TIF Districts

The City of Mt. Vernon currently has four active Tax Increment Financing (TIF) Districts:

Downtown TIF, East Side TIF, West Side TIF, and North 44th Street (Frontage Rd) TIF. 

The City utilizes TIF financing to provide incentives through development or redevelopment agreements, evaluated on a project-by-project basis.

What is Tax Increment Financing (TIF)?

Tax Increment Financing (TIF) is an economic development tool that helps local governments improve historic districts, restore underdeveloped or blighted areas, and encourage investment in economically challenged neighborhoods.

TIF funds may be used to make public improvements—such as new roads, sewers, and utilities—or to provide incentives that attract new development and businesses. This tool helps overcome costs that can otherwise prevent redevelopment projects from moving forward.

How Do TIFs Work?

When a TIF district is created, the property value within its boundaries is established as the “base” equalized assessed valuation (EAV). Property taxes on this base amount continue to go to the local taxing bodies (schools, libraries, etc.), all of which are part of the TIF approval process.

As redevelopment occurs, property values increase. The additional tax revenue—known as the increment—is collected into a special fund managed by the City. These funds are reinvested into the district to encourage further development, creating a cycle of reinvestment and growth.

How Long Does a TIF District Last?

Under Illinois law, a TIF district may exist for up to 23 years, with the potential for a 13-year extension if certain conditions are met. After the TIF expires, all properties return to the regular tax rolls, and taxing bodies begin receiving revenues based on the updated property values.

To learn more, visit the Illinois Tax Increment Association. 

Eligible Projects and Uses of TIF Funds

TIF funds may be used to support projects within the district that promote development or redevelopment, including:

• Redevelopment of vacant or underutilized buildings
• Public infrastructure improvements (streets, water, sewer, utilities)
• Environmental cleanup and site preparation
• Downtown revitalization and historic preservation
• Construction of new public works or facilities
• Job training and workforce development
• Marketing and professional planning services

Additional eligible uses are outlined in the Illinois Tax Increment Allocation Redevelopment Act (the “TIF Act”).

How Can TIF Funds Be Used?

The uses of TIF funds are provided in the Illinois Tax Increment Allocation Redevelopment Act, also know as the TIF Act. The Illinois TIF Act generally authorizes that TIF funds may be used for:

• Acquiring property
• Administration of a TIF redevelopment project
• Rehabilitation or renovation of existing public or private buildings
• Construction of public works or improvements
• Relocation
• Job training
• Financing costs, including interest assistance
• Marketing sites within the TIF District
• Studies, surveys and plans
• Professional services, such as architectural, engineering, legal and financial planning
• Demolition and site preparation

Some restrictions may apply, please review the TIF Act for a full list of TIF eligible costs. 

42nd Street Tax Increment Financing (TIF) District – Proposed

At the December 15 City Council meeting, the Mt. Vernon City Council approved a resolution calling for a public hearing on the proposed 42nd Street Tax Increment Financing (TIF) District and the associated Redevelopment Plan and Project.

The public hearing will be held on February 2 at 6:30 p.m., prior to the regular City Council meeting. The purpose of the hearing is to present information regarding the proposed TIF district, receive public comment, and consider the Redevelopment Plan and Project in accordance with state statute.

The proposed 42nd Street TIF District is being evaluated as a redevelopment area to address conditions that may hinder private investment and to support future infrastructure improvements and economic development within the district.

View the Proposed Redevelopment Plan 

Additional notices, documents, and updates related to the proposed TIF District will be posted on this page as the process continues.