SHELBYVILLE - More than 50 people crowded into the Shelbyville City Council chambers Monday night for a public hearing about a proposed tax increment financing district in Shelbyville.

Consultant Gene Norbert said the TIF district, which would encompass most of downtown Shelbyville along with north Illinois 128 and the Shelbyville School District campuses, would use property tax revenue generated in the district to improve buildings and do other projects to enhance business growth and development within the district. Also included is property owned by Shelbyville's largest employer, International Paper.

Norbert said the TIF district could generate as much as $17 million over its lifetime for redevelopment.

"The program works," Norbert said. "The EAV (Equalized Assessed Valuation) will grow through improvements to the business area."

Some at the meeting were concerned about the loss of revenue for other taxing bodies because TIF rates stay the same for the length of the agreement - in Shelbyville's case, 23 years.

Shelbyville Superintendent Robert Verdun asked if the district wanted to sell its Main Street School property to a private developer would TIF funds be available to tear the building down.

"It is permissible to use TIF funds if you come to agreement with the city," Norbert said.

Verdun said school districts would be hurt the most by a loss of revenue through the TIF district.

"Outside the city residents will also be hurt by this," Verdun said. "They'll be paying more than their share of bonds for the school district."

Verdun also questioned why Shelbyville had reduced its operational taxes on tax bills mailed last month.

"If the city does not have the money to do the things it is constitutionally mandated to do, why reduce the tax?" he said. "The TIF is a 732 percent increase for the city in revenue, and a commensurate decrease for other taxing bodies."

City Attorney John Freeman told the group that a TIF Review Board, comprised of representatives of taxing bodies affected and public member Brad Jiter would hold public meetings to discuss spending TIF funds.

"It's a true bootstrapping type of affair," Freeman said of TIF, "Whatever improvements that might be contemplated might not have been made otherwise without the TIF."

Some business owners wanted to know how the TIF would benefit them.

"What is TIF going to do with my tax dollars to get people downtown?" Thomas Niksic, owner of Shelby County Shirt Co., said.

Antique dealers Pat Eversole and Norma Hubbartt, who rent their downtown buildings, encouraged the council to approve the TIF.

"When people come into town this is their first impression of our community," Eversole said. "We want it to be something we can be proud of."

"Do we want to hand the city over to the next generation like it is now?" Hubbartt asked. "I don't think so."

The council is expected to take a final vote on the TIF district next month.

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