Plans for Mel Foster's proposed Maple Leaf Heights subdivision has found new life thanks to support from local taxing bodies.
Mel Foster owns land north of Geneseo between Route 82 and Chicago Street/Grange Road.
In 2009, the company planned to develop the site as a subdivision featuring approximately 235 lots. However, Illinois Department of Transportation officials required a turn lane to be constructed off Route 82 into the proposed subdivision.
Finding funding for the turn lane became the issue that derailed the project.
Originally, the city was asked to issue a bond for up to $520,000 to fund the turn lane. At the time, Mel Foster Co., planned to repay the city $2,000 from every lot sold. The total repayment would have been $456,000 with the city responsible for paying the interest on the bond.
City officials put the issue to the voters, who opposed the bond with a 1,237 to 669 vote on Feb. 2, 2010.
"The citizens spoke when they said 'No' to the referendum," said Geneseo mayor Linda Van Der Leest. "After that, we said, 'Let's brainstorm and see what other options there are out there.'"
The solution is a property tax abatement agreement between eight local taxing bodies.
Central Bank of Geneseo will loan the $600,000 now needed for the turn lane to Mel Foster Co.
In turn, each taxing district will refund 100 percent of the property taxes for each new home built in Maple Leaf Heights during the development's first 10 years.
The taxing districts will abate property taxes for seven years-per home.
The eight taxing districts include the city, Geneseo School District, Geneseo Fire District, Geneseo Township, Hammond-Henry Hospital District, Geneseo Public Library District the Geneseo Park District and the road district.
The taxing bodies will pay property tax abatements for the Maple Leaf Heights homes directly to Central Bank, and not to Mel Foster.
City officials worked closely with school officials to create the proposal. The school district is the taxing body which receives the largest percentage of property tax funds.
Though each taxing body will need to officially approve the deal, Geneseo city administrator Jim Hughes said verbal commitments have been received from all taxing bodies involved.
"They're all pro-Geneseo, and there's a definite community effort in this. I can't thank them enough for their cooperation," said Hughes.
"I think they recognized the importance of growth and development in the community, not only for businesses, but also for the school district. Without student enrollment and without growth, a community stagnates," said Rob Fick, president and CEO of Mel Foster Co.
The first phase of Maple Leaf Heights will involve 40 to 45 lots, said Fred Dasso, office branch manager for the Geneseo Mel Foster office.
Page 2 of 3 - "That is a rather large phase. Normally we do phases of about 25 homes at a time," he explained.
Homes built in Maple Leaf Heights are expected to be in the $225,000 to $275,000 range.
If three homes a year (valued at $250,000) are built, the turn lane will be paid for with property tax abatement funds in roughly nine years, said Hughes. If six similarly valued houses are built a year, the loan will be paid in five years.
"Obviously we hope to build more homes (per year)," said Fick. "But we wanted to try and look at worst-case scenarios."
Under the proposed agreement:
• The first year of the loan may not have accrued any increment. The city would pay 50 percent of the interest for the turn lane loan only.
"In a worst case scenario at 5.0 percent interest, this would cost the city $15,000," said Hughes.
• If the increment is not sufficient to pay the annual principal and interest on the turn lane, the city would be liable for an amount not to exceed 50 percent of the cost of the turn lane only. If no houses are built, then the maximum amount of out-of-city funds would be $300,000
"This will give our community the opportunity to welcome new families. It also will give community residents the chance to build in a new subdivision," said Van Der Leest.
She added the proposed new subdivision — along with existing subdivisions including Prairie View, Double S and Maple Bluff — will provide opportunities for growth in the city.
"If people don't want to build in a larger subdivision, we have smaller subdivisions that are attractive," she said. "It's about providing good options for people."
Van Der Leest also credited the other taxing bodies for their willingness to work with the city on the tax abatement issue.
"It's just another testimony to the partnership that people have in this city. It's all about presenting a climate of growth and wanting to build for our future," she said.
Plans for Maple Leaf Heights have been in the works for nearly a decade.
"As far as getting something started, this is probably the project that I've worked on the longest, and I've been involved in this business for 35 years," said Fick, who called the property tax abatement proposal "great news" for the project.
"This has meant everything to the project. It was critical for us to get to a point where we could move forward," he explained.
Though Mel Foster Co. has preliminary turn lane approvals from the state, the next step will be to finalize approvals.
"We'll also need to get bids from our contractors and finalize bank agreements. There's still a lot of paperwork to do," he said.
Page 3 of 3 - Still, Fick said he anticipates construction at Maple Leaf Heights could begin "sometime this summer ... probably late June."