaining to lack of

private investment in the proposed Amended Area to determine whether private development

would take place in the proposed Amended Area as a whole without the adoption of the proposed

First Amendment; and

WHEREAS, the Corporate Authorities have reviewed the conditions pertaining to real

property in the proposed Amended Area to determine whether contiguous parcels of real property

and improvements thereon in the proposed Amended Area would be substantially benefited by the

proposed Project improvements; and

WHEREAS, it is the intent of the Corporate Authorities to utilize the tax increment from

all sources authorized by law; with such revenues to be exclusively utilized for the development

of the First Amendment within the Amended Area (except as provided in 65 ILCS 5/11-74.4-4(q));

and

WHEREAS, the Amended Area would not reasonably be redeveloped without the use of

such incremental revenues; and

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WHEREAS, the Corporate Authorities have reviewed the conditions pertaining to real

property in the proposed Amended Area to determine whether contiguous parcels of real property

and improvements thereon in the proposed Amended Area would be substantially benefited by the

proposed First Amendment; and

WHEREAS, the Corporate Authorities have reviewed the proposed First Amendment and

also the existing Comprehensive Plan for development of the City as a whole to determine whether

the proposed First Amendment conform to the comprehensive planning process of the City.

NOW, THEREFORE, BE IT ORDAINED by the Corporate Authorities of the City of

Rockford, Winnebago and Ogle Counties, Illinois, as follows:

SECTION 1. Recitals. That the above recitals and findings are found to be true and

correct and are hereby incorporated herein and made a part hereof, as if fully set forth in their

entirety.

SECTION 2. Findings. That the Corporate Authorities hereby make the following

findings:

a. The Amended Area is legally described in Exhibit A, a copy of which is

attached hereto and made a part hereof, as if fully set forth in its entirety. The general street

location for the Amended Area is described in Exhibit B, a copy of which is attached hereto and

made a part hereof, as if fully set forth in its entirety. The map of the Amended Area is depicted

on Exhibit C, a copy of which is attached hereto and made a part hereof, as if fully set forth in its

entirety.

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b. There exist conditions that cause the Amended Area to be subject to

designation as a redevelopment project area under the Act and classified as a “conservation area”

as defined in the Act.

c. The proposed Amended Area on the whole has not been subject to growth

and development through investment by private enterprise and would not be reasonably anticipated

to be developed without the adoption of the Plan.

d. The Amended Area would not reasonably be redeveloped without the tax

increment derived from real property tax incremental revenues, and the increment from such

revenues will be exclusively utilized for the redevelopment as outlined in the First Amendment

within the Amended Area (except as provided in 65 ILCS 5/11-74.4-4(q));

e. The First Amendment conforms to the Comprehensive Plan for the

development of the City as a whole.

f. As set forth in the First Amendment it is anticipated that all obligations

incurred to finance redevelopment project costs, if any, as defined in the First Amendment shall

be retired within twenty-three (23) years after the date of adoption of the original Amerock Hotel

Redevelopment Project Area is so designated.

g. The parcels of real property in the proposed Area are contiguous, and only

those contiguous parcels of real property and improvements thereon that will be substantially

benefited by the proposed Project improvements are included in the proposed Amended Area.

SECTION 3. First Amendment Approved. That the First Amendment, which were the

subject matter of the public hearing held on May 17, 2021, are hereby adopted and approved. A

copy of the First Amendment is set forth in Exhibit D, a copy of which is attached hereto and made

a part hereof, as if fully set forth in its entirety.

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SECTION 4. Severability. This Ordinance, and its parts, is declared to be severable and

if any section, clause, provision, or portion thereof of this Ordinance is declared invalid, the

invalidity thereof shall not affect the validity of any other provisions of this Ordinance which shall

remain in full force and effect.

SECTION 5. Superseder. All ordinances, resolutions, motions, or orders in conflict with

any provision of this Ordinance are, to the extent of such conflict, hereby repealed.

SECTION 6. Effective Date. This Ordinance shall be in full force and effect upon its

passage, approval and publication as provided by law.

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PASSED BY THE MAYOR AND THE CITY COUNCIL of the City of Rockford, Illinois,

at a regular meeting thereof on the ___ day of ____________, 2021, and approved by me as

Mayor on the same day.

VOTING AYE:

VOTING NAY:

ABSENT:

ABSTAIN:

APPROVED: , 2021

____________________________________

MAYOR

ATTESTED:

_______________________________________

LEGAL DIRECTOR

PASSED: APPROVED: PUBLISHED:

ATTESTED and FILED in my office this ______ day of _______________, 2021, and

published in pamphlet form this ______ day of ______________, 2021 by order of the City

Council of the City of Rockford, Illinois.

____________________________________

Legal Director and ex officio

Keeper of the Records and Seal

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APPROVED BY: ___________________________________

NICHOLAS O. MEYER, Legal Director

RECOMMENDED BY:

MEGAN MCNEILL, Assistant City Attorney

DRAFT

EXHIBIT A

AMEDNDED LEGAL DESCRIPTION

AMEROCK TIF AMENDED LEGAL DESCRIPTION

mmcneill

Typewritten text

TO BE PROVIDED

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EXHIBIT B

GENERAL STREET LOCATION

The Redevelopment Plan of the Amerock Hotel TIF District is amended to include certain tax

parcels to the north, east, south and west of its original boundaries. The expanded RPA is roughly

bound by:

Chestnut Street to the north, the Rock River to the east, Kent Creek to the

south and Winnebago Street to the west.

EXHIBIT C

MAP OF AMENDED REDEVELOPMENT PROJECT AREA

Cedar Street

Chestnut Street

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City of RockfordFirst Amendment Amerock TIF Boundary Map

TIF Boundary

Tax Parcels

Prepared by:0 0.02250.045 0.09 Miles

Sources: WINGIS tax parcel shapefile accessed 03/24/2021

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EXHIBIT D

FIRST AMENDMENT TO THE REDEVELOPMENT PLAN AND PROJECT

CITY OF ROCKFORD

FIRST AMENDMENT TO THE AMEROCK HOTEL TAX INCREMENT FINANCE

REDEVELOPMENT PLAN AND PROJECT

Prepared jointly by:

City of Rockford

and

Kane, McKenna and Associates, Inc.

June, 2021

Document Date Original Plan and Project October, 2017 First Amendment to Plan and Project June, 2021

First Amendment to the Amerock Hotel TIF Redevelopment Plan and Project City of Rockford, Illinois

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The City of Rockford’s Amerock TIF Redevelopment Plan and Project (attached as Exhibit 1) is amended as follows: 1. Section I “Introduction” Page 2 is amended by adding a new paragraph following the third

paragraph on that page to read as follows:

“The Redevelopment Plan of the Amerock Hotel TIF District is amended to include certain tax parcels (the “Amendment Area”) to the north, east, south and west of its original boundaries. The inclusion of these tax parcels is to further the TIF District’s two fundamental goals of promoting redevelopment and securing new economically productive uses for key parcels located within the central core of the City and diversifying the City’s tax base.”

2. Section I “Introduction” Page 4, is amended by adding a new paragraph following the

second paragraph of that page to read as follows:

“The Redevelopment Plan of the Amerock Hotel TIF District is amended to include certain tax parcels to the north, east, south and west of its original boundaries. The expanded RPA is roughly bound by:

Chestnut Street to the north, the Rock River to the east, Kent Creek to the south and Winnebago Street to the west.

In addition to achieving the City’s general economic development objectives of enhancing residential, commercial and mixed use opportunities, the expansion of the TIF district allows for the pursuit of the City’s general economic development objective of enhancing industrial opportunities. A map of the RPA’s boundaries as amended is included in Appendix 2b and is made part of this Redevelopment Plan and Project.”

3. Section II “RPA Legal Description,” Page 8, is amended by adding a new paragraph

following the first paragraph of that page to read as follows:

“The Redevelopment Project Area legal description as amended is attached as Appendix 1b and is made part of this Redevelopment Plan.”

4. Section IV “Evidence of the Lack of Development and Growth; Fiscal Impact on Taxing

Districts” Page 13 is amended by adding a new paragraph following the first paragraph of that page to read as follows:

“As part of the First Amendment to the Amerock Hotel TIF Redevelopment Plan and Project, the Amendment Area was studied in order to determine its qualifications under the Act. It was determined that the Amendment Area qualifies under the Act as a conservation area. The TIF Eligibility Report for the Amendment Area is attached as Appendix 8 and is made part of this Redevelopment Plan.”


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5. Section V ”TIF Qualification Factors Present in the RPA” Page 15 is amended by adding

a new sentence to the end of the first paragraph to read as follows:

“Refer to the TIF Eligibility Report for the Amendment Area, attached as Appendix 5b to this Plan.”

and; by adding a new paragraph following the second paragraph of that page to read as follows:

“In addition to initial evaluations, representatives of KMA and City staff evaluated the Amendment Area beginning in the Summer of 2020 to the date of the First Amendment to the Amerock Hotel TIF Redevelopment Plan and Project. Analysis was aided by certain reports obtained from City staff, on-site due diligence and other sources.”

6. Section VI ”Redevelopment Project” Page 24 is amended by replacing Exhibit 4 with the

following figure:


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Table 3. Redevelopment Project Cost Estimates

Program Actions/Improvements Estimated Costs Land Acquisition, Assembly and Relocation

$3,500,000

Site Preparation including Environmental Remediation, Demolition and Site Grading

$6,000,000

Utility Improvements including Water, Storm and Sanitary Sewers, Service of Public Facilities and Road Improvements

$6,500,000

Rehabilitation of Existing Structures, Taxing District Capital Improvements

$20,000,000

Public Facilities including Parking Facilities and Streetscaping

$5,000,000

Interest Costs Pursuant to the Act

$1,000,000

Professional Service Costs (Including Planning, Legal, Engineering, Administrative, Annual Reporting and Marketing)

$1,000,000

Job Training

$500,000

Statutory School District Payments

$5,000,000

TOTAL ESTIMATED TIF BUDGET $48,500,000 Notes: (1) All project cost estimates are in 2021 dollars. Costs may be adjusted for inflation per the TIF Act. This is an increase to the budget set with the Original Plan and Project, which had been set an amount of $23,750,000. (2) In addition to the costs identified in the exhibit above, any bonds issued to finance a phase of the Project may include an amount sufficient to pay (a) customary and reasonable charges associated with the issuance of such obligations, (b) interest on such bonds, and (c) capitalized interest and reasonably required reserves. (3) Adjustments to the estimated line-item costs above are expected. Adjustments may be made in line-items within the total, either increasing or decreasing line-items costs for redevelopment. Each individual project cost will be reevaluated in light of the projected private development and resulting tax revenues as it is considered for public financing under the provisions of the Act. The totals of the line-items set forth above are not intended to place a total limit on the described expenditures, as the specific items listed above are not intended to preclude payment of other eligible redevelopment project costs in connection with the redevelopment of the RPA – provided the total amount of payment for eligible redevelopment project costs shall not exceed the overall budget amount outlined above and all as provided for in the Act.


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7. Section VI ”Redevelopment Project” Page 26 is amended by replacing the third and fourth paragraphs of that page with the following:

“Most Recent Equalized Assessed Valuation (EAV) for the RPA. The most recent EAV for the Amendment Area is based on 2019 tax year EAV and is estimated to be approximately $699,686. It is anticipated the base equalized assessed value of the Amendment Area will be the 2019 tax year. The base equalized assessed value of the original RPA has been set by the Winnebago County Clerk’s office at an amount of $154,853 based on tax year 2016. That amount and tax year will not be affected by this Amendment. Anticipated Equalized Assessed Valuation for the RPA. Upon completion of the anticipated private development of the RPA over a 23-year period, it is estimated that the EAV of the property within the RPA as amended will be approximately $31.8 million depending upon market conditions and the scope of redevelopment projects.”


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New Appendix Items Appendix 1b – “Amended Legal Description of Project Area” Appendix 3b – “Amended Boundary Map of RPA” Appendix 4b - “Amended Existing and Future Land Use Maps of RPA” Appendix 5b – “TIF Eligibility Report for the Amendment Area” Appendix 6b – “TIF PIN List for Original RPA Only” Appendix 7b – “TIF PIN List for Amendment Area Only”

APPENDIX 1b

Amended Legal Description of Project Area

October 29, 2020

AMEROCK TIF LEGAL DESCRIPTION

Part of the Southwest Quarter of Section 23, part of the Southeast Quarter of Section 22, part of the Northwest Quarter of Section 26, and part of the Northeast Quarter of Section 27 all in Township 44 North, Range 1 East of the Third Principal Meridian, bounded and described as follows; beginning at the Southwest corner of Lot 10 in Block 16 as designated upon the Plat of that part of the Original Town (now city) of Rockford, on the West side of Rock River, the Plat of which is recorded in Book D of Deeds on pages 428 & 429 in the Recorder’s Office of Winnebago County, Illinois, thence northeasterly along the westerly line of Lots 10, 11, and 12 in said Block 16, a distance of 190 feet, more or less, to the centerline of Chestnut Street; thence easterly, along the centerline of Chestnut Street, a distance of 679 feet, more or less, to the westerly bank of the Rock River; thence southerly, along the westerly bank of the Rock River, a distance of 1118 feet, more or less, to the southerly right of way line for the Union Pacific Railroad; thence westerly, along the southerly line of said Union Pacific Railroad right of way line, a distance of 130.5 feet, more or less, to its intersection with a line that is 104.65 feet perpendicularly distant easterly from and parallel with the centerline of Wyman Street (now vacated); thence southerly, along said parallel line, a distance of 98.63 feet; thence westerly at right angles from the previous course, a distance of 98.6 feet; thence South 73 degrees 50 minutes West, a distance of 26 feet to the southwesterly line of premises vacated by the City recorded in Book 21 of Plats on page 359 in said Recorder’s Office; thence northwesterly along the southwesterly line of said premises so vacated, a distance of 180 feet, more or less, to the westerly line of Lot 6 in Block 3 as designated upon said Plat of that part of the Original Town (now city) of Rockford, on the West side of Rock River; thence westerly, at right angles from the westerly line of said Block 3, a distance of 33 feet to the centerline of South Main Street; thence southerly, along said centerline, a distance of 480.5 feet, more or less, to the easterly extension of the northerly line of premises conveyed to David Ayres and Cynthia Campbell by Warranty deed recorded as Document No. 200800845075 in said Recorder’s Office; thence westerly, along said extension and along the northerly line of said premises conveyed to Ayres and Campbell, a distance of 284.8 feet to the northwest corner of said premises conveyed to Ayres and Campbell; thence southerly, along the westerly line of said premises conveyed to Ayres and Campbell and along the southerly extension of said line, a distance of 142.33 feet to the centerline of Tinker Street as laid out and established in Book 72 of Mortgages on page 179 in said Recorder’s Office; thence easterly, along said centerline, a distance of 284.8 feet to the centerline of said South Main Street; thence southerly, along the centerline of South Main Street, a distance of 15 feet, more or less, to the westerly extension of the northerly line of Lot 3 in Block 1 as designated upon said Plat of that part of the Original Town (now city) of Rockford, on the West side of Rock River; thence easterly along said extension and along the northerly line of said Lot 3 and along the easterly extension of said northerly line, a distance of 183 feet; thence southerly, parallel with the centerline of said South Main Street, a distance of 135 feet; thence westerly, parallel with the northerly line of said Lot 3 in Block 1, a distance of 10 feet; thence southerly, parallel with the centerline of South Main Street, a distance of 141.71 feet; thence South 73 degrees 33 minutes, a distance of 14 feet to the northerly line of Mill Street; thence westerly, along the northerly line of said Mill Street, a distance of 163 feet, more or less, to the

centerline of South Main Street; thence southerly, along the centerline of said South Main Street, a distance of 260 feet, more or less, to the northerly bank of Kent Creek; thence westerly and northerly along the northerly bank of Kent Creek and the northeasterly bank of the North Fork of Kent Creek, a distance of 1548 feet, more or less, to the centerline of South Winnebago Street; thence northerly, along the centerline of South Winnebago Street, a distance of 699 feet, more or less to the westerly extension of the southerly line of premises conveyed to Donald Swinson by Quit Claim Deed recorded in Microfile 88-05-2387 in said Recorder’s Office; thence easterly along said extension and along the southerly line of said premises conveyed to Swinson and the easterly extension of said southerly line, a distance of 396 feet, more or less, to the centerline of South Court Street; thence northerly along the centerline of South Court Street, a distance of 175 feet, more or less, to the centerline of Cedar Street; thence easterly, along the centerline of Cedar Street, a distance of 791 feet to the centerline of South Main Street; thence northerly, along the centerline of South Main Street, a distance of 605 feet to the easterly extension of the southerly line of said Lot 10 in Block 16; thence westerly along said extension and along the southerly line of said Lot 10, a distance of 190 feet to the point of beginning; situated in the City of Rockford, the County of Winnebago and the State of Illinois; containing 49.4 acres, more or less.

APPENDIX 2b

Amended Boundary Map of RPA

Cedar Street

Chestnut Street

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TIF Boundary

Tax Parcels



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APPENDIX 4b

Amended Existing and Future Land Use Maps of RPA

Cedar Street

Chestnut Street

S Chu

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S Main

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City of RockfordFirst Amendment Amerock TIF Existing Land Use Map

TIF Boundary

Tax Parcels

Land UseIndustrial

Urban Mixed Use



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Cedar Street

Chestnut Street

S Chu

rch St

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S Main

Stree

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S Cou

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City of RockfordFirst Amendment Amerock TIF Future Land Use Map

TIF Boundary

Tax Parcels

Land UseUrban Mixed Use



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APPENDIX 5b

Eligibility Report for Amendment Area

CITY OF ROCKFORD, ILLINOIS FIRST AMENDMENT TO THE AMEROCK HOTEL TIF

DISTRICT ELIGIBILITY REPORT

Prepared By:

City of Rockford, Illinois &

Kane, McKenna and Associates, Inc.

June, 2021

TABLE OF CONTENTS

EXECUTIVE SUMMARY ............................................................................................................. i

I. INTRODUCTION ................................................................................................................... 1

II. QUALIFICATION CRITERIA ........................................................................................... 4

III. METHODOLOGY OF EVALUATION ............................................................................. 7

IV. QUALIFICATION FINDINGS FOR STUDY AREA ........................................................ 8

V. SUMMARY ....................................................................................................................... 14

APPENDIX A: Tax Parcels within Study Area ............................................................................. A

APPENDIX B: Boundary Map of Study Area ............................................................................... B

City of Rockford, First Amendment to the Amerock Hotel TIF District Eligibility Report i

EXECUTIVE SUMMARY

The City of Rockford, Illinois (the “City”) is pursuing the first amendment to the existing Amerock Hotel Tax Increment Finance District (the “TIF District”, “Redevelopment Project Area” or “RPA”) to continue the promotion and revitalization of underutilized properties in a portion of the City’s Downtown. In the context of planning for the amendment of the RPA, the City has initiated the study of certain additional tax parcels adjacent to the existing Amerock Hotel TIF District (the “Study Area”) to determine whether they qualify separately or in aggregate under the Tax Increment Allocation Redevelopment Act, 65ILCS 5/11-74.4-3, et seq., as amended (the “TIF Act” or “Act”) for inclusion in the RPA. Kane, McKenna and Associates, Inc. (KMA) has been retained by the City to conduct this study on the City’s behalf. KMA has reached the following conclusions regarding the qualification of the Study Area based upon the analysis completed to date:

1) The Study Area qualifies as a conservation area - The Study Area qualifies as a conservation area as defined in the TIF Act. The conservation area factors found in the Study Area are present to a meaningful extent and are distributed throughout the area.

2) Current conditions impede redevelopment – The existence of certain conditions found within the Study Area present a barrier to the area’s successful redevelopment. The current conditions in the Study Area are impediments to redevelopment, creating an environment where it is reasonable to conclude redevelopment would not take place “but for” the use of the TIF Act. The factors present on the ground negatively impact coordinated and substantial private sector investment in the overall area. Without the use of City planning and economic development resources to mitigate such factors, potential redevelopment projects and other activities that require private sector investment are not likely to be economically feasible.

3) Viable redevelopment sites could produce incremental revenue - The Study Area potentially could, with TIF-related assistance, be redeveloped and thereby produce incremental property tax revenue. Such revenue, used in combination with other City resources for redevelopment incentives or public improvements, would likely stimulate private investment and reinvestment in these sites in the Study Area.

4) TIF amendment is recommended - To mitigate conservation area conditions, promote private sector investment, and foster the economic viability of the Study Area, KMA recommends that the City proceed with the formal TIF amendment process to include the properties described within this report into the existing Amerock Hotel TIF District.

City of Rockford, IL First Amendment to the Amerock Hotel TIF District Eligibility Report 1

I. INTRODUCTION Description of the Study Area The Study Area is located in the central portion of the City of Rockford, Illinois and in the southern portion of its Downtown. The area is a gateway into the City’s Downtown and contains or is near key destination points (e.g. Davis Park, BMO Harris Bank Center, U.S. District Court building, etc.). The surrounding area is characterized by a wide variety of land uses including commercial, institutional, residential and mixed uses. The Study Area generally consists of certain tax parcels that run along Main Street from Kent Creek to the south to Chestnut Street to the north. The Study Area includes a number of former industrial uses, commercial uses and mixed uses. The Study Area consists of 27 tax parcels that are approximately 85 acres in size incuding right-of-ways. Please see Appendix A for a list of the tax parcels included in the Study Area and Appendix B for a visual depiction of the Study Area. Background The Study Area is located in the southern portion of the City of Rockford’s Downtown. The area is considered a gateway into the City’s central core and connects the South Main Street commercial area located to the south of Kent Creek with the City’s Downtown to the north. The Study Area’s history follows the greater history of industrial development in the City of Rockford closely. Beginning in the early-1800’s the area developed to accommodate industrial users taking advantage of nearby Kent Creek and the Rock River. The Galena and Chicago Union Railroad, Chicago’s first railroad, was constructed through the area in the mid-1830s which eventually attracted freight depots and other rail services. By the late-1800s a number of manufacturers had located and constructed factories or warehouses throughout the Study Area. The Study Area remained an active and vibrant place of industrial activity until the late-20th Century when the needs of industrial users began to shift them away from the central cores of cities. Structures throughout the Study Area were vacated and fell into states of disrepair. In some cases, the degree of disinvestment and disrepair prompted the City to purchase and demolish or repurpose properties within the Study Area. Conditions exist today, within the Study Area, that impede private reinvestment. Over recent years, efforts have been made to mitigate these conditions and encourage redevelopment of the area including the designation of the South Rockford and Westside #2 TIF Districts. However, these efforts have yet to successfully arrest those conditions which challenge successful redevelopment of those tax parcels that are the subject of this report.


Given the existing conditions of the area, the effect of past redevelopment efforts and the importance of the Study Area in fulfilling the City’s economic and community development goals, the City has determined that the area be studied for possible inclusion into the existing Amerock Hotel Tax Increment Finance District. The City with the assistance of Kane, McKenna and Associates, Inc. (KMA), has commissioned this Eligibility Report as part of an amendment to the Amerock Hotel Tax Increment Finance Redevelopment Plan in order to alleviate those conditions which deter private investment in the area and to meet certain redevelopment goals and objectives. Overview of Tax Increment Financing (TIF) Tax Increment Financing (or “TIF”) is an economic development tool which uses future revenues to finance redevelopment activity. In the State of Illinois an area can be designated as a TIF district if it faces certain impediments to redevelopment. At the time of designation, the equalized assessed value of tax parcels within the boundaries of the district are “frozen” for the term of the TIF district. Taxing jurisdictions that overlap that district continue to receive property taxes, but those revenues generated from increase in equalized assessed value relative to the frozen values are deposited in a special tax allocation fund. This revenue is then used to finance redevelopment activities within the district to accomplish community and economic development goals. The Eligibility Report The TIF Act enables Illinois municipalities to establish and amendTIF districts either to eliminate the presence of blight or to prevent its onset. The Act finds that municipal TIF authority serves a public interest in order to, “promote and protect the health, safety, morals and welfare of the public, that blighted conditions need to be eradicated and conservation measures instituted, and that redevelopment of such areas be undertaken; that to remove and alleviate adverse condition sit is necessary to encourage private investment and restore and enhance the tax base of the taxing districts in such areas by the development or redevelopment of project areas” (65 ILCS-5/11-74.4-2(b)). To establish a TIF district Illinois municipalities must adopt several documents including a Redevelopment Plan and an Eligibility Report. An Eligibility Report is a document which provides the basis for the RPA’s qualification under the TIF Act in reasonable detail. If a TIF district is amended by adding tax parcels to the existing TIF district, Illinois municipalities must adopt an Eligibility Report for those additional tax parcels and adopt an amendment to the existing Redevelopment Plan. The City has authorized KMA to evaluate the Study Area in relation to its inclusion into the existing Amerock Hotel TIF district, to prepare a TIF District Eligibility Report for the Study Area and to prepare a Redevelopment Plan for the RPA.


Determination of the “But-For” Historically, it was advantageous for industrial uses to locate near the central core of cities, along railways and waterways and on smaller parcels of land as compared to current market standards. As the needs of industrial users have shifted with national and regional trends, areas which are no longer ideal for such users face increasing challenges in attracting private investment. The Study Area is one such location and the City has determined that planned redevelopment of the Study Area is feasible only with public financial assistance. The creation and utilization of a TIF redevelopment plan and redevelopment agreements is intended by the City to help provide the assistance required to eliminate conditions detrimental to successful redevelopment of the Study Area, strengthen the tax base and improve resident quality of life. General Scope and Methodology KMA formally began its analysis by conducting a series of meetings and discussions with City staff starting in Spring 2020 and continuing up to the date of this report’s issuance. The purpose of the meetings was to establish boundaries for initial analysis and to gather data related to the qualification criteria for parcels included in the Study Area. These meetings were complemented by a series of field surveys for the entire area to evaluate conditions in the Study Area. KMA also analyzed the City’s most recent comprehensive plan and other reports relevant to the Study Area. Properties within the Study Area were examined in the context of the TIF Act governing improved areas (separate provisions of the Act address non-improved or vacant areas). The qualification factors discussed in this report qualify the area as a “conservation area,” as the term is defined pursuant to the TIF Act. During the course of its work, KMA reported findings to key City staff regarding TIF qualification and the feasibility of redevelopment within the Study Area. Based upon these findings the City directed KMA to complete this report and move forward with the preparation of an amendment to the existing Redevelopment Plan and Project for the RPA. For additional information about KMA’s data collection and evaluation methods refer to Section IV of this report.


II. QUALIFICATION CRITERIA

The TIF Act sets out specific procedures for qualifying and amending an RPA. By definition, a RPA is:

“An area designated by the municipality, which is not less in the aggregate than 1½ acres and in respect to which the municipality has made a finding that there exist conditions which cause the area to be classified as a blighted area or a conservation area, or a combination of both blighted areas and conservation areas.”

Under the TIF Act, “conservation area” means any improved area within the boundaries of a RPA located within the territorial limits of the municipality where: 50% or more of existing structures are 35 years or older in age At least three of 13 eligibility factors are present and distributed to a meaningful extent

The 13 possible eligibility factors are:

1. Dilapidation: An advanced state of disrepair or neglect of necessary repairs to the primary structural components of building or improvements in such a combination that a documented building condition analysis determines that major repair is required or the defects are so serious and so extensive that the buildings must be removed.

2. Obsolescence: The condition or process of falling into disuse. Structures become ill-suited

for the original use.

3. Deterioration: With respect to buildings, defects are evident, including, but not limited to, major defects in the secondary building components such as doors, windows, porches, gutters, downspouts, and fascia. With respect to surface improvements, that the condition of roadways, alleys, curbs, gutters, sidewalks, off-street parking and surface storage areas demonstrate evidence of deterioration, including, but limited to, surface cracking, crumbling, potholes, depressions, loose paving material and weeds protruding through paved surfaces.

4. Presence of Structures Below Minimum Code Standards: All structures that do not meet

the standards of zoning, subdivision, building, fire and other governmental codes applicable to property, but not including housing and property maintenance codes.

5. Illegal Use of Individual Structures: The use of structures in violation of applicable

Federal, State, or local laws, exclusive of those applicable to the presence of structures below minimum code standards.

6. Excessive Vacancies: The presence of buildings that are unoccupied or under-utilized and

that represent an adverse influence on the area because of the frequency, extent, or duration of the vacancies.


7. Lack of Ventilation, Light, or Sanitary Facilities: The absence of adequate ventilation for

light or air circulation in spaces or rooms without windows, or that require the removal of dust, odor, gas, smoke or other noxious airborne materials. Inadequate natural light and ventilation means the absence of skylights or windows for interior spaces or rooms and improper window sizes and amounts according to room area to window area ratio requirements. Inadequate sanitary facilities refer to the absence or inadequacy of garbage storage and enclosure, bathroom facilities, hot water and kitchens and structural inadequacies preventing ingress and egress to and from all rooms and units within a building.

8. Inadequate Utilities: Underground and overhead utilities such as storm sewers and storm

drainage, sanitary sewers, water lines and gas, telephone and electrical services that are shown to be inadequate. Inadequate utilities are those that are: (i) of insufficient capaCity to serve the uses in the RPA; (ii) deteriorated, antiquated, obsolete or in disrepair; or (iii) lacking within the RPA.

9. Excessive Land Coverage and Overcrowding of Structures and Community Facilities: The

over-intensive use of property and the crowding of buildings and accessory facilities onto a site. Examples of problem conditions warranting the designation of an area as exhibiting excessive land coverage are: (i) the presence of buildings either improperly situated on parcels or located on parcels of inadequate size and shape in relation to present-day standards of development for health and safety and (ii) the presence of multiple buildings on a single parcel. For there to be a finding of excessive land coverage, these parcels must exhibit one or more of the following conditions: insufficient provision for light and air within or around buildings, increased threat of spread of fire due to the close proximity of buildings, lack of adequate or proper access to a public right-of-way, and lack of reasonably required off-street parking or inadequate provision for loading service.

10. Deleterious Land-Use or Layout: The existence of incompatible land-use relationships,

buildings occupied by inappropriate mixed-uses or uses that are considered to be noxious, offensive or unsuitable for the surrounding area.

11. Environmental Clean-Up: The RPA has incurred Illinois Environmental Protection

Agency or United States Environmental Protection Agency remediation costs for (or a study conducted by an independent consultant recognized as having expertise in environmental remediation has determined a need for) the clean-up of hazardous waste, hazardous substances or underground storage tanks required by State or federal law. Any such remediation costs would constitute a material impediment to the development or redevelopment of the RPA.

12. Lack of Community Planning: The RPA was developed prior to or without the benefit or

guidance of a community plan. This means that the development occurred prior to the adoption by the municipality of a comprehensive or other community plan or that the plan was not followed at the time of the development of the area. This factor must be


documented by evidence of adverse or incompatible land-use relationships, inadequate street layout, improper subdivision, parcels of inadequate shape and size to meet contemporary development standards or other evidence demonstrating an absence of effective community planning.

13. Lagging or Declining EAV: The total equalized assessed value (EAV) of the RPA has

declined for three (3) of the last five (5) calendar years prior to the year in which the RPA is designated, or is increasing at an annual rate that is less than the balance of the municipality for three (3) of the last five (5) calendar years, for which information is available or increasing at an annual rate that is less than the Consumer Price Index for All Urban Consumers published by the United States Department of Labor or successor agency for three (3) of the last five (5) calendar years prior to the year in which the RPA is designated.


III. METHODOLOGY OF EVALUATION

The following method was applied to evaluate the Study Area’s qualification as a TIF district.

1. KMA representatives collected primary data during site visits to the Study Area. These site visits consisted of visual observation of the area which included, but was not limited to, tax parcel counts, address matches and the identification of current land uses, building conditions, lot conditions and traffic flows. KMA documented these observations via notes and photography.

2. KMA representatives collected secondary data including, but not limited to, 2014 to 2019

tax information, tax parcel maps, site data, planning documents and information related to local history and context from interviews with City staff and other stakeholders.

3. The age of existing structures was ascertained by matching data collected during site visits

to local tax and building records to determine if the Study Area would qualify as a conservation area as defined by the TIF Act.

4. KMA also utilized the collected data to conduct an evaluation of the presence and extent

of the aforementioned eligibility factors (e.g. deterioration, excessive vacancies, etc.) that would qualify the Study Area as a conservation area as defined by the TIF Act.


IV. QUALIFICATION FINDINGS FOR STUDY AREA

Summary of Age Findings for a Conservation Area As mentioned in Section II of this report, an area may qualify as a conservation area under the TIF Act if 50% or more of existing structures are 35 years in age or older. KMA collected primary data from site surveys and secondary data from the Rockford Township Assessor and the City of Rockford regarding the age of existing structures within the Study Area. KMA found that at least six of the nine existing structures in the Study Area are 35 years in age or older.1 Therefore, it is possible for the Study Area to qualify as a conservation area as defined by the TIF Act.

Table 1. Summary of Age Findings for Conservation Area

Total number of structures in Study Area 9

Number of structures in Study Area at least 35 years or older in age 6

Percent of structures in Study Area at least 35 years or older in age 67%

Summary of Factor Findings for a Conservation Area Once it was established that the Study Area may qualify as a conservation area based upon the age threshold of structures within the area, KMA analyzed the Study Area in relation to the 13 aforementioned eligibility factors. Three of these factors must be present and distributed to a meaningful extent within the Study Area to qualify the area as a conservation area under the TIF Act. KMA determined that six of the 13 possible factors were present and distributed to a meaningful extent within the Study Area.

Table 2. Summary of Factor Findings for Conservation Area

Total number of possible factors per TIF Act 13

Minimum factors needed to qualify per TIF Act 3

Factors present in Study Area 6

The nine factors found to be present and distributed to a meaningful extent within the Study Area are:

1. Lack of Community Planning 2. Deleterious Land Use or Layout 3. Lagging/Declining EAV 4. Excessive Vacancies 5. Deterioration

1 Age for two existing structures located on 11-27-505-013 could not be identified. Visually it appears these structures are more than 35 years in age; however KMA adopted the strictest interpretation for the age finding and has proceeded by not counting these properties in the list of those that are 35 years in age or older.


6. Obsolescence These factors are summarised as follows:

1. Lack of Community Planning: The Act states that this factor is present if the Study Area developed prior to or without the benefit or guidance of a community plan. This factor must be documented by evidence of adverse or incompatible land use relationships, an inadequate street layout, improper subdivision, parcels of inadequate shape or size to meet contemporary development standards or other evidence demonstrating an absence of effective community planning.

When evaluating an area for the presence of this factor it is helpful to compare the age of existing structures with any key community planning events in the area’s history. In the case of the Study Area, and as indicated in the below Table 3, at least six of the nine existing structures in the Study Area, or 67% of existing structures, were built prior to the approval of the City’s original comprehensive plan in 1972. Notably, at least five of the nine existing structures, or 56% of existing structures, were built prior to or in the same decade that the U.S. Congress passed the Standard State Zoning Enabling Act (SZEA) -an event often cited as the beginning of modern community planning. The development that has occurred in the Study Area took place in an era prior to modern community planning techniques and without the benefit of guidance from comprehensive and coordinated planning.

Table 3. Support for Lack of Community Planning Factor


Number of structures in Study Area at least older than 1972 6

Percent of structures in Study Area older than 1972 67%


Number of structures in Study Area at least contemporary or older to SZEA 5

Percent of structures in Study Area at least contemporary or older to SZEA 56%

This lack of guidance from comprehensive and coordinated planning is evidenced by the presence of incompatible land use relationships, an inadequate street layout and tax parcels of inadequate shape to meet contemporary development standards. The Study Area is primarily comprised of active and inactive industrial uses and such uses are out of character with the area’s greater surroundings. Downtown Rockford, of which the Study Area acts as a gateway to, is characterized by dense commercial, residential, institutional and mixed uses. Historically, it was advantageous for industrial users to locate in the central core of cities. However, changes in industrial users needs means the advantages of a central location no longer outweigh the disadvantages caused by conflicting land use relationships. In the case of the Study Area active and inactive


industrial uses abut or are in close proximity to a variety of uses which are adversely impacted by the noise, traffic and visual aesthetic that accompanies industrial use. The Study Area’s former history as an industrial area has also impacted the efficacy of the existing road layout to serve non-industrial uses. Several rail right-of-ways and Kent Creek cross through the Study Area creating substantial barriers to the continuation of Rockford’s street grid from the north and south of the Study Area. Along with challenging the creation of an effective gateway into Downtown Rockford along Main Street, these natural barriers also challenge private reinvestment into the area due to a lack of existing road infrastructure to support non-industrial uses. The lack of existing road infrastructure within the Study Area also results in the presence of parcels of inadequate size and shape to accommodate non-industrial uses. Many tax parcels within the Study Area are too large to accommodate uses that would be consistent with the Study Area’s surroundings (i.e. commercial, institutional, residential and mixed uses) or are “orphaned” within a larger tax parcel and lack appropriate access to facilitate redevelopment. In all three cases described above, existing conditions are a result of the Study Area’s early development as an industrial area located in the central core of a City. A lack of guidance from community planning in the area’s initial development has resulted in an area that is not easily adaptable to changes in primary use and has such created substantial challenges to attracting private investment in the area’s redevelopment.

2. Deleterious Land Use or Layout: The act states that deleterious land use and or layout

occurs with the existence of incompatible land use relationships, buildings occupied by inappropriate mixed uses or when uses are considered to be noxious, offensive or unsuitable for the surrounding area.

As described in the “Lack of Community Planning” factor finding, incompatible land use relationships are present within the Study Area. Active and non-active industrial properties abut or are in close proximity to commercial, residential, institutional and mixed uses. These types of uses are adversely impacted by the noise, traffic and visual aesthetic that accompanies industrial use. Furthermore, the presence of industrial uses challenges the ability of Main Street to act as an effective gateway into Downtown Rockford due to the inconsistency in land use along the corridor and the presence of industrial-related traffic.

3. Lagging/Declining Equalized Assessed Value (EAV): This factor is present if the total

equalized assessed value (EAV) of the Study Area has either: (i) declined for three of the last five calendar years prior to the year in which the area is to be designated; (ii) changed at an annual rate that is less than the annual rate of change (i.e. lagged) of the balance of the municipality’s EAV for three of the last five calendar years prior to the year in which the area is to be designated; or (iii) changed an annual rate that is less than the annual rate of change (i.e lagged) of the Consumer Price Index for All Urban Consumers (CPI-U) as


published by the United States Department of Labor or successor agency for three of the last five calendar years prior to the year in which the area is to be designated.

Data regarding change in historical EAV for the Study Area and the City, as well as change in the CPI-U, is presented in the following Table 4.

Table 4. Annual Rates of Change for Tax Years 2019 to 2015 for Study Area EAV and CPI-U

Tax Year 2019 2018 2017 2016 2015 2014 Study Area EAV 699,686 659,400 631,064 625,651 626,004 644,422 EAV Change 6.1% 4.5% 0.9% -0.1% -2.9% - Years Declined - - - X X City EAV Change 7.1% 4.1% 1.9% 1.1% -3.1% - Years Lagged Citye X - X X - CPI-U 1.80% 2.40% 2.10% 1.30% 0.10% - Years Lagged CPI-U - - X X X

The Study Area qualifies under two measurements; that is, the rate of annual change of the total EAV of the Study Area; (a) lagged the balance of the City’s EAV for three of the last five calendar years prior the most recent year in which the Study Area is to be added; and, (b) lagged the CPI-U for four of the last five calendar years prior to the year in which the Study Area is to be added.

4. Excessive Vacancies: The Act describes excessive vacancies as the presence of buildings

that are unoccupied or underutilized and that represent an adverse influence on the area because of the frequency extent or duration of the vacancies. Historically the Study Area developed as an extremely active and vibrant industrial area. However, as the needs of industrial users began to change in the late-20th Century, vacancy and disuse began to characterize the Study Area. The degree of disrepair that had befallen a number of vacated structures in the Study Area led to the City purchasing and demolishing or repurposing several structures over the past three decades. As indicated in the below Table 5, at the time of KMA’s site surveys of the area, five of the nine existing structures in the Study Area, or 56% of existing structures, were found to be vacant and in a state of disrepair. Indeed, three of the four structures not found to be vacant were all part of the same active industrial site and the remaining non-vacant structure was the repurposed industrial “Lorden” building in Davis Park.

Table 5. Summary of Vacancy Findings


Number of vacant structures in Study Area 5

Percent of vacant structures in Study Area 56%


Currently, there are a number of vacant buildings and inactive industrial sites The extent of vacancy in the area creates certain conditions which create an adverse impact on the area and impede private redevelopment efforts. This impact is heightened by the high degree of visibility of these structures, many of which are located along Main Street, a gateway into Downtown Rockford. The degree of deterioration associated with the vacancies contributes to a “tired” appearance which discourages reinvestment and suggests an area whose time has passed.

5. Deterioration: The Act describes deterioration in the context of secondary building components and surface improvements. For secondary building components (e.g. doors, windows, porches, gutters and downspouts and fascia) deterioration may be evidenced by the presence of major defects. For surface improvements (e.g. roadways, alleys, curbs, gutters, sidewalks, off-street parking and surface storage areas), deterioration may be evidenced by surface cracking, crumbling, potholes, depressions, loose paving material and weeds protruding through paved surfaces. In July 2020 KMA conducted an analysis of the condition of existing improvements within the Study Area. This analysis included the collection of primary data from on-site surveys as well as the review of various building condition reports. Deterioration was found to be present in secondary building components throughout the Study Area. Several vacant industrial buildings were found to be in an extreme state of disrepair. Common required repair items include brick, cement and other exterior surface materials breaking and falling off exterior walls, broken, rotting and/or unsecured doorways and windows, exposed electrical wiring and damaged roofing. Signs of trespassing in structures was observed. The level of deterioration of some structures in combination with the lack of securitization suggests a potential safety hazard to community members.

Deterioration was also found to be present in surface improvements throughout the Study Area. Surface improvements primarily consist of parking areas, walkways, former rail right-of-ways and overpasses. At the time of KMA’s survey observations included, but were not limited to, cracked and crumbling asphalt, cracked, crumbling and spalling concrete, unkempt landscaping and weeds protruding through surface improvements.

6. Obsolescence: The Act states that obsolescence is the condition or process of falling into

disuse or structures that have become ill-suited for their original use. Historically, the Study Area developed to accommodate industrial users. As the needs of industrial users have changed with time, improvements within the Study Area have fallen into disuse and have become ill-suited for their original use.


Obsolescence is most directly observed by examining the age of existing structures in an area. As noted in the “Summary of Age Findings” subsection of this report, at least six of the nine existing structures in the Study Area are 35 years in age or older. Indeed, at least five existing structures were constructed prior to 1930. The presence of incompatible land use relationships, an inadequate street layout and tax parcels of inadequate size and shape to facilitate redevelopment also suggests an area that has not changed in step with time. Rather, these conditions reflect the needs of an industrial user that has moved away from the central cores of cities, leaving their original locations in states of obsolescence. This lack of use has led to prolonged vacancy declining/lagging equalized assessed value and disrepair which further contributes to barriers to reinvestment and arresting the continued onset of obsolescence.


V. SUMMARY

Relevant qualification findings as related to the designation of the Study Area as a conservation area are as follows:

1. The Study Area is contiguous and is greater than 1 ½ acres in size;

2. The Study Area qualifies as a conservation area as; i) 50% or more of the existing structures are 35 years in age or older; and, ii) at least three eligibility factors are present to a meaningful extent and are distributed throughout the area;

3. All property in the Study Area would substantially benefit by the proposed redevelopment project improvements;

4. The growth of EAV for all taxing districts overlaying the area, including the City, has been impaired by the factors found present in the Study Area; and,

5. The Study Area would not be subject to redevelopment without the investment of public funds, including property tax increment.

In the judgement of KMA, these findings provide the City with sufficient justification to consider designation of the Study Area as a TIF district.

APPENDIX A: Tax Parcels within Study Area

City of Rockford First Amendment Amerock TIF Amendment Area PIN List

11-22-484-004

11-22-485-003

11-22-485-004

11-22-486-001

11-22-486-003

11-22-487-001

11-22-488-001

11-22-489-001

11-22-489-002

11-22-501-001

11-22-504-006

11-22-504-007

11-22-504-008

11-23-355-005

11-23-355-006

11-23-355-007

11-23-357-005

11-23-357-006

11-27-210-001

11-27-226-001

11-27-226-010

11-27-227-001

11-27-229-013

11-27-229-014

11-27-230-019

11-27-505-013

11-27-505-014

APPENDIX B: Boundary Map of Study Area

Cedar Street

Chestnut Street

S Chu

rch St

reet

S Main

Stree

t

S Cou

rt Stre

et


TIF Boundary

Tax Parcels



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Documents

ORDINANCE NO. 2021- -O-