Would-be Naperville council members weigh in on Water Street financing
- Photos (1)
Naperville City Council members approved this site plan for the $95 million Water Street Development. Now developers and the city must figure out who's paying for it and how.
Rendering courtesy of Marquette Companies
Naperville City Council members have approved a site plan for the long-touted Water Street Development in downtown.
But some say a much tougher battle looms as developers assemble financing for the 2.4-acre development that will include a 166-room hotel, 71,000 square feet of commercial space, 26,000 square feet of office space, a 524-space parking deck, improvements along the south shore of the Riverwalk, and a pedestrian bridge.
Current council members say they're prepared for the developer to approach them with a proposal to rebate as much as $7.5 million in tax incentives for the roughly $95 million development.
As recently as Wednesday, Marquette Companies spokeswoman Deb Newman said the developer has yet to approach the city for financial backing for the project, which already sits in a specially created tax increment financing district.
"We are still assembling numbers based on the plan approved, which we will discuss with staff and then council in an effort to define proposed business terms," Newman wrote in an email Wednesday. "This will take several weeks."
Some believe the process may take much longer and carry past April's municipal election, in which four council seats are contested by 11 candidates. The Daily Herald Wednesday asked the candidates what their answer would be should they get elected and be faced with the decision to give $7.5 million in tax incentives back to the developer.
Kevin Coyne, who, as a planning and zoning board member supported the original site plan for the project, said the math would have to add up.
"I think the development will be great for downtown, but their projected revenue will have to clearly outweigh the amount of any award I would consider approving," Coyne said. "No one is going to be real cavalier about giving away taxpayer money in these times, so their numbers would have to be solid and concrete."
Wayne Floegel said he opposes any tax breaks for any developers
"I don't think we should be giving incentives to anyone," Floegel said. "And in this particular case, I believe it is much more of a want than a need for the developers."
Tom Glass also opposes such incentives.
"No. There's obviously a significant amount of interest for the project, so why are taxpayers being used as an open checkbook for the developer?" Glass said. "I believe in a level playing field for everyone. It's not government's role to pick the winners and losers."
Incumbent Paul Hinterlong confirmed that $7.5 million is the value "being whispered around city hall" and said he believes the next council ultimately will be responsible for the decision.
"As of right now, I don't know which way I would go. If they have good reason for it and it makes sense, I'll take a look at it," Hinterlong said. "But at first glance, I don't see the purpose of it. Typically we've given incentives for a reason, so I'd have to see exactly what they're looking for and make them sway me on it."
Fellow incumbent Doug Krause said he is "always willing to look at incentives" but doesn't think this project will merit them. Krause voted against approving the site plan Tuesday saying his traffic concerns were not addressed.
"The hotel has to perform in order for them to make the revenue, but is this viable? I don't know with all the traffic problems it's going to cause," Krause said. "And he (the developer) has a TIF. There's no other TIF in the city so he has a big advantage. All increases in valuation already stay right there."
When an area is designated as a TIF district, property taxes paid to local governments are frozen for up to 23 years. Any extra property tax revenues collected within the area after the date the district is established goes into a special fund controlled by the city. The money in the fund then can be used to help pay for certain improvements.
John Krummen said he will be "focused on the numbers."
"I do understand this will be a great boost to Naperville's economy, but you have to weigh cost and benefits," he said. "If the benefit comes out more positive and at less cost, I would be for it."
Jo Malik, who has not supported the plan, said she doesn't even need to see the numbers.
"My answer, without hesitation would be 'no," immediately because Naperville is not a bottomless bank," Malik said. "If they don't make their projections, I don't think that's a gamble we should be making. How do we give incentives to a group like this but not to all of the small businesses in the city?"
Dave Wentz said he does not want the city to gain a reputation as "offering handouts to every developer who comes to town with a plan."
"We ought to look at whether such a deal is actually seen as a financial necessity or is it showing some kind of preference?" he said. "Let's wait and see what their plan is and then decide if it makes sense for this to come together."
Candidates Judith Brodhead, Jeff Davis and Bill Habel could not be reached for comment Wednesday.
- Share Facebook Twitter
Article sent to (required)E-mail
Article sent from (required)E-mail Name
Subject Line (article title)
Message (optional)Success - Article sent Click to close
Interested in reusing this article?
Custom reprints are a powerful and strategic way to share your article with customers, employees and prospects.
The YGS Group provides digital and printed reprint services for Daily Herald. Complete the form to the right and a reprint consultant will contact you to discuss how you can reuse this article.Need more information about reprints? Visit our Reprints Section for more details.
Contact information ( * required )Name * Company Telephone * E-mail *
Article InformationTitle URL
Message (optional)Success - Reprint request sent Click to close