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Evanston city officials now say they plan to spend only $2 million over the next eight years on a proposed tax increment financing district for the Dempster-Dodge shopping center.

Staff previously had said they believed the TIF could generated $20 million to $23 million for improvements to the Evanston Plaza, with no detail provided about how much money might be spent when over the TIF’s projected 23-year life.

A new memo from Community and Economic Development Director Steve Griffin suggests the $2 million limit should apply until a year before the Dominick’s supermarket lease at the plaza is scheduled to expire at the end of 2020.

The tie-in to the supermarket’s lease is based in part on the city’s failure so far to get a commitment from Dominick’s that it would waive provisions in its lease that sharply restrict the kinds of new businesses that can go into the shopping center.

Those restrictions appear to have been a major factor in causing the high vacancy rate at the plaza — which now stands at roughly 50 percent.

Griffin said the staff may have an update about that from chain officials based in Calgary, Alberta, in time for tonight’s meeting.

The council is under pressure to act on the TIF designation tonight, because it represents the last chance to use the property’s 2010 assessed value of $10.8 million as the basis for calculating the TIF’s future revenue.

Because the court-appointed receiver that held the property last year failed to appeal an increased tax assessment, the property now is valued at $14.5 million.

The cumulative cost of using the higher basis over the TIF’s life, Griffin says, is expected to be $5.2 million — reducing total projected TIF revenue from $23.7 million to $18.5 million.

The TIF proposal has sharply split the City Council, with Aldermen Don Wilson, 4th Ward; Mark Tendam, 6th Ward, and Coleen Burrus, 9th Ward, expressing opposition to it.

Related stories

Evanston Plaza TIF vote held for talks with grocer

Doubts raised on Evanston Plaza tax district

City may spend $20 million on Dempster-Dodge

Related document

Staff memo to City Council (.pdf)

Bill Smith is the editor and publisher of Evanston Now.

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1 Comment

  1. More TIFS is not the answer

    So rather than the initial estimate of spending $20 million on the 35 year old shopping center, city officials now want to limit it to just $2 million. Is that suppose to make this more palatable?

    Oh yes, creating a TIF for a shopping center and spending $2 million of taxpayer's money to upgrade, renovate and attract businesses sounds like a swell deal –  for Bonnie Investments who purchased the property in a foreclosure.

    I wouldn't oppose a TIF for that shopping center if it were old dilipidated and totally vacant and the best use was something that could be developed NOW in this CURRENT economic climate. But as it stands, the shopping center appears in decent condition and is half vacant. The reason isn't because of the center's condition – it's because of the poor economy, city taxes and regulations and location.

    Bonnie Investments should have known about Dominick's lease provisions, and it should be their responsibility not the city's to try and work out some compromise. Why is the city even involved in lease negotiations with Dominicks?

    Maybe Dominicks wasn't too happy to learn that Evanston paid $2 million to a competitor, Trader Joes,  for a parking lot and leased it back to Trader Joes for 70 years at a one time fee of $50,000.

    The solution to the Evanston Plaza high vacancy isn't another TIF. The solution is multi-faceted –  lower city taxes, tax incentives for existing businesses or startups to relocate to Evanston,  an aggressive and capable Community and Economic Development staff to lure businesses to Evanston not with a blank check but with an attractive and knowledgable approach. Sell Evanston. It's an easy sell since it is one of the most dynamic and interesting suburbs in the nation. 

    Evanston city officials really need to get their mind off of new TIFS and start thinking about tax relief for property owners. Cut labor costs, privatize services and close one of the two Central Street fire stations to pare down the budget and REDUCE taxes. Simply giving businesses and property owners a sense that taxes (expenditures) are going down would create a mindset that they can spend more and take more risks.

    There was a time you could create a TIF and developers would flock like hungry squawking seagulls because the condo market was gangbusters.

    Those days are long long gone baby

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