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updated: 6/25/2018 1:20 PM

Huntley considers creating business district, new sales tax

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  • Demolition of the Huntley Outlet Center has been completed and the owners are working to get the property rezoned. The village also is considering creating a business district for that area to spur redevelopment.

    Demolition of the Huntley Outlet Center has been completed and the owners are working to get the property rezoned. The village also is considering creating a business district for that area to spur redevelopment.
    Brian Hill | Staff Photographer

 
 

Huntley village officials are considering establishing a business district and a special sales tax for an area along the Route 47/Interstate 90 corridor encompassing a mix of commercial uses.

A business district, officials said, could help with redevelopment of the recently demolished Huntley Outlet Center, the Huntley Auto Mall and nearby undeveloped or vacant properties north of Freeman Road along Route 47. New sales tax revenues generated from businesses in the area could fund redevelopment incentives for the corridor and other private and public improvements, including construction, relocation, infrastructure, renovations, site studies and preparation costs.

The village board recently hired Kane, McKenna and Associates to prepare a business district plan for a cost of between $8,500 and $12,500. The firm had worked with the village to establish the downtown tax increment financing district and other projects.

Consultants will help further define the area qualifying a business district designation under state law, said Lisa Armour, assistant village manager.

Unlike a special taxing district, a business district would not affect the property tax base or other taxing bodies, Armour said.

State law allows municipalities to establish a business district and impose an up to 1 percent sales tax within that area to fund development provided the plan meets state requirements.

In December 2017 the village adopted the I-90/Route 47 Gateway Plan to ensure long-term vitality surrounding the interchange and the entire village. This area is key to implementing the village's overall strategic plan and the more specific economic development plan emphasizing new business attraction and expansion, redevelopment of the former outlet center and reuse of vacant properties, documents show.

Among the state's criteria for a business district are properties within must border each other and be blighted as defined by state code. The district sales tax would be imposed on general merchandise sold at retail or transferred as part of a sale of service. The tax would not apply to certain food, drugs and medical appliances, or vehicles that must be titled or registered by the state.

The village could impose the sales tax in 0.25 percent increments up to the 1 percent limit for a duration of up to 23 years. A 1 percent hotel tax also could be added to the current rate of 5 percent, documents show.

Among the objectives of the village's strategic plan is securing a commitment for construction of a hotel, working with the owners of the former Chevrolet dealership at the Auto Mall and the vacant restaurant building on Freeman Road to redevelop or fill those buildings.

With demolition of the outlet mall complete, property owners are working on rezoning the site and marketing it for retail and light industrial uses. That application will go before the village board in the coming months, Armour said.