Enterprise Zone Residential Incentive Approved by State DCEO

The Effingham/Effingham County Enterprise Zone has announced that an amendment to the Effingham Enterprise Zone to help spur residential development has been approved by the Illinois Department of Commerce and Economic Opportunity. The amendment has been made possible through cooperation and partnership with the City of Effingham, Effingham County, and the Village of Teutopolis, along with 14 other taxing bodies which are located within the Zone boundary.

City Economic Development Director Todd Hull told the Effingham City Council Tuesday night that the amendment had passed its first hurdle.

During the Fall of 2022, the Effingham/Effingham County Enterprise Zone Board approved to move forward with an application proposing to add incentives for residential development. The Board felt that these incentives could help local employers with their need for additional employees. One of the identified barriers to hiring has been a lack of available housing. By adding the proposed incentives to the Enterprise Zone, the hope is to ease the burden with the cost of building single-family and multi-family homes and to encourage development.

The proposed additions that have been approved include real estate tax abatement and building material sales tax exemption. A newly constructed single-family home located within the Enterprise Zone boundary is eligible for a five-year property tax abatement on the increase to the base amount. A newly constructed multi-family home located within the Enterprise Zone boundaries is eligible for a three-year property tax abatement on the increase to the base. All newly constructed single-family homes and multi-family homes located within the boundary, along with any residential rehabilitation projects located within the boundary with a cost of $50,000 or more, will be eligible for a sales tax exemption on all permanently affixed building materials.

Effingham was awarded a new Enterprise Zone on January 1, 2018. The Effingham Enterprise Zone has an initial life of 15 years, with the possibility of a 10-year extension. The original Enterprise Zone was in effect from 1988 to 2017 and resulted in over 475 projects, $700 million in investment, 4,000 jobs created, and 2,500 jobs retained. In addition to the newly approved residential incentives, the Effingham Enterprise Zone offers the following incentives: a seven-year property tax abatement on industrial projects, a three-year real estate tax abatement on commercial projects, and a sales tax exemption on permanently affixed building materials, along with other state offered incentives.

If interested in applying for incentives within the Effingham Enterprise Zone please contact Sasha Althoff, Enterprise Zone Administrator at 217-342-5300 Ext. 4 or salthoff@effinghamil.com. To view the current Enterprise Zone boundaries please visit the City website at www.effinghamil.com/enterprisezone.