Business Incentives

The City of Moline participates in programs to assist existing businesses to expand and new businesses to locate within the City.

1) Tax Increment Financing (TIF)
Illinois statute provides for municipalities to designate areas TIF districts. These areas qualify for designation by suffering from such factors as blight, obsolescence, deterioration, inadequate utilities, deleterious land-use, declining land value, among others.

TIF districts are created to assist in the redevelopment of a particular area. A baseline for property taxes is developed. All taxing bodies still receive the same amount of property tax revenue as before the TIF district was designated. Also, no additional taxes are placed on properties in the TIF district. As improvements are made to a property its value increases. The difference between the increased value and the baseline is the increment. The increment is used by the local government to make public improvements to the project area. According to state statute, permissible uses of the increment include:

1. Costs of studies, surveys, plans, and other professional service costs and the implementation, marketing and administration of the TIF Plan and TIF Area;
2. Property assembly costs, including acquisition, demolition, site preparation and improvement, etc;
3. Costs of the rehabilitation, reconstruction, repair or remodeling of existing buildings;
4. Construction of public works and improvements;
5. Job training and retraining;
6. Financing costs, such as those associated with underwriting, as well as capitalized interest;
7. All or a portion of a taxing district’s capital costs resulting from (re)development within the TIF Area;
8. A certain percentage of increased costs incurred by school districts and library districts resulting from “TIF-assisted” residential development;
9. Relocation costs;
10. Payments in lieu of taxes;
11. Developer’s interest costs.

The funds for the public improvements can be made available either by issuing bonds at the beginning of the project or distributing the increment as it becomes available every year.

In order for a project to qualify for TIF financing, the developer has to prove that but for public assistance the project would not move forward. There must be a number of impediments that make the project impractical without public assistance. The City has developed a process to ensure that public monies requested are indeed necessary.

The City currently has five TIF districts:
TIF #1 (downtown Moline) was established in 1986. The property tax portion will expire in 2021. The sales tax portion will expire in 2013.
TIF #2 (One Moline Place) was established in 1998 and will expire in 2021.
TIF #3 (former Moline High School) was established in 2004 and will expire in 2027.
TIF #4 (Autumn Trails) was established in 2005 and will expire no later than 2028.
TIF #5 (Kone Centre) was established in 2009 and will expire in 2032.

2) Façade Improvement Program
In downtown Moline (TIF #1), the Façade Improvement Program assists property owners with renovating the exterior of buildings with the intention of emphasizing and highlighting the building’s historic character. A forgivable loan of up to $10,000 or 33% of the project, whichever is less, is available. Single family residences are not eligible. For an application and program description, please contact the Planning & Development Department at 309-797-0707.

3) Enterprise Zone
The City of Moline is a participant in the Illinois Quad City Enterprise Zone. Moline works in cooperation with East Moline, Milan, Silvis, and Rock Island County to expand the enterprise zone to assist projects using tax incentives. According to the application to expand enterprise zones, the intent of the program is to create and retain jobs, remove conditions that make it difficult for a project to move forward, and to improve opportunities for revitalization of neighborhood residential and commercial districts.

The following are examples from the state website of enterprise zone tax benefits:
1. Sales tax deduction – building materials are exempt from Illinois sales tax
2. Jobs tax credit – a $500 tax credit per eligible employee hired to work in a zone
3. Investment tax credit – a .5% credit for investments in qualified property
4. Manufacturing Machinery and Equipment Sales Tax Exemption – requires creation of 200 full-time equivalent jobs or the retention of 2,000 full-time jobs in Illinois.
5. Utility Tax Exemption – a five percent tax exemption on gas and electricity for businesses that create 200 full-time jobs or retain 1,000 full-time jobs
6. Corporate contribution deduction – corporations may make contributions to designated zone organizations for projects approved by DCEO and claim a deduction double the value of the contribution

For a more detailed explanation or for questions about enterprise zones, please contact the IL. Dept. of Commerce and Economic Opportunity at www.commerce.state.il.us/com/ez_zone.

4) Moline Downtown Commercial Historic District (Preservation Tax Credits)
The Moline Downtown Commercial Historic District covers the majority of the central business district and includes 113 buildings. The nationally-designated district allows property owners to qualify for preservation tax credits providing that the project adheres to the Secretary of Interior’s Standards for Rehabilitation. The tax credit can be worth up to 20% of the cost of rehabilitation.

5) Bi-State Revolving Loan Fund Program
The Bi-State Regional Commission administers this program of which Moline is a member. The program’s purpose is to provide the additional funding necessary to supplement funding from traditional lending institutions. It is meant to bridge the gap when a project cannot be financed completely by traditional sources. The program focuses on manufacturing, industrial, service industries and downtown retail activity. The borrower must provide 10% equity in the project and a minimum of one job must be created or retained per $7,500 loaned. Also, the project must not have started before applying for the loan. The reason is that the project could not have gone forward without the assistance. Additional information and an application can be found at www.bistateonline.org.

6) Moline Revolving Loan Fund Program
The City of Moline has a smaller version of Bi-State’s revolving loan fund. The City’s program’s sole focus is on business activity in Moline whereas Bi-State loans can be issued for activity in Rock Island and Scott counties. Both programs, however, use the same application. Moline’s program also has the same requirements and restrictions as the Bi-State program.

7) Community Services Block Grant Loan Program
The Community Services Block Grant (CSBG) Loan Program provides long-term fixed-rate financing to new or expanding small businesses that create jobs and employment opportunities for individuals with low incomes. The program links federal, state and private financing by using CSBG funds at low interest rates in combination with bank funds and equity. Funds may be used for machinery, equipment, inventory and working capital. Businesses that qualify for this program receive prepackaging consultation to determine the most appropriate approach to capitalization needs and assistance in all phases of the application process for the loan. For more information, contact Project NOW at (309) 793-6391

8) Community-Wide Brownfield Assessment Grant
The US EPA awarded $200,000 to the City of Moline for assessment of potential brownfield sites. The funding may cover the cost of phase I and phase II environmental site assessments.

The City will examine, on a case by case basis, each development project to determine which incentives, if any, are appropriate.

State Programs

1) Illinois Economic Development for a Growing Economy
It is designed to attract out of state companies to relocate within Illinois. It is tax credit based on the investment and number of jobs created.

2) Employer Training Investment Program
A grant that will reimburse companies for up to 50% of the cost of training their employees.

3) State Treasurer’s Economic Loan Program
For Illinois businesses, the Treasurer’s office will deposit $25,000 per full-time job created or retained at below market rates into the borrower’s financial institution. The institution will then lend the money at below prevailing interest rates to the borrower.

4) Economic Recovery Loan Program
For businesses that bring new jobs to Illinois, the Treasurer’s office will deposit $50,000 per new full-time job created at below market rates into the borrower’s financial institution. The institution will then lend the money at below prevailing interest rates to the borrower.


Download a copy of the Business Incentives.

 

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