Dixon mayor: TIF districts to help spur economic development, future flooding fixes

By Rachel Rodgers, Shaw Local

The main driver for creating two tax increment financing districts across 855 acres in Dixon is to prime land for new development, but they could also help with alleviating flooding issues.

The Dixon City Council held public hearings Tuesday on the proposed Industrial Park and Fargo Creek TIF districts, and a few residents spoke about concerns with flooding in the Fargo Creek floodplain.

TIF districts were created as a tool for towns to use to help redevelop run-down, blighted areas or jump start economically sluggish parts of town.

Property taxes created from new developments in TIF districts are used to go back into that area. For example, a city could make road and infrastructure improvements to accommodate a development and then pay itself back over time through taxes paid by that development.

“It would allow us to capture new revenue coming in from new businesses and have them pay for themselves,” Mayor Li Arellano Jr. said.

The Fargo Creek plan would include 619 acres, 432 of which are vacant, 126 are developed and 61 are right-of-ways. The boundaries roughly would cover First Street to the north, Peoria and Chicago avenues to the east, I-88 to the south, and Depot Avenue and Pump Factory Road to the west. The plan calls for $106 million in developments using the Fargo Creek TIF money across the next 23 years.

It includes the western tributary of Fargo Creek, which has caused flooding issues for years, such as when a portion of Seventh Street collapsed in 2015.

Marilyn Jackson said she lives on Highland Ave. off Fifth Street, and the Seventh Street collapse and flooding did a lot of damage to their backyard.

She and others asked the council how the TIF district could improve conditions in the area for residents, and if the new developments would create excess runoff.

A retention or detention pond to offset flooding would likely cost more than $1 million, and the city is actively looking at grant opportunities to fund it, Arellano said, adding that revenue from the TIF could help pay for the local match portion of a grant for the work.

In addition to economic development, “Fargo Creek and flooding are very much a target of this,” he said.

One of the development projects spurring the need for TIFs is the Gateway Project that will bring new developments to 27 acres across from Walmart in the Interstate-88 corridor including a hotel, gas station, restaurant and shops.

Arellano said the project is under strict requirements to meet state and local runoff standards, and there’s a parcel set aside to address that.

The Gateway Project will likely take about $4 million in infrastructure improvements from the city.

An area across from Walmart on south Galena Avenue will become part of Fargo Creek plan. (Alex T. Paschal/apaschal@shawmedia.com/credit)

It would be at least a couple of years before a pond would be built to alleviate Fargo Creek flooding, and it depends on the city receiving grant funds. Hopefully, the city will have it completed within 5 years, City Manager Danny Langloss said.

The Industrial Park TIF would cover 236 acres, of which 155 are vacant, 78 are developed and three are right-of-ways. It’s located south of I-88, between South Galena Avenue and U.S. Route 52. The goal would be to invest $32.5 million into that district in the next 23 years for improvements that would attract new development.

The public hearings were the latest steps to get the TIFs finalized in the upcoming months.

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