Bill would expand airport’s taxing authority, but why?
ROCKFORD — A proposed bill would allow the Chicago Rockford International Airport to expand its corporate authority and tax thousands of additional people in the county where it’s located.
State Rep. Jay Hoffman, D-Bellville, introduced the legislation, the Register Star reported. Regional airports in Moline and Bloomington would also have the ability to expand their property tax reach to the entire counties where they’re located.
The Rockford airport currently levies property taxes in Rockford, Machesney Park, Loves Park and a portion of land west of Rockford city limits at a tax rate of 11 cents per $100 of assessed property value.
Thousands of people living in Winnebago County but outside the airport’s corporate limits are benefiting from the jobs and economic development the airport provides without paying taxes to support it, said Mike Dunn, the airport’s executive director.
Widening the airport’s property tax reach in Winnebago County could provide an estimated $1 million annually, Dunn said.
“As an airport authority we get 95 percent of our funding from the state and the feds,” Dunn said. “But that’s tightening up, so we’re being forced to look at alternatives now.”
Dunn said he’s speaking with area lawmakers to gauge their support on the bill.
“Based on those conversations, and if the airport staff or I decide to proceed, then we’ll make a recommendation to the board in March,” Dunn said. “If we don’t like what we’re hearing, we’ll pull out” of the bill.
Why the increase?
Part of the reason the airport authority may be looking to expand its tax base? The $17 million in loans it took out to cover the funding gap for the maintenance and repair facility that opened in 2017.
Planning documents showed the airport was waiting on $15 million in financing from the state and another $10 million in federal funds. But the state funds were never appropriated in a budget plan, a report by The Times in 2017 showed. And the federal grant had a trigger clause relying on the release of state funds.
In the end, the airport took on $17 million in debt from local banks and the county footed the bill on another $8 million in bonds to complete the project, a move which included a backdoor tax increase for county residents should the funding not come in.
Estimates The Times received in August showed that the airport’s loans were accruing around $80,000 in interest payments per month, or around $960,000 per year. That means the $1 million annual increase in tax collections under the new plan would go almost entirely to servicing the debt taken out to complete the maintenance facility.
There have been no indications that any federal or state funds are on the way to pay for the MRO project, leaving Winnebago County taxpayers on the hook for the $25 million secured to complete the project. R.
–Associated Press; With Staff reports