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TO: Mayor Richard C. Irvin
FROM: Trevor Dick, AICP, LEED AP, Director of Development Strategy and
Development
DATE: May 23, 2019
SUBJECT:
Introduce an Ordinance proposing the approval of the Business District (BD) Plan and designating the Business District, and setting the July 23rd, 2019 City Council Meeting for a Public Hearing on the proposals to approve the Business District Plan and designation of the Business District to Finance Committee.
PURPOSE:
The Petitioner, Pacifica Square LLC is requesting approval of the creation of a business district to induce development interest within the project area. Staff is working with our consultants Kane, McKenna and Associates, and Klein, Thorpe and Jenkins, Ltd to assist with the creation of this Business District.
BACKGROUND:
The Subject Property is generally located north of New York Street, west of Route 59, south of Drexel Avenue and is currently utilized as a shopping center with B-2(S) Business District-General Retail zoning; with special sign district for lots of Yorkshire plaza subdivision located at 4300-4462 E. New York Street.
The Yorkshire Plaza is a mostly vacant shopping center in the Route 59 corridor. The center has been suffering high vacancies and decreasing sales for approximately ten years. There are approximately 365,000 square feet of space in the center which includes a Best Buy that received an earlier sale tax abatement as a measure to keep them in place. The property is now in control by Pacific Square LLC. The company is controlled by Mr. Eddie Ni who owns properties in Carol Stream, Plainfield, New Lenox, Atlanta and various locations internationally.
DISCUSSION:
Attached is a Business District Plan prepared by Kane, McKenna and Associates that is intended to guide improvements, activities and projects within the subject property in order to stimulate private investment.
Designating a Business District will allow the City to evaluate the projections and impact for the owner to assess as much as 1% in sales taxes above the tax rate currently in place. The development agreement, approved in February 2018, calls for ownership to recover eligible expenses from future sales tax receipts in the BD over a period of up to 23 years.
This, together with a sales tax sharing agreement based only on increases in sales taxes will enable the owner to secure its necessary it’s financing to compete his purchase. The right to assess additional sales taxes plus allowing the owner to capture increases in sales taxes above the 2017 base to a limit of $4.0 Million or for 10 years, whichever comes first, could provide approximately $7.3 million relating to the existing retail (Phase I). In the future, BD dollars may also be used also for eligible expenses above this $7.3 Million threshold for a Phase II (a future office building or another approved use for the area that currently houses the Mattress Firm and liquor store) and/or a Phase III (an apartment building in an area within the existing parking lot for the inline retail) as long as the maximum dollar revenue sharing outlay between the TIF (see resolution 2) and the BD coupled with the aforementioned $4.0 Million tax sharing, does not exceed $15 Million.
Key steps in the process of approving this Business District include:
Introduce Ordinance and setting the time and place of the public hearing at the May 28th 2019 - Finance Committee May 28, 2019
- Introduce Ordinance to COW June 4, 2019
- Approval of the Ordinance by City Council June 11, 2019
- Publish notice of Public Hearing June 24, 2019 (30 days prior) and on or before July 14, 2019
- Introduce Public Hearing to Finance Committee July 9, 2019
- Introduce Public Hearing to COW July 16, 2019
- Public Hearing held by City Council July 23, 2019
- Introduce Ordinance approving the business district plan to Finance Committee July 23, 2019
- Introduce Ordinances to COW July 30, 2019
- Introduce Ordinances to Council August 6, 2019
IMPACT STATEMENT:
Staff would anticipate that this project will increase the City’s overall tax base, by facilitating investment and development, which will offset any incidental Department or staffing impacts.
RECOMMENDATIONS:
Staff would recommend introducing the Ordinance proposing the approval of the Business District Plan and designating the Business District, and setting the July 23rd 2019 City Council Meeting for a Public Hearing on the proposals to approve the Business District Plan and designation of the Business District.
cc:
Alderman Robert J. O’Connor, Chairman
Alderman Edward J. Bugg, Member
Alderman Theodoros "Ted" Mesiacos, Member
CITY OF AURORA, ILLINOIS
ORDINANCE NO. _________
DATE OF PASSAGE ________________
title
An Ordinance Proposing the Creation of a Business District in the City of Aurora and the Establishment of a Public Hearing in Connection With The Same (Yorkshire Plaza/Route 59 Business District No. 1)
body
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, Section 11-74.3-1(1) of the Illinois Business District Development and Redevelopment Law, 65 ILCS 5/11-74.3-1, et seq. (“Law”) allows a municipality to determine that it is “essential to the economic and social welfare of the municipality that business districts be developed, redeveloped, improved, maintained, and revitalized, that jobs and opportunity for employment be created within the municipality, and that, if blighting conditions are present, blighting conditions be eradicated by assuring opportunities for development or redevelopment, encouraging private investment, and attracting sound and stable business and commercial growth;” and
WHEREAS, it is in the public interest that the area depicted in the map in Exhibit A, attached hereto and made a part hereof (“Proposed Business District”), in the City of Aurora (“City”), be considered for designation as a business district pursuant to the terms of the Law; and
WHEREAS, on July 23, 2019, the Mayor City Council of the City of Aurora authorized Kane, McKenna & Associates, Inc. to prepare a business district plan for the Proposed Business District; and
WHEREAS, it is in the public interest that the City consider the approval of a business district plan for the Proposed Business District, and consider the designation of the Proposed Business District as a business district with a finding and determination that the Proposed Business District is a blighted area, pursuant to the terms of the Law; and
WHEREAS, the Proposed Business District is totally within the corporate limits of the City;
NOW, THEREFORE, BE IT ORDAINED by the City Council of the City of Aurora, Illinois, as follows:
SECTION 1: That the preambles of this ordinance are hereby incorporated as though fully set forth herein.
SECTION 2: That a public hearing shall be held at 6:00 p.m. on July 23, 2019, at the Aurora City Hall, Council Chambers, 44 East Downer Place, Aurora, Illinois 60507 (“Hearing”), to consider whether to approve a business district plan for the Proposed Business District, as set forth in the Law, and whether to designate the Proposed Business District as a business district with a finding and determination that the Proposed Business District is a blighted area, as set forth in the Law.
SECTION 3: That notice of the Hearing shall be given by publication at least twice, not more than thirty (30) nor less than ten (10) days prior to the Hearing, in a newspaper in general circulation in the City, in substantially the same form as in Exhibit B attached hereto and made a part hereof, with such changes being made to Exhibit B as are necessary to complete the publication notice.
SECTION 4: That all ordinances, orders and resolutions and parts thereof in conflict herewith shall be and the same are hereby repealed.
SECTION 5: This Ordinance shall be in full force and effect from and after its adoption and approval as provided by law.