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Appellate court denies rehearing Gardner TIF case

GARDNER – The village of Gardner’s attempt to have the state appellate court rehear its case with Gardner-South Wilmington High School regarding TIF dollars has been denied.

“It is good news. It’s just time to stop spending money,” Superintendent Michael Perrott of the high school said Tuesday.

On July 2, the Third District Appellate Court overruled and denied the village’s request for a rehearing, according to court documents. This follows its April decision to uphold the Grundy County court’s previous decisions in favor of the school.

The village was informed of the court’s order at its board meeting Monday, Village Attorney Scott Belt said Tuesday. But the board took no action on the next step regarding this case.

“The primary option they can consider is filing a petition for leave to appeal with the Illinois Supreme Court within 35 days,” Belt said. “If they would like to go that route, the deadline would be Aug. 6 to have that petition filed.”

School District 73 filed its original lawsuit in 2012, alleging the village violated a 1986 tax increment financing agreement under which the school should have received more than $400,000 in 2012. Since that time, the village has paid all but about $70,000 to the school – the amount the village disputes.

The village maintains that, under a new law, it is required to make sure the taxing bodies are spending the TIF funds properly and it appeared the district was not.

A TIF district allows for municipalities to develop blighted areas by freezing equalized assessed values and using the monetary difference between the frozen EAV and current EAVs to fix up the areas.

The village argued the TIF money was only to be used for capital expenses, such as new construction and remodeling. When the village discovered some of the money, about $70,000, was being used for salaries and benefits, it withheld the money arguing it is obligated to monitor TIF funds and make sure they are spent in accordance with the law.

With the support now of both the local and appellate courts, the school district continues to argue its agreement is a license agreement, differing from a traditional TIF agreement, and allows the district to use the funds however the school needs.

The district and the village’s agreement is for use of its recreational facilities to be used by the public when the school is not using them. In return for the use, the district gets a portion of the TIF funds. Because the agreement is for the use of facilities within the TIF district, the appellate court ruled the TIF act does not restrict how the district spends the funds.

“Right from the beginning, the point from the village was they just wanted to make sure this was legal and this is the fourth time they have received an answer from two separate courts regarding this – it’s legal,” Perrott said.

He continued that the issue does not need to go any further. The taxpayers, Perrott said, are the ones paying for this legal battle double through their taxes to the school district and the village.

“It just doesn’t make any sense. It’s time for the village, school district and the community to continue on,” he said.

The village meets again July 28, Belt said, which would leave a little more than a week for the petition to be filed with the Supreme Court, if the village decides to go this route. If the village does, and the court accepts it, a briefing schedule would be set and eventually oral arguments.

If the village moves forward with petitioning the higher court, the court does not have a specific timeline to follow in answering if it will accept or deny the case, Belt said. Therefore both parties could be waiting for quite some time.

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