Business Incentives

Tax Increment Financing Districts

TIF #1: Designation: March 2002 Expiration: 2034 (Restructured in 2014 into TIF #1 and TIF #2)

The approximately 70-acre area of the Lake Zurich TIF District is intended to facilitate the preparation of vacant and underutilized sites. The sites will be used for new retail, commercial, and residential development, and off-street parking. The TIF is located within the downtown redevelopment area of the Village. The TIF District is also designed to re-establish the downtown as a vibrant, mixed-use area. It will strengthen the economic well-being and quality of life in the downtown by providing resources for redevelopment. Additionally, it provides resources for additional parking, streetscaping and landscaping to create a distinct area and to link its diverse land uses. The TIF also facilitates the improvement and expansion of existing public facilities, such as parks and parking.

Growth in Equalized Assessed Value

Equalized Assessed Valuation (EAV)
Base EAV (2002) $12.6 million

2021 TIF Update

Village Manager Keller presents overview of the downtown TIF district during virtual board meeting of 2/1/21 outlining past administration's reasoning for establishing the district with concept plans that date back to 1998. With redevelopment stalled during the great recession in 2008, the Village restructured the original TIF in 2014 to ensure that debt payments aligned with the tax increment received.  The restructuring lowered interest and reduced annual payments to make make the TIF district self-sustaining, removing pressure from the general fund and Lake Zurich tax payers.

Slide deck presented during the update

TIF 1 and 2

If I see it on the Internet ... 

... it must be true!

There is has been much chatter about Lake Zurich's TIF districts, development and TIF debt on social media. The information included in posts or comments range from up-to-date facts to pure conjecture and everything in between. Therefore, we are posting this fact check tool of the Lake Zurich TIF Experience as presented by Village Manager Keller in 2021:

TIF Revenue vs Debt Service

Taking a look back

  • The downtown TIF was established in 2002, with $30M in debt issued over the next 3 years to fund property acquisition and cover development costs for the downtown concept.
  • Some redevelopment projects were successful, namely Concorde Village and a partial development of Somerset homes. Other projects from McCaffrey and ESG/Smith collapsed with the 2008 recession.
  • The Route 22 bypass of downtown improved traffic flow, but left downtown Main Street with less visibility and investors focused on heavy traffic areas such as Route 12.
  • Holding $30M in debt and several properties, increasing debt payments exceeded the TIF increment in 2014. Restructuring the TIF in the same year to protect the Village's operating funds from covering TIF repayments resulted in TIF #1 and TIF #2.  In short, the increment derived from the TIF will be covering the debt payments.

2021 and beyond

  • There is light at the end of the tunnel with TIF debt decreasing with $7.83M already repaid in 2020. Future repayment dates are 2024, 2029 and the last repayment in 2034. 
  • Future revenue and debt repayments are not dependent on a specific new project.
  • Several Village owned properties have been sold, returned to the property tax roles and are adding TIF increment.
  • TIF investments support private investments and will generate additional TIF increment.