95-102 Resolution No. 95-102
RESOLUTION
DETERMINING THAT CERTAIN REAL ESTATE LOCATED ALONG
WOODVIEW DRIVE IS APPROPRIATE FOR CLASS 6B
COOK COUNTY REAL PROPERTY ASSESSMENT CLASSIFICATION
WHEREAS, FYCO Photoengraving, Inc. , is the owner of
certain real estate located within the City of Elgin and
intends to seek Class 6b Cook County Real Property Assessment
Classification; and
WHEREAS, the property to be acquired is unimproved and
will be used for manufacturing purposes .
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF ELGIN, ILLINOIS, that it hereby finds and determines
that the 1 .47 acre of real property located along Woodview
Drive, Elgin, Cook County, Illinois, assigned Permanent Index
Number 06-18-400-068-0000 is appropriate for classification 6b
under the Cook County Real Property Assessment Classification
Ordinance.
BE IT FURTHER RESOLVED that the City Clerk be and is
hereby authorized and directed to furnish the Office of the
Cook County Assessor with a certified copy of this resolution.
sl Kevin Kelly
Kevin Kelly, Mayor
Presented: May 10, 1995
Adopted: May 10, 1995
Omnibus Vote: Yeas 7 Nays 0
Attest:
sl Dolonna Mecum
Dolonna Mecum, City Clerk
El in
Agenda Item No.
April 14, 1995
TO: Mayor and Members of the City Council
FROM: Richard B. Helwig, City Manager
SUBJECT: Cook County Class 6b Real Estate Tax Incentive
FYCO Photoengraving, Inc.
PURPOSE
To provide information regarding a request from FYCO Photoen-
graving, Inc. for approval from the City for participation in
the Cook County Class 6b Real Estate Tax Incentive Program.
BACKGROUND
In May of 1986, the Cook County Board of Commissioners ap-
proved an ordinance amending the Real Property Assessment
Classification Ordinance to provide for real estate tax incen-
tives for various types of nonresidential developments . The
amended ordinance provides for three separate incentive class-
es that apply to industrial and commercial developments .
These are: Class 6, which applies to industrial properties;
Class 7, which applies to commercial developments; and Class
8, which applies to both commercial and industrial properties
under limited conditions.
Since the adoption of the amended Cook County ordinance, the
City has processed a minimum of four (4) real estate tax
incentive requests under Class 6b of the ordinance. Among
other prerequisites, Class 6b requires the local municipality
to determine that development would not occur without the
incentive. The City has not processed real estate tax incen-
tive requests under any of the other provisions of the amend-
ed Cook County ordinance.
Basically, Class 6b is applicable• to any manufacturing facili-
ty which is newly-developed, substantially rehabilitated,
re-utilized following a prolonged vacancy, or located in a
State of Illinois Certified Enterprise Zone. Class 6b pro-
vides for a reduction of the Cook County real estate tax
assessment factor for industrial properties from thirty-six
percent (36%) to sixteen percent ( 16%) for eight years, 23%
for for the ninth year, and 30% for the tenth. Thereafter,
Mayor and Members of the City Council
April 14, 1995
Page 2
the assessed valuation is the full 36% of the fair market
value. The State equalization factor for Cook County contin-
ues to apply. The most recent State equalization factor for
Cook County is 2 . 1407 The factor for Kane County s 1.0588.
Since the equalization factor in Cook County is app y
two times that of Kane County, the 6b tax program brings the
amount of taxes paid by the Cook County business on to an
equal footing with those paid by Kane County businesses for a
period of eight years .
The City received a request for approval of a 6b tax ' incen-
tive for a 1 .47 acre location along Woodview Drive owned by
FYCO Photoengraving, Inc. In the course of City Council
consideration of 6b requests in the past, a number of ques-
tions were raised regarding real estate tax revenue for the
City and School District U-46 .
FYCO is planning on building a new 4 ,200 square foot facility
on this property. Construction is to commence this year with
the 6b. incentive in place. This facility will employ ten
full-time and two part-time employees. They currently have a
smaller facility at 290 Willard Avenue.
The property index number is 06-18-400-068-0000 and is zoned
commercial/industrial . The total 1993 taxes paid in 1994 for
the index number was $2,711 . 84 . Of that total tax amount,
$1,345 . 07 was allocated to School District U-46 , being 49 . 63%
of the total tax. In addition, $612 .87 or 22 .57% of the
total tax was allocated to the City of Elgin.
It is estimated that $200,000 dollars of improvements will be
placed on the property together with approximate land value
of $60,000. Assuming the fair market value was determined to
be $260,000 two scenarios for property tax revenues evolve.
Phase I : Without 6b Incentive
Equalized Assessed Valuation $ 169 ,543.44
Overall Tax Rate 8 .996/$100 EAV
Annual Taxes $ 15,252 . 13
Phase I : With 6b Incentives
Equalized Assessed Valuation $ 75,352.64
(years 1 - 8) 108,319 .42
(year 9)
(year 10) 141,286.20
Overall Tax Rate 8.996/$100 EAV
Annual Taxes 6,778 .72
(years 1 - 8) $
(year 9) 9,744.42
(year 10) 12,710. 11
Mayor and Members of the City Council
April 14, 1995
Page 3
PHASE I TEN YEAR IMPACT
Without 6b Incentive
Total Taxes $ 152,521. 30
With 6b Incentive
Years 1 - 8 $ 54,229 . 76
Year 9 9,744 . 33
Year 10 12 ,710 . 11
Total $ 76,684 .20
Current Taxes Paid Without Project
Total City of Elgin U-46 Others
Taxes (22 .6%) (49 . 6%) (27 . 8%)
Current $ 2,711 .84 $ 612 .87 $ 1,345 .07 $ 753.90
Phase I Impact on Various Taxing Bodies Over Ten Years :
Total City of Elgin U-46 Others
Taxes 22 .57% 49 .63% 27 .8%
W/O 6b $152 ,521 . 30 $ 34,424 . 06 $ 75,696 .32 $ 42,400 .92
With 6b $ 76, 684 . 20 $ 17 ,307 . 62 $ 38,058 . 37 $ 21,318.21
Variance $ 75,837 . 10 $ 17 , 116 .44 $ 37 ,637 .95 $ 21,082 .71
FYCO is requesting that an ordinance be passed approving the
6b classification and expressly stating. that the City of
Elgin supports and consents to the class 6b application and
that it finds class 6b necessary for development to occur on
the above property.
COMMUNITY GROUPS/INTERESTED PERSONS CONTACTED
This matter will be reviewed with School District U-46 and
their comments will be obtained.
FINANCIAL IMPACT
If the project does not proceed, property taxes over a ten
year period will total $27, 118.40. If the project does pro-
ceed and the 6b incentive is granted, property taxes over the
ten year period will total $76,684 .20 . If the project pro-
ceeds and the 6b incentive is not granted, property taxes
over the ten. year period will total $152,521.30.
Mayor and Members of the City Council
April 14 , 1995
Page .4
LEGAL IMPACT
None.
RECO MME riDAT I ON
The 1 .47 acres of property located along Woodview in Elgin is
currently undeveloped. FYCO has operated in Elgin at 290
Willard Avenue for 22 years . The firm is considering of
expansion of its business within the Cook County p
the City of Elgin and the boundaries of School District
U-46 . In order to equalize the amount of property taxes paid
by the company between Kane and Cook County, staff recommends
support for the 6(b) incentive program request.
Respectfully submitted,
Raymond H. Moller
Director of Business
Services and Properties
Richard B. Helwig
City Manager
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