Development Incentives & Assistance
The following are major business development incentives for the City of Pekin, which will require further discussion, analysis and negotiation with the City. To find out how to access these incentives, contact the City's economic development manager, Matt Fick, at mfick@ci.pekin.il.us or 309-478-5355.
Notice of TIF/BDD Funding Opportunity
Notice of Funding Opportunity: FY 2023-2024 Tax Increment Financing (TIF) and Business Development District (BDD) Grants.
Summary: The City of Pekin’s Economic Development department will be accepting proposals to fund eligible projects located within one of the City’s existing Tax Increment Financing Districts or its Business Development District within the City of Pekin. Applicants must own the property for which they are applying for funding or have the written consent of the property owner.
Dates: All proposals must be submitted between 5:00 pm CST on April 26, 2023 to the attention of Bruce Marston, Interim City Manager.
Eligible Activities:
TIF eligible activities include:
- Costs of studies, surveys, development of plans and specifications, implementation and administration of the redevelopment plan. For example, professional service costs: architectural, engineering, legal, financial, planning; and administrative costs related to implementation of the redevelopment plan. (Private & Public)
- Cost of marketing sites. (Private & Public)
- Property assembly costs. For example, acquisition of land and other property, real or personal, or rights or interests therein; demolition of buildings; and site preparation. (Private & Public)
- Costs of rehabilitation, reconstruction or repair or remodeling of existing public or private buildings. (Private & Public)
- Costs of construction of public works or improvements. For example, streets, sidewalks, water, sanitary and storm sewer, etc.; and new public buildings (with some limitations). (Private & Public)
- Costs of eliminating or removing contaminants and other impediments such as site improvements that serve as an engineered barrier addressing ground level or below ground environmental contamination, including parking lots and other concrete or asphalt barriers; and the clearing/grading of land. (Private & Public)
- Costs of job training and retraining projects. (Private & Public)
- Financing costs – up to 30% of interest expense. (Private & Public)
- Obligations secured by the special tax allocation fund... may be issued to provide for redevelopment costs. (Public)
- Approved Capital Costs of taxing districts. For example, all or a portion of a taxing district’s capital costs resulting from the redevelopment project necessarily incurred or to be incurred within a taxing district (including the municipality) in furtherance of the objectives of the redevelopment plan and project when approved by the municipality. (Public)
- Relocation costs. (Private & Public)
- Payment in lieu of taxes. (Public)
- Up to 50% of cost of construction of low income and very low-income new housing, owner occupied or rental. (Private)
*BDD eligible activities include all of the aforementioned items but also allows for new vertical construction.
Performance Details: This is a competitive grant application program and a minimum 50% match is required. Applications not providing at least a 50% match will not be considered and those providing more than a 50% match will score higher in that particular category. All projects funded by the City must be completed within one year of their grant approval date, although applicants may request a time extension under certain circumstance with City Council approval. Grant recipients must pay for eligible items up front before seeking reimbursement from the City.
Award Size: Funding commitments will be made between $10,000 and $30,000 per grant award until budgeted funds have been obligated.
Application Criteria: The criteria being used to determine which proposals are recommended for the award of grant funds include:
- Does the project address blighted conditions
- What percentage of the project is being funded by the City
- Does the project generate new sales tax for the City
- Does the project generate new jobs
- Does funding the project help create a new business
- Does funding the project bring benefits to local residents
- Does funding the project help draw people to town (i.e. promote tourism)
- Does the applicant have a proven track record in business or real estate development
While the City will utilize these criteria to determine the highest-ranking proposals, the City retains sole discretion in the selection and provisioning of grant awards.
Contact Information: For further information concerning this notice, please contact the City’s Interim City Manager, Bruce Marston, at bqmarston@ci.pekin.il.us, or by calling (309) 478-5371.
Required Attachments: All applicants will be required to provide the following information:
- TIF Developer Application
- Project narrative including detailed project description, site plan, renderings (if available) and a breakdown of funding sources and uses
- Proof of financing for applicants’ portion of the project.
Application Milestones and Submittal Process:
- All applications must be received by 5:00 pm on April 26, 2023
- Applications will be scored and reviewed by the Economic Development Advisory Committee (EDAC) on May 1, 2023, and recommendations for awards forwarded to the Pekin City Council.
- It is anticipated that awards will be made by the Pekin City Council on May 22, 2023 at the regularly scheduled Council meeting.
- Applications can be downloaded here.
- GIS Map can be viewed here.
- Applications may be emailed to bqmarston@ci.pekin.il.us, or mailed/dropped off to the attention of Bruce Marston at 111 S. Capitol Street, Pekin, IL 61554
TAX INCREMENT FINANCE DISTRICTS
- Rehabilitating, reconstructing, remodeling of existing structures;
- Costs of construction of public infrastructure improvements;
- Architectural, engineering, legal, financial services; and
- Property assembly costs such as acquisition, demolition, clearing and grading.
The following is a link to a redevelopment plan outlining the goals of the City with this TIF: TIF District Redevelopment Plan
BUSINESS DEVELOPMENT DISTRICT
The City of Pekin has created a Business Development District (BDD) primarily located along major commercial corridors of the City. A BDD is a geographical area designated by the City to focus public and private investment in the community. The geographical area of the BDD includes Court Street, Derby Street, Broadway, North 8th, and the city's downtown area. The BDD in Pekin will help to tackle some of the city’s biggest challenges, including a lack of investment in infrastructure (streets, sidewalks, sewers) and development (new businesses and job creation). Reinvestments in these key focus areas will be possible due to funds generated through a 1% increase in sales tax for retail sales located in the BDD.
To lessen the BDD’s 1% sales tax impact on Pekin residents, the City Council also voted to lower the City’s portion of the property tax by over 10% in the 2020 levy, for taxes paid in 2021. These savings substantially reduce the impact of the BDD sales tax to near break-even levels in the first year and substantially lower it in the following years. The BDD also allow the City to shift more of the burden for infrastructure maintenance and repair to external users/shoppers of our city. Lastly, the BDD creates a dedicated funding stream for annual infrastructure improvements and business development that will help keep Pekin improving and growing.
The 1% BDD sales tax will go into effect on July 1, 2021. Sales tax revenues from the BDD will start to come to the City in September 2021. As funds accumulate with the City, businesses can apply to receive assistance for qualified projects that result in positive economic impact for the community (new or retained jobs, increased tax base, revitalization of historic or older buildings, etc.).