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TO: Mayor Thomas J. Weisner
FROM: Bill Wiet, Chief Development Services Officer
DATE: April 29, 2014
SUBJECT:
The purpose of the Intergovernmental Agreement is to provide a real estate tax rebate to Chicago Premium Outlets Expansion LLC, and Simon/Chelsea Chicago Development, LLC to assist financially in the expansion of Chicago Premium Outlets.
PURPOSE:
The Redevelopment Agreement, approved by City Council at their April 22, 2014 meeting, provides for up to $24 Million in assistance toward the outlet mall's expansion. The majority of the funding toward the expansion is from revenue generated in the newly created Tax Increment Financing (TIF) District 8. The other source of funding, $4 Million, will be distributed to the developer by way of a real estate tax rebate. $3.2 Million will come from Batavia Public School District 101, and $800,000 will come from the City of Aurora. The attached Intergovernmental Agreement is pursuant to Section 4.7 of the redevelopment agreement (Mechanics of the Rebate Credits). The IGA was reviewed and approved by the Batavia Public School District 101 at their April 22 Board meeting, and now awaits final approval from the City of Aurora.
BACKGROUND:
Pursuant to the agreement, the City of Aurora and Batavia Public School District 101 agree to rebate a portion of the real estate taxes collected in what was formerly known as TIF #2 and more specifically the area in the former TIF district that new construction will occur. The IGA has a ten-year period in which the real estate taxes in this specific area will be rebated to the developer, or until the full amount is rebated, whichever is less.
DISCUSSION:
This Intergovernmental Agreement, along with the provisions of the Redevelopment Agreement, provide the necessary funding to complete the major expansion of Chicago Premium Outlets. And it does so in a way that protects future sales tax revenues. There also is a mechanism in the redevelopment agreement that places a cap on the Equalized Assessed Valuation for purposed of appealing future property taxes, insuring a predictable property tax revenue stream in the former TIF #2.
IMPACT STATEMENT:
The attached IGA, which is part of the redevelopment agreement, allows for the Chicago Premium Outlets to expand to its fullest, and take advantage of the TIF and property tax revenue stream available to them. This will have a positive economic impact to the City of Aurora, its residents, and the region,
RECOMMENDATIONS:
It is recommended that the attached Intergovernmental Agreement between the City of Aurora, Batavia Public School District No. 101, Chicago Premium Outlets Expansion, LLC and Simon/Chelsea Chicago Development, LLC be approved.
CITY OF AURORA, ILLINOIS
RESOLUTION NO. _________
DATE OF PASSAGE ________________
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A Resolution Authorizing an Intergovernmental Agreement between the City of Aurora, Batavia Public School District No. 101, Chicago Premium Outlets Expansion, LLC and Simon/Chelsea Chicago Development, LLC in Regard to a Tax Rebate relative to the Expansion of the Chicago Premium Outlets Shopping Center
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WHEREAS, the City of Aurora has a population of more than 25,000 persons and is, therefore, a home rule unit under subsection (a) of Section 6 of Article VII of the Illinois Constitution of 1970; and
WHEREAS, subject to said Section, a home rule unit may exercise any power and perform any function pertaining to its government and affairs for the protection of the public health, safety, morals, and welfare; and
WHEREAS, the City of Aurora, Batavia Public School District No. 101, Chicago Premium Outlets Expansion, LLC and Simon/Chelsea Chicago Development, LLC (hereinafter "Parties") are each legal entities organized and existing under the laws of the State of Illinois, having among their powers the authority to contract with one another to perform the undertaking described herein; and
WHEREAS, the Parties seek to enter into an Intergovernmental Agreement attached hereto as Exhibit "A" in regard to a tax rebate relative to the expansion of the Chicago Premium Outlets Shopping Center; and
WHEREAS, the City Council of the City of Aurora has determined that it is in the best interest of the City and its residents to enter into this Agreement; and
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Aurora, Illinois, as follows: that the attached intergovernmental agreement between the Parties set forth in Exhibit "A" attached hereto, be and is approved and that the Mayor and City Clerk be and are hereby authorized to execute same.
PASSED AND APPROVED on ______________.
AYES ____ NAYS ____ NOT VOTING ____ ABSENT ____
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Alderman Bohman, Ward 1 Alderman Garza, Ward 2
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Alderman Mesiacos, Ward 3 Alderman Donnell, Ward 4
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Alderman Peters, Ward 5 Alderman Saville, Ward 6
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Alderman Hart-Burns, Ward 7 Alderman Mervine, Ward 8
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Alderman Bugg, Ward 9 Alderman Johnson, Ward 10
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Alderman Irvin, At Large Alderman O'Connor, At Large
ATTEST:
____________________________ __________________________
City Clerk Mayor
Legistar Number: 14-00346
ATTACHMENT:
Exhibit "A" Intergovernmental Agreement