ACTION REQUESTED:
Title
Communication from the City Manager with a Request for a POLICY SESSION on the Creation of a City Policy on the Use of SALES TAX INCENTIVES in SPECIAL SERVICE AREAS.
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BACKGROUND:
Basics of Special Service Areas
A Special Service Area (SSA) is mechanism provided for in Illinois state law , 35 ILCS 200/27, that creates a financing vehicle for development activities within a defined geographic area. SSAs allow a City to levy additional taxes in a targeted manner rather than increasing taxes on the entire municipality. While SSAs have traditionally been built upon additional property tax levies, their use has expanded to other forms of taxation such as sales and hotel taxes. The use of funds generated by SSAs is broad and can cover municipal services such as additional street sweeping or landscaping, private services such as branding and marketing, and infrastructure development.
The process to create an SSA is relatively simple. There are a few key steps:
1. A request is made of the City to create an SSA.
2. The City Council is asked to adopt an ordinance proposing the SSA and setting a date for a public hearing.
3. No sooner than 60 days from the date of that initial ordinance, a public hearing is held.
4. After the public hearing, there is a 60 day "objection period" during which opponents can stop the implementation of an SSA by obtaining and delivering a petition bearing the signatures of at least 51% of the property owners AND 51% of the registered voters within the proposed area. This provision can be waived if the entity requesting the SSA can certify that there are no registered voters or disagreeing property owners in the area. This usually happens in commercial areas where all property owners (often just one owner alone) is behind the request.
A successful opposition petition forces defeat of the proposed SSA and it cannot be reintroduced for two years. However, the City Council is not obligated to approve an SS...
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