Aurora has begun the process of establishing a tax increment financing district for the property where Hollywood Casino plans to build a casino complex on the northeast side of town.
Hollywood Casino plans to move to the new site from its current location in downtown Aurora.
The property along Farnsworth Avenue and Bilter Road is the site where Penn Entertainment, the casino’s parent company, will build the new $360 million casino.
The site will include 950 gaming stations, a Barstool Sportsbook, a 200-room hotel, six restaurants, meeting rooms, an outdoor event area and a 10,000 square foot event center.
In late October, the city council approved a redevelopment deal with Penn Entertainment that includes incentives for the project. One is a general bond of $58 million that the city would spend to help cover the initial costs of the project.
The intention is to pay the bond service every year for 20 years with the money generated by the new casino. Establishing the Tax Increase Funding District would be how the city would collect the money each year to pay the bonds.
In TIF districts, the assessed value is frozen for tax collection purposes, and as the value of the property increases, the taxes created by the increase in the value of the property are paid into a special fund, called increment. This money is used for development-related expenses.
The city estimated that property taxes would generate more than $5 million a year in the increase. If the property does not earn as much each year, the casino has agreed to make up the difference to make the bond payments.
To establish the TIF district, the city must qualify the property, and members of the council’s finance committee last week recommended paying $42,000 to Kane McKenna and Associates to complete the feasibility study needed to establish the TIF district. TIF district.
Currently, the property is in the city’s seventh TIF district, but the city intends to carve out ownership of the casino to create its own micro-TIF.
Kane McKenna provided previous analysis of the TIF district and other development tools for the city.
Members of the finance committee also recommended a resolution that would allow the city to eventually use TIF money to pay for costs incurred in setting up the TIF district.