Meeting held on proposed special service area
by BRIAN NADIG
While residents at a May 14 community meeting did not dispute the merits of a proposed taxing body to help revitalize the Jefferson Park commercial district, several questioned why residential property owners would be required to pay the tax.
Creation of a special service area, a local taxing body that is typically used to improve commercial districts, is being considered for Jefferson Park. State law requires the boundaries of a special service area to be contiguous, but not all municipalities interpret that requirement the same. In Evanston, condominiums that are located above storefronts can be left out of a service area, but in Chicago, all residential and commercial properties in the affected area are subject to the property tax.
City Department of Planning and Development assistant commissioner Mark Roschen said that the policy of not excluding any parcel has been reviewed by city’s legal staff and is "based on case law." In Evanston, the exemption does not apply to all residential properties.
The Jefferson Park Chamber of Commerce is proposing creation of a service area that would raise at least $200,000 annually for improvements in the area, including the recruitment of new businesses. Mayor Rahm Emanuel would appoint a commission of local property owners who would set a budget and tax rate each year for the special service area, and the chamber would be the administer for the service area.
Most of the funds would come from commercial properties, even though 501 of the 747 properties in the affected are residential. The area primarily covers Milwaukee Avenue between Montrose Avenue and the Kennedy Expressway and Lawrence Avenue between Austin Avenue and the expressway.
The average condominium owner would pay about $162 a year in taxes to the special service area and the average single-family home owner would pay about $300, while commercial property owners would pay an average of about $1,100, according to Noah Gordon of PLACE Consulting, which the chamber hired to assist with its application to the city. Most of the residential properties in the special service area would be condominiums and apartment buildings, but there would be five single-family homes, Gordon said.
The Jefferson Park Neighborhood Association has approved a resolution calling for any residential property owner to have the option of being exempted from the special service area.
Association board member Ron Ernst said that the tax places an unfair burden on home owners fixed incomes and that the proposal should be rejected unless an accommodation can be made for owners of residential properties. Ernst said that the chamber should lobby the city to change its policy on special service areas.
When the city formed the Jefferson Park Tax Increment Financing District in 1998, some residential properties were removed from the TIF district area after residents objected, and there is no reason why the city cannot make the accommodation for service areas, Ernst said. TIF districts are primarily designed to fund large infrastructure improvements, while special service area provide beautification and marketing services to an area.
A condominium owner said at the meeting that she would like to know what services the chamber would provide for her building so that her condominium association could stop charging members for those services as part of their monthly dues. Special service areas sometimes are used to clean and shovel sidewalks.
Chamber president Lionel Rabb said that the he wishes that there were an option to exclude residential properties and that some of the residential units are included in the service area because the chamber wanted to include the Lawrence-Austin commercial district in the special service area in order to provide better services to merchants there. There are many apartment and condominium buildings on Lawrence separating the Jefferson Park’s core commercial area at Milwaukee and Lawrence avenues from the Lawrence-Austin area.
Rabb said that the special service area would give the chamber the tools it needs to improve the commercial area and that the values of both commercial and residential properties would increase as improvements are done. He said that some stores in the area do a poor job of maintaining their properties and that the funds which their landlords contribute to the special service area could be used to clean up those areas.
Chamber member Larry Fisher of Heatmasters, 5540 W. Lawrence Ave., said that the special service area would help return the commercial district to the vibrant area that it once was.
Chamber executive director Amie Zander said that residents contact her about the need for better landscaping in the commercial district but that without the special service area, the chamber could not properly maintain planter boxes and other decorative elements.
Alderman John Arena (45th) said that the 10-year-old special service area in the Six Corners commercial district has played an integral part in the revitalization of the area and that Jefferson Park has the potential for greater success because of the presence of the CTA bus and rail station.
Arena said that special service areas can be successful in large part because spending decisions are made by a local commission instead of by City Hall.
Special service area taxes are collected as part of the property tax bill which property owners receive from the county twice a year. The first Jefferson Park tax would be collected in the fall of 2016, Kimberly Bares, president of PLACE Consulting, said.
No commercial property owners spoke against the proposal at the May 14 meeting. The chamber will hold a second community meeting on the proposal at 6:30 p.m. Thursday, May 21, at the Copernicus Center, 5216 W. Lawrence Ave.
