Wednesday, April 13

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City improves commitment to warehouse distribution incentive plan     Send a link to a friend 

[APRIL 13, 2005]  Full-swing efforts to sway a large company to locate on Lincoln's west side are nearing completion. Lincoln/Logan County Development Partnership director Rob Orr has led and coordinated meetings and information as city and county officials try to entice the company that is looking to build a large warehouse that will run a wholesale distribution center. The company has been patient in waiting for the city and county to organize and make commitments that would put the necessary infrastructure in place and to offer incentives like those they can find in other communities.

It has been an intense several months of numerous meetings. The opportunity falls as both city and county recover from tight times. Yet, it is the type of initiative that will aid in county and community revenues for the future and likely turn a sagging economy around.

The city finance committee called a special meeting last night that was followed by an adjourned meeting that allowed them to complete their commitments toward the development.

Last month, city finance committee chairman Verl Prather recommended that some of the new sales tax revenue intended for infrastructure be designated toward the project. Motor fuel tax can be used for it as well.

The city agreed to supply a requested $600,000 from those funds upfront and an additional $110,000 per year for five years to be used toward infrastructure.

Additional financing of $10,000 for 10 years to be used toward the purchase of land was also approved at the city's March 22 meeting. Those funds would be taken out of general revenue.

However, as plans have progressed, the project was still short on funds, and Prather recommended that the city supply additional funding to aid in purchasing the land.

Since the funds to purchase land need to be supplied upfront, it will be financed through a debt service that is to be chosen yet. A choice between finance plans at $30,000 per year for 10 years or $20,000 per year for 20 years was presented.

After evaluating them city treasurer Les Plotner agreed with Prather that it would be far better to choose the 10-year plan with much less of the funds going toward interest. That plan kicks in about $240,000 toward the land purchase.

"I had a lot of questions about this; I'm a lot more comfortable now," Plotner said. "It is doable. The $30,000 per year is handleable with the jobs this will bring in," he added.

The county made an informal commitment by straw vote at a special meeting the end of last month. They could not make a formal commitment outside a regularly scheduled meeting. Orr reported that their executive committee met earlier this week to work out how they will finance their portion, which is to go toward the purchase of land. They made a 6-0 approval on debt service financing. It is on their monthly business meeting agenda for final approval next Tuesday, April 19.

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The company, the city and county are putting a lot at stake. City attorney Bill Bates is watching for the city side that the agreements have adequate contingencies so that the returns will cover the city's commitments. This would include that the company does what they say they will do, such as hire the number of employees they say they will and maintain a certain employment level.

The city will also offer returning additional sales tax over $90,000 per year. This will cap at $190,000. Qualifying years would kick back up to $100,000 dollars per year to the company for the first 20 years.

Mayor Beth Davis was given approval to sign an agreement that will be faxed to the Illinois Department of Transportation this morning. IDOT has a 50 percent matching grant fund program that fits the site. However, it requires that engineering studies be performed as part of the grant application.

Green and Bradford, a firm specializing in that field and knowledgeable of that area of our town, has agreed to do the work. They will begin right away, but their contract will include a clause that allows that if the project doesn't go, the work can be stopped and payment will be only for work that has been completed.

The engineering plan and studies cost $149,000. If approved by IDOT, this fee will be included in the total infrastructure cost.

Aldermen approved all of the above plans.

Orr said that the company would like to break ground by July 1 and be up and running 10 months later. They are waiting on our offer to be completed. They have another site in Indiana they are considering but prefer Lincoln as their Illinois site.

Orr said that the company could make a decision in as soon as a couple of days.

[Jan Youngquist]

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