County: State clarification on enterprise zone:
No cherry-picking who gets property tax relief

[February 17, 2012]  The answer to a lingering big question about the Lincoln-Logan County Enterprise Zone and its taxing districts has been found. The question: Can participating taxing districts choose options outside the locally defined program?

Last year, Lincoln Community High School administrators forecast serious financial difficulties looming in a couple of years. Superintendent Robert Bagby proactively began a hard look at cost-cutting measures and potential revenues.

While Bagby was supportive of efforts toward economic growth, he postulated whether the high school could set up a different property tax relief scale than what is written into the local program or choose participation on a case by case.

The enterprise zone is a state of Illinois program. Each territory in the program established its own criteria in its setup phase.

The Lincoln-Logan County Enterprise Zone participants are eligible for 100 percent property tax abatement on property improvements the first five years, 50 percent abatement in the next five years and then begin paying 100 percent of the improved property value.

This month the enterprise zone administrator, Will D'Andrea, backed up his previously delivered opinion with information from the state of Illinois. (See memorandum below.)

During the executive and economic development committee meeting, chairman David Hepler explained: "Essentially, enterprise zone participating bodies can't cherry-pick project to project."

Hepler observed that the high school district won a referendum that would provide some funding relief for them.

He also considered whether it would be a good process to ask the new development partnership director, Michael Maniscalco, to work with the taxing districts on what is desired at this point because "they're either in at a level or they're out."

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Memorandum from Will D'Andrea, enterprise zone administrator

(Copy)

Subject: Enterprise Zone Property Tax Abatement

Property tax abatement is one of several benefits available to eligible uses / businesses located within an Enterprise Zone. Each Zone designates which uses / businesses shall be eligible for those benefits.

A taxing authority can agree to participate or not participate in an Enterprise Zone. If a taxing authority has agreed to participate in the zone, the abatement associated with that taxing authority is available to all the eligible uses / businesses in the zone.

Given the intent and purpose of the Enterprise Zone, the language of the Zone would not allow a single taxing authority to pick and choose which uses / businesses would be eligible for abatement from that taxing authority.

In other words, a taxing authority cannot choose to participate in the Enterprise Zone on a case-by-case basis. It can either choose to participate fully (abatement applies to all designated eligible uses / businesses) or not participate at all.

If a taxing authority, that was not a participating member of the zone, were to desire to abate property taxes for a particular property or use / business it would be attempting to do so outside the authority of the Enterprise Zone. That taxing authority would need to have established statutory authority to abate taxes in that manner.

Apparently this type of question is asked often enough that the Illinois Enterprise Zone Association website addresses this issue on their Frequently Asked Questions page and is as follows:

FAQ Overview

Are tax incentives and other benefits offered on a case-by-case basis?

No. "Case-by-Case" is contrary to the intent of the Enterprise Zone Act. Tax incentives must be offered uniformly and equitably by class. The local ordinance authorizing tax incentives, such as property tax abatement, extends the incentives automatically through eligibility criteria, such as class of property (i.e., residential, commercial and industrial) and formulas (i.e., percentages and number of years available).

--End note by D'Andrea

You can see enterprise zone territories and extensions on Logan County's GIS. You will also find zoning and other optional layers there. Go to the county's website, http://www.co.logan.il.us/.  Click on "GIS" on the navigation bar at the side, and then under "Welcome," click on the words "Internet Mapping." Or go direct from this link: http://www.centralilmaps.com/LoganGIS/.

[By JAN YOUNGQUIST]

For more information:

Lincoln/Logan County Enterprise Zone
Incentives for Capital Improvements

Logan County Zoning Office
529 S. McLean St.
Lincoln, IL 62656

Zoning officer: Will D'Andrea

Phone: [phone]

Email: [e-mail]

Lincoln & Logan County Development Partnership
1555 Fifth St.
Lincoln, IL. 62656

Executive director: Mike Maniscalco

Phone: [phone]

Website: http://lincolnlogan.com/

Email:

General questions: [e-mail]
Executive director: [e-mail] 

Past related articles

• County: Discussion of school request to opt out of enterprise zone, but offer property tax incentives case-by-case

• LCHS talks to community: Administrators explain why cuts need to be made, solicit input

• City Briefs: D'Andrea and Hamilton address enterprise zone issues

• D'Andrea explains enterprise zone dilemma to the city

• County: Enterprise zone
  (section in second column of article)

• Lincoln-Logan Enterprise Zone extension helps Sangamon County