River Edge Redevelopment Zone
The State of Illinois created the River Edge Redevelopment Zone Program to stimulate development of environmentally challenged properties near rivers through the use of tax incentives.
The River Edge Redevelopment Zone was established to create and retain jobs and stimulate business and industrial retention and growth. What sets it apart from other such programs is an emphasis on returning environmentally challenged sites (“Brownfields”) to productive use. The Zone was approved August 27, 2007 and will be in effect for 30 years through the year 2037.
Rockford River Edge Redevelopment Zone Incentives
Building Material Sales Tax Exemption
Building materials used in new construction or rehabilitation for non-residential projects located within Rockford’s River Edge Redevelopment Zone and permanently attached to the real estate may be sales tax exempt (8.25%) if a retailer is provided with a Certificate of Eligibility issued by the Illinois Department of Revenue. Certificates are valid for up to two years.
To apply for Building Material Exemption Certificates:
- Submit River Edge Redevelopment Zone Project Application Form
- Contractor’s Application – Exemption Certificate for Building Materials (Each entity purchasing materials must obtain its own certificate).
Applications can be submitted to Rea Anderson by e-mail, in person or by mail, 425 E. State Street, 2nd Floor, Rockford, IL 61104.
*Project Completion Report must be complete & submitted within 30 days of project completion.
Individuals, corporations, partnerships, trusts or estates receiving dividends declared by corporations which are located exclusively in Illinois River Edge Zone and which conduct essentially all of their business in the River Edge Redevelopment Zone, may deduct such dividends on state income tax.
Interest Income Deduction
Allows financial corporations to deduct an amount equal to the interest received for a loan for development in an RERZ from their corporate State Income tax. The loan must be secured by property located within an RERZ.
The River Edge Historic Preservation Credit is equal to 25% of a project’s qualified rehabilitation expenditures for certified historic structures within the River Edge Redevelopment Zone. The Historic Tax Credit Program runs through December 31, 2026.
Property Tax Abatement
Properties may be eligible for abatement of the City of Rockford’s portion of incremental property taxes depending on type of industry, level of investment, and number of jobs created (see abatement schedule). The amount of the abatement cannot exceed the amount attributable to the construction of improvements or the rehabilitation of existing improvements on the parcel. Properties that are also within a Tax Increment Financing District are not eligible.