City of Geneva Capital Spending Budget

As Usual, More Questions than Answers about the Rules of the Shell Game: The Dunkin’ Shuffle and The Emma’s Landing Grift

The City of Geneva’s annual budget document is not an audited financial report. The budget is a planning document. Still, it provides insight into the City’s priorities and planning prowess.[1] The 148-page document contains not a single explanatory footnote, and the puzzling entries and ommissions are plentiful.

A recent Brenda Shory report in the Kane County Chronicle correctly highlights capital spending as a significant component ($14 million) of the FY 2024 total budget, which is 13% higher ($128mil) than FY2023’s $113mil total. And renowned economists debate where inflation comes from? So, an examination of the Capital Projects Funds is in order. “The budget plan proposes more than $14 million in capital projects.” [2]

First, please raise your hand if you understand the ~$75K in the “Foreign Fire Insurance” revenue line. This is a classic Illinois “where’s the peanut” tax. A non-elected “Board” is empowered to expend Foreign Fire Insurance Tax proceeds for the “maintenance, benefit, and use of the Fire Department.” This Board cannot expend tax proceeds for projects not given budget approval by the City Council. The City Council cannot authorize the expenditures of tax proceeds for projects not approved by the Board.

Consequently, the system requires the City Council and the Board to mutually agree on the expenditures. A more transparent line-item title would be “Firemen’s Slush Fund.” Some municipalities have declined to levy this tax because of the “shared” power with a non-elected board. Geneva keeps its snout in the Fire Insurance trough.

As seen in FIGURE 1, Geneva’s Tax Increment Finance districts’ budgets and actual revenues are mystifying. Take TIF #2, for example. The payments for FY years 2021, 2022, and 2023 are $258K, $251K, and $266K [3] are pretty much in line. The 2022 budget called for $992K in TIF2 revenue. The superficial explanation for this is simple if you understand that the East State Street [Capital] Improvement Project has been slated to begin “next year” every year for almost a decade. Of course, the start did not happen again. And about $1.5MIL in Federal CMAQ grant money is sloshing around in the TIF #2 slush bucket. That money appears and disappears like a rabbit in a hat.

Where was the extra $750K that was budgeted stashed? TIF #2 expires this year, yet $852K is budgeted in 2024 and forecasted at $746K in 2025. How does an expired TIF generate $746K? The two TIFs combined had a $2,419,650 revenue “miss” for FY2022. What happened? Where is the footnote that explains this smoke and mirror exercise?

Before leaving page one of the budget, another question is, where is the revenue from SSA #34? This is the Special Service Area for Emma’s Landing. Remember the non-factual “Fact Sheet” the City of Geneva promulgated, which stated that the property tax on Emma’s Landing would be paid:

“Question: Do affordable housing developments pay real estate taxes? If so, are affordable housing developments assessed at the same rate as market-rate developments? Answer: Affordable and market-rate developments are taxed at the same rate as determined by the Geneva Township Assessor.” [4] FACT: LIHTC projects like Emma’s Landing are taxed under an income-based algorithm that results in the actual tax rate of about 1/3rd of the normal” “EAV” assessed valuation algorithm rate. Emma’s Landing passes two-thirds of its EAV along to the rest of the township taxpayers. Of course, zero rates (see Figures 2 and 3) are 100% lower than your property tax rate.

Another example is the Dunkin site at the corner of Crissey and Route 38. The Dunkin owner paid $715,000 for the two PIN number property in 2019. In 2018 the two parcels were assessed at a value of $336049+$103, 411, or $439,460. In 2021 the assessed fair market value was $390,343+97,717, or $488,060, after spending at least $150,000 on remodeling, equipping, repaving, lights, etc. The $850,000 investment was assessed at less than $500,000. The tax bill went from $10,532 to $10,972.60 on the parcel with the building. About 20% of the tax money went into the TIF #3 slush fund bucket. The property was sold for unpaid taxes and then redeemed. This is a mess of Burnsian proportions and will only worsen. Here is a copy of the latest tax bill for one of the Dunkin parcels:

Dunkin tax bill payable July 2022 1 Download

Here is an example downloaded today of a tax file for one of the Emma’s Landing Planned Unit Development affordable townhome parcels:

FIGURE 2: Property Tax Information for Emma’s Landing PUD Lot 3. The dollar amount on Parcel Number 12-08-225-004 is $576,000. But that number was the sale price of the entire parcel, not just PUD LT 3. However, the above file shows the “Property Class” as “8000-Exempt.” The “Tax Status” is listed as “Exempt.” The total tax is given as $0.00.

Below is what pops up when you click on the green box “print tax bill” in the Geneva Township Assessors site for the parcel 12-08-225-004 described above.

Figure 3: The result of clicking on the green “Print Tax Bill” in Figure 2.

Here is a link to the statute that is used to calculate the Illinois Property Tax for Section 42 Low-Income Housing Tax Credit (LIHTC) Projects:

35-ilcs-200-property-tax-code-33-percent-of-the-fair-market-value-of-their-economic-productivity-to-the-owners-1 Download

I suspect that none of the ten Geneva City Council Members understood what they were doing when they passed the Ordinance that created Emma’s Landing. At least, I’d like to believe this was the case. The alternative assumption is almost unthinkable. According to records in the public domain cited here, Emma’s Landing did not receive a property tax bill for 2022. The City sold the property in July 2020 for $576,000. The Illinois Housing Development Authority was duped by the City and Burton Foundation into believing the property was donated. (11831 was the IHDA file for Emma’s Landing application – see document below obtained via FOIA from IHDA.) This “donation” ruse raised Emma’s QAP Score in the competition for IHDA grant money. I’d like to believe that the motto “If You Are Not Cheating, You Are Not Trying” is not Geneva’s.

With apologies to the Scottish Bard: “Politicians’ inhumanity to taxpayers makes countless thousands mourn.”

[1] _01172023-2075 (geneva.il.us) The 148-page “FY 24 Draft Budget & FY 25 Budget Planning.”

[2] Geneva aldermen expected to approve $128.3M city budget – Shaw Local

[3] Geneva’s fiscal year ends April 30, so the FY 2023 number is projected based on the year’s first nine months.

[4] The City of Geneva, Just the Facts: Lewis Road Property Donation for Affordable Housing, Updated July 10, 2020.

10-july-2020-emma-fact-sheet-1-1 Download

11831_c1_letter-of-support_emma-s-landing-donation-via-ihda-foia-1 Download

Why Is the City of Geneva Making East Siders Sick?

The Short-Term Solution to PM2.5 Particle Pollution is Dilution

The City of Geneva received several years ago a $1+ Million Federal CMAQ Grant to help fund the East State Street rebuild that has been in the planning stage for about two decades. Every year Geneva announces that “next year” is when the project will start. The goal of the grant is to improve diesel fuel efficiency and to dilute diesel emissions as semi-trailer trucks traverse the east side. Route 38 is an Illinois State Designated Class 2 Truck Route. Hundreds of thousands of square feet of warehouses are popping up just to the east. Some of these have been approved by the City of Geneva. Others are in the Geneva system for approval. The PM2.5 pollution problem will increase.

“CMAQ” is an acronym for “Congestion Mitigation Air Quality.” The highest priority is to lower 2.5-micron particles. Please consider going to this website for a few minutes: The Weight of Numbers: Air Pollution and PM2.5 – Undark Magazine Watch the very brief video.

In the 1926 case of Ambler Realty v. Village of Euclid, the U.S. Supreme Court confirmed the legal basis of zoning. The Court recognized that public health protection is the basis of zoning authority, i.e., municipal zoning police power. Am J Prev Med 2005;28(2S2): doi:10.1016/j.amepre.2004.10.028 (activelivingresearch.org)

Geneva’s East State Street Corridor is primarily residential. The parcels that abut the right of way are zoned mostly for mixed uses, but people live in these one-lot deep ribbon zones, such as B3E. Residential zoning is directly adjacent.

What has the City of Geneva done to protect East Side corridor residents? The answer is that the City has repeatedly and consistently made the wrong decisions. The Burns Dunkin at the top of the east side hill is Exhibit A.

No place exists within the City of Geneva that is more ill-suited for high intensity use during peak traffic hours than the corner of Crissey and East State. The mayor snatched defeat from the jaws of victory when he broke the 5-5 tie that would have doomed the project. Fortunately, the ineptness of the applicant and the mayor’s handpicked staff has now delayed the opening for about five years. No one thought to get an IDOT permit that was required before the construction could legally begin. Or did both parties simply hope that would get away with the “mistake”? Mayoral addiction to TIF spending was the root of the problem.

Harry Chapin’s proverbial “thirty thousand pounds of bananas” were terrifying going down the hill into Scranton, PA, in 1974. Stopping the bananas halfway up the east side hill in 2023 and then having to begin the climb anew in first gear is even more terrifying.

Then another high-intensity use (written into the zoning ordinance for the benefit of one applicant) that generates congestion and PM2.5 pollution was spot-zoned for the Geneva Pharmacy so that TIF money could be again squandered. That business folded in less than a year.

When the first principle (dilution) of short-term mitigation of PM2.5 exposure demands more setback from the source, not less, the City granted a variance for Malone funeral home’s new parking lot that reduced the required ROW setback from thirty feet to eight feet. Then the Special Use Ordinance 2021-13 required mandate for asphalt was switched to concrete without the Municipal Code required City Council approval. Due to the localized thermal inversion created by the high albedo (colder/heat reflecting) cement, the PM2.5 particles will be trapped and transmitted to nearby homes and yards. The low albedo (warmer/heat absorbing) black asphalt would have had the opposite effect of diluting and dispersing the PM2.5 particles away from the ground.

Recently the Geneva City Council approved a plan to gift $1.5 million in TIF funds to the Mayor of Naperville to build a retail outlet/high-density multistory affordable residential building with the only access/egress being Crissey directly across a substandard width street from the Dunkin exit. This, too, will require spot zoning and setback variances to move the future residents even closer to the PM2.5 source just outside their open windows. And it will add even more congestion at Crissey and E. State. Absurdly, the City will give away more money to exacerbate air pollution exposure than it received from the Feds to mitigate that same air pollution.

Other examples of bonehead aldermanic and mayoral decisions largely driven by Tax Increment Financing Addiction Syndrome (TIFAS) could be raised.

Longer term, the promise of electric vehicles could reduce PM2.5 particle pollution. But young children are particularly vulnerable, as are older people and those with chronic illnesses. For now, the City of Geneva needs to stop trying to injure those whose health and welfare it has sworn to protect through its zoning police power.

Geneva’s Two-Decade Funeral Processional to Infamy

Plate from ‘Pompa Funebris … Alberti Pii’, after Jacques Francquart, illustrating the funeral procession of Albert the Pious (1559–1621), Archduke of Austria, son of Emperor Maximilian II. Albert VII (German: *Albrecht VII*; 13 November 1559 – 13 July 1621) was the ruling Archduke of Austria for a few months in 1619 and, jointly with his wife, Isabella Clara Eugenia, sovereign of the Habsburg Netherlands between 1598 and 1621. Prior to this, he had been a cardinal, archbishop of Toledo, viceroy of Portugal and Governor General of the Habsburg Netherlands. He succeeded his brother Matthias as reigning archduke of Lower and Upper Austria, but abdicated in favor of Ferdinand II the same year, making it the shortest (and often ignored) reign in Austrian history.

Many sins can be forgiven, but not the Unrepented.

Geneva’s East State Street Corridor has fared dreadfully during the long reign of an overly incumbent mayor. The wrecking ball has been his favorite tool, and deceit remains his favorite political tactic. His posse has been his hand-picked inbred administrative staff. The City Council, stricken with chronic Stockholm Syndrome, have been his minions. The result has been the “Geneva Way” of deception, concealment, prevarication, secret meeting tape destruction, and fraud. Somewhere between Archduke Albert, the Pious, and Boss Kevin Burns, the Perpetual, was a sweet spot in duration for reigns. But that moment was long ago.

To the City Council of Geneva,

“As we act, let us not become the evil we deplore.” Nathan D. Baxter

My family continues to be subjected to daily nuisances, health threats, and financial exploitation from the unauthorized demolitions and unlawful constructions at 314 and 316 E State Street, Geneva.

First, valid applications for demolition permits, special uses, variances, and site plans for 314 E. State Street were never submitted to the City of Geneva. A proper public hearing was never convened. Unauthorized demolition of the historic building at 314 E. State Street occurred. Route 38 Properties, L.L.C. owns this 314 E State parcel. This owner was never identified at any time in any required notice, during any public hearing, or any City Council proceedings. The property rights of this unidentified L.L.C. far exceed those of any Geneva citizen (the politically well-connected habitually excepted). Think Emma’s Landing with its fistful of shady interlocking (to the extent of actual marital bonds in one glaring case) developer/builder/ownership L.L.C.s.

Second, the parcel at 316 East State was first unlawfully used as a parking lot twenty years ago after the unauthorized demolition of another historic structure (a small early settlement period Greek Revival-styled home). The parking lot was unlawfully constructed under a “remodel” building permit in 2002. In 2022 the 316 E. State configuration was altered, and the asphalt surface was replaced with concrete. All this without any site plan or building permit that depicts or authorizes this construction.

For many months, the City of Geneva has gas-lighted and ghosted citizens by consistently failing to respond to questions about the unlawful activities described above. The City has chosen to ignore Illinois Law and specific and general City of Geneva Ordinances. The City has conspired with private beneficiaries (Malone and Route 38 Properties, L.L.C.) to create off-the-books “wink and nod” unlawful “exceptions, deviations, reliefs, and conditions.” Examples include public R.O.W. encroachments, absent setbacks, paved parkways, code-violating parking isles, islands that are too few and smaller than the required 148 square feet, obstructions in A.D.A. stalls, and others. The City went to the unprecedented extent of officially granting permission to violate special use standards.

I understand that a conspiracy is, in a broad legal sense, an agreement to commit an unlawful act. In British and some American courts, lawful acts that finish in an unlawful manner are also included (In British parlance, a ‘conspiracy to injure’; in American, a ‘true conspiracy’). Some states require an overt act. (Common law rule does not.) A common understanding among the citizenry is that “you can’t fight city hall.” A corollary is that citizens’ rights depend on the integrity of their rulers.

For example, where is the Geneva Ordinance 2021-13 mandated fence along the western boundary? Under whose authority and why was noise-amplifying, light-reflecting cement substituted for the noise-abating, light-absorbing asphalt required in the site plan codified into law by Geneva Ordinance 2021-13? Who authorized the Geneva administrative staff to gas-light and ghost citizens injured by officially sanctioned conspiratorial misconduct?

The Malone Funeral Home has been a slow-walking infamy for two decades. The expansion in 2001-2002 onto an adjacent lot (purchased in 2000) with only a “remodel” building permit was illegal. A Special Use Ordinance passed after a valid Public Hearing was required but “over-looked” under the current mayor-for-life administration. In 2012 the 324 E. State property was found to have failed 8 of 9 Special Use standards, so the Special Use was denied. (Failure to meet just one standard causes the application to fail.) That same parcel was found to meet all nine standards in 2021 when nothing had changed in the intervening years.

The 2021 special use process was flawed from the start. The applicant was unlawfully “coached” by City Staff in secret for months, as demonstrated by the FOIA/OMA Public Action Council’s binding opinion. The initial public meeting notice was fraudulent and untimely (the hearing followed the notice by many months – months lead time for applicants, days for opponents). Where is a retroactive Special Use authorized in Illinois’ Constitution or Statutes? After an illegal expansion, when does “pre-existing non-conforming” become “illegal non-conforming” in Geneva? Immediately, if the law were followed. Never, if you “know” the mayor. The City of Geneva granted the first retroactive special use ever bestowed in Illinois, but with deceit as its only authority.

I hope the City of Geneva has enough remaining decency to disband its Diversity, Equity, & Inclusion Task Force. The City must walk that walk itself before disingenuously inviting others to talk that talk under the auspices of its false flag.

Once again, I ask that the use of the above-cited unlawful parking lot be immediately and indefinitely halted.

Rodney B. Nelson, M.D., F.A.C.P., former Major U.S.A.F.
23 Kane Street
Geneva Illinois

Audio tape from April 12, 2012, Geneva Plan Commission meeting discussing the staff “error” made in 1999-2002 when the Malone Funeral Home was expanded without the required Special Use Permit. The only building permit was classified as a “Remodel Commercial.” The First voice is the current Geneva Director of Development. The second voice is the 2012 Geneva Director of Development, Richard Untch. Mr. Untch does NOT MENTION the construction of the parking lot at 316 E State, which was re-constructed in 2021 without a Special Use Permit or Building Permit.