Lincolnwood board approves incentives for Porsche dealer

by Kevin Gross

The Lincolnwood Board of Trustees at its meeting Wednesday, Jan. 2, extended sales tax sharing incentives allowing Loeber Motors to renovate its Porsche, Mercedes and Smartcar dealership at 7101-7111 N. Lincoln Ave. and acquire a new warehouse at 7125 N. Lincoln Ave.

"This is a great place for us, we are able to get clients from the city and we’re able to get clients from the North Shore," dealership president Mike Loeber said.

Loeber said that the currently vacant two-story warehouse at 7125 N. Lincoln Ave. would be used as a facility for detailing and storage of automobiles, which would allow the group to expand the showroom, service bays and office space to two stories at the existing Porsche dealership and, upon future completion of all improvements, allocate an additional 80 to 100 vehicles for annual sale at the dealership.

"An increase in sales tax revenues is likely because there would be an additional allocation of additional Porsche vehicles to be sold, with the expanded storage area," community development director Steve McNellis said. "And that is possible only with two scenarios occurring. One, the acquisition of the half-acre (warehouse) parcel so there’s enough storage for these vehicles to be located on site. And secondly, that the Porsche showroom is rebuilt to pretty exacting standards from Porsche."

As McNellis explained, the Village would share 50 percent of taxes from Porsche and Smartcar sales for 15 years after construction is completed, with a $7 million cap on Village-shared revenues throughout the duration of the agreement and a "claw-back" clause allowing the Village to retrieve past tax revenues if the dealership closes. The Village also approved Loeber’s request to apply for a five year Class 7C abatement of property tax payments from the new warehouse to Cook County, which McNellis said would help with an estimated $1.5 million to purchase and landscape the new site and renovate the warehouse’s roof, on top of an estimated $6 million in costs to renovate and expand the existing Porsche facility.

The incentives build upon an existing 15-year sales tax sharing agreement that was approved in 2004, which to-date has resulted in the sharing of about $1 million in Village revenues, or about $137,000 of the $274,000 the dealership has paid in average annual sales taxes.

Trustees approved the incentive framework and directed Village attorney Steven Elrod to write the final incentive contract for formal approval at a future Board meeting. Granting of the property tax abatement would be pending final decision by Cook County entities.

Staff also provided an update on negotiations over economic incentives for the mixed-use District 1860 Development, which is proposed to feature three buildings worth of hotel, apartment and retail space at the former Purple Hotel site, 4500-4560 W. Touhy Ave.

As Elrod explained, developers Tucker Development are pushing to receive a 70 percent share of hotel tax revenues, based on the Village’s current 7 percent hotel tax rate. A cap would limit the Village from rebating more than $3.3 million in hotel tax revenues.

"The hotel tax rebate would not be subject to any additional increment," Elrod said. "So if you increase it (hotel tax rates) from 7 to 8 percent, the rebate only applies to the 7 percent. (The Village) would be able to collect 100 percent of that additional 1 percent."

Developers and Lincolnwood staff have also discussed restarting a new North Lincoln Tax Increment Financing District largely around the site borders, which would replace the existing Lincoln-Touhy TIF District that has devalued and lost time. Elrod said that the first TIF note issued to Tucker Development could be valued at up to $25 million, which would be paid only with future incremental tax revenues and not with any Village funds or credit, and that developers would only start receiving TIF benefits after meeting 15 conditions, which include finalizing a hotel development partner and providing the Village with lists of final construction loans and plans.

Elrod added that in order to insulate area schools from possible lost tax revenue due to the TIF District or burden from new children moving into the development, involved parties are negotiating a revised intergovernmental agreement that is not yet finalized but "would reflect the Village’s effort to prevent School Districts 219 and 74 from impact in the event that there were school-aged children in this development beyond the minimal amount predicted by Tucker."

Elrod also noted that the development proposal has "already been through the Plan Commission’s preliminary approval and has received preliminary approval from the board from a zoning perspective," meaning that the final development would likely conform largely with previously discussed plans calling for a 98 foot tall, seven story apartment and commercial building at the southeast site corner, an 80 foot tall, 220 room hotel building at the north site corner, and a one story retail structure along the southwestern site border. He added, however, that a proposed new traffic signal by Lincoln and Chase avenues might not be approved, as the Illinois Department of Transportation claimed it may be located "too close" to existing signals.

The site redevelopment plan and the new TIF district’s creation should come to a final vote at the Board’s next meeting on Tuesday, Jan. 15, according to Elrod.

As part of the consent agenda, trustees approved code variations and a special use allowing construction of a temporary telecommunications tower at 7015 N. Central Park Ave.

The temporary tower would be necessary to relocate telecommunications equipment for private service providers while Lincolnwood’s water standpipe structure, which normally houses its telecommunications cables, undergoes maintenance estimated to take one to two years.

Code variations would allow the tower to be 150 feet tall, versus the Village’s normal height restriction of 80 feet for communications towers, allow a smaller setback of 26 to 31 feet from the lot lines versus a normal setback requirement of 110 feet, and allow the tower to be located within a quarter-mile of another tall structure, namely the existing 130-foot-tall standpipe.

Trustees also authorized a contract within the consent agenda for the replacement of a water pump at the Lincolnwood pump house by Schreiber and Crawford avenues.

The pump is 30 years old and has seen about 68,000 hours of use, exceeding the American Water Works Association’s recommendation of replacing pumps after 50,000 hours. The replacement would also have a variable frequency drive allowing the motor to vary from pumping 800 to 1,500 gallons of water per-minute, differing from the old pump’s fixed 1,000 gallon-per-minute rate.

Dahme Mechanical Industries was chosen among four bidding contractors as the cheapest option to replace the pump, and had been responsible for previous Lincolnwood water pump replacements in 2018. The replacement is expected to cost $111,245, funded by $106,000 included in the fiscal year 2018-19 Village budget and $5,245 that will be re-appropriated from other items in the Village’s water/sewer fund.

Also as part of the consent agenda, trustees approved a lighting program for the Valley Line Bike Trail overpass, which was completed in 2018 over Touhy Avenue. The accent lighting system can be programmed to change colors in recognition of certain events, which will include at least 13 holidays including Thanksgiving, Christmas, Hanukkah, Patriot Day and President’s Day.

Mayor Barry Bass also reported that the Village received the Government Finance Officers Association’s distinguished budget presentation award for another consecutive year.

"This award is the highest form of recognition in governmental budgeting and represents a significant achievement by the Village," Bass said. "Congratulations to (finance director and interim manager) Bob Merkel for this distinguished award."