Two car dealerships are leaving Elgin, but that loss is expected to be partially offset by a new dealership coming to town, officials said.
Woody Buick GMC will be closing Saturday, while Elgin Toyota will be moving to Streamwood next year, their respective owners said. Both dealerships are on Chicago Street.
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Elgin Mayor David Kaptain said that a new dealership is negotiating a deal to open on Randall Road, but not at the auto mall. "They are well known. It's going to mid to large size," he said, declining to give more specifics.
Woody Buick GMC owner Stephen "Woody" Woodring said he's "heartbroken" about closing the dealership he opened in Elgin seven years ago. Woodring opened a new dealership in Naperville earlier this year, and said his initial plan was to run both dealerships.
However, he said, GMC required a $1.5 million upgrade to the Elgin building, and also indicated it would not be interested in keeping the Chicago Street franchise long-term, Woodring said.
Woodring said he tried to buy the property, but negotiations fell through. It wouldn't make sense to invest in upgrades without owning the property, he said. "It was strictly a business decision."
GMC will be putting the property up for lease July 1, Woodring said.
Meanwhile, Elgin Toyota will be moving to Lake Street in Streamwood next May or June after failing to secure adequate financial incentives to build on another site in Elgin, owner Bob Loquercio said. The 40,000-square-foot dealership opened in 1996. The new building in Streamwood will be about 70,000 square feet, he said.
Loquercio said he tried to work out a deal with Elgin for about a year; he declined to give specifics about financials.
Elgin City Manager Sean Stegall said Loquercio asked Elgin for about $7 million.
"That deal would cost the city more money than it would make (in sales tax revenues)," Stegall said. "That simply doesn't make sense."
Elgin offered $2 million in sales tax rebates after determining that area communities pay an average of $1.5 million for car dealership retention, Stegall said. "Based on our research, that was a very fair offer," he said.
Streamwood Village Manager Gary O'Rourke said the village board will consider, likely sometime next month, a sales tax rebate agreement of up to 50 percent in development costs or $6 million, whichever is lower. The board reviewed conceptual plans earlier this month.
Loquercio criticized Elgin's attitude toward business.
"They are going from pro-business to anti-business," he said. "All the rest of the communities, including Palatine, Elk Grove Village and others, have significant economic development programs for car dealerships."
"I think that's absolutely ridiculous," he said, adding he floated the idea of offering $4 million to Loquercio to stay in Elgin. "We offered to compromise."
Kaptain also pointed out that when car dealerships move to a new location, it's much easier for the new municipality to offer substantial incentives because of the influx of new sales tax revenues.
At a city council strategic planning meeting earlier this week in Elgin, Colleen Lavery, the city's chief financial officer, said she had yet to calculate the sales tax revenue loss from the two dealerships leaving town.
All car dealerships including auto parts stores and such represent about 40 percent of the city's sales tax revenues, officials said.