Township and Fire District Reimbursement

In accordance with State law, after annexation of property the City of Champaign is required to reimburse the Townships and Fire Districts for the loss of revenue they experience. The City reimburses the Townships for 10 years after an annexation, and the Fire Districts are reimbursed for 5 years with the amount decreasing by 20 percent each year. The Planning and Development Department calculates the total Equalized Assessed Values for all of the annexations that occur in a year, and then uses the tax rates for each taxing district to reimburse the Townships and the Fire Districts as shown below. In recent years the City has been requiring new fringe development to provide contiguity and annexation prior to the start of development. This results in the township reimbursement being based on the undeveloped land value. This approach, along with fewer large scale annexations, has reduced the amount of the township reimbursement over the years.

Township Reimbursement WAR item December 2014 (1)_Page_1

State law requires that payments to the townships are made twice a year, once in July and once in December. These payments are made for the previous fiscal year. The payments for the Fire Districts are made once in December for the previous calendar year. For December the City paid the following amount to two townships and two fire districts:

Hensley Township – $2,119.96                      (December Payment)
Champaign Township – $5,785.00               (December Payment)
Scott Fire District – $105.26                           (Annual Payment made in December)
Eastern Prairie Fire District – $54.76           (Annual Payment made in December)

Total December Reimbursement – $8,064.98
Total Annual Reimbursement – $16,336.87

Last year, there were three annexations to the City of Champaign. The largest annexation was New Century Estates Mobile Home Park, which also included the annexation of a single family home by surrounded territory. The other two annexations were a result of a strategic annexation agreement at the eastern corners of Staley Road and Springfield Avenue. All three annexations were in Champaign Township. Of the three properties annexed, the two properties on Springfield did not pay into a fire district, while the New Century Estates paid into the Scott Fire Protection District.

In recent years, the City of Champaign has worked to annex proposed development prior to construction. This scenario both reduces urban sprawl and the inefficient extension of services to new development on the perimeter of the City, and it allows the City to annex the property at an agricultural rate rather than the rate for developed properties, which greatly reduces the amount of money reimbursed over time. The amount reimbursed has steadily dropped over the years.