Despite the objection of one commissioner, the Downers Grove Village Council has agreed to share a portion of the village’s sales-tax revenue with a major garden catalog retailer as an incentive for the company to open its first Chicago-area retail store at a long-vacant site in town.
The council, in a 4-1 vote this week, authorized a deal with Philadelphia-based W. Atlee Burpee & Co. that offers a rebate of 70 percent of the village’s share of the sales taxes that would be generated by the store for five years and 50 percent of its share of sales taxes for the following five years, according to Village Manager Mike McCurdy. As part of the offer, the village would renew the deal for an additional 10 years at Burpee’s request.
Officials have said the rebates are being offered to assist Burpee, among the nation’s largest catalog retailers of seeds, plants and garden products, with the renovation of a deteriorating structure that has stood vacant for about five years at 1100 Ogden Ave., adjacent to Jewel-Osco. The company is planning to convert the 28,000-square-foot facility into its first Chicago-area retail store, which would feature a conservatory, a computer area for customers to design their own gardens, a coffee shop and a bookstore.
Burpee representatives on Thursday still were ironing out some details to sublease the property from Jewel, according to Bill Clark, Burpee’s assistant to the president. Once the documents are executed, construction will begin immediately, Clark said. The company anticipates a store opening in mid-March.
Over the 10-year period of the deal with the village, Burpee would receive an estimated $304,300 in sales-tax rebates. The village would collect roughly $216,700. Those estimates are based on company sales projections. In all, the company could stand to receive an estimated $676,300 in sales-tax rebates over 20 years. The village’s share would be roughly $588,700.
Village Commissioner Marilyn J. Schnell voted against the deal. On Thursday, she said the offer puts existing local businesses at a competitive disadvantage and might open a Pandora’s box, resulting in a rash of requests for such rebates.
She reiterated concerns with the village deviating from a standard included in a villagewide economic inducement policy intended to attract new businesses or retain and expand existing ones. The policy states that a business must generate a minimum of $100,000 in new sales-tax revenues per year for the village in order to receive sales-tax rebates.
“Its not a level playing field for our businesses. It sets a dangerous precedent to offer rebates to businesses that do not generate large sales taxes,” Schnell said.
Other village officials have said the site is an exceptional case because of its “blighted” condition.
