Elmhurst OKs tax incentives for motorcycle dealership

The Elmhurst City Council overwhelming approved a measure to provide $500,000 in tax incentives over 12 years to motorcycle seller iMotorsports to expand and redevelop a formerly blighted site on Grand Avenue in Elmhurst.

The council voted 11-1 Monday night to provide iMotorsports with $100,000 up front to help with building and renovating the site.

The money will be personally guaranteed by the business owner in the event the business fails or the contract is breached, Alderman Michael Honquest said.

"It's a very good structure to the transaction - protecting the city, protecting the business," he said. "I think that sets the table to move this forward."

But Alderman Michael Bram, who cast the lone dissenting vote, disagreed. He said the business is doing well without the tax incentive and doesn't need the money. He said the $100,000 in upfront money isn't a good deal for taxpayers.

"Essentially it's a $100,000 interest-free loan," he said. "It's too rich for my blood, so I cannot support it."

The deal calls for sales taxes to be split 50-50 beginning Jan. 1, 2018, between iMotorsports and the city, with the initial portion of iMotorsports share going to repay the $100,000 upfront money. The agreement calls for iMotorsports to complete renovations at the site by the end of next June.

The company, which sells used motorcycles, moved from Roselle and opened for business at 334 W. Grand Ave. in Elmhurst on April 1, 2014. The site was formerly a Suzuki auto dealership.

The city began its relationship with iMotorsports in May 2014 when it agreed to a 10-year, 50-50 sales tax split up to $250,000 to help develop the site. The agreement contained a provision to revisit the terms if a major manufacturer considered iMotorsports for a dealership.

Polaris Industries, a Minnesota-based company that manufactures a brand called Indian Motorcycle, has approved iMotorsports for a dealership. That agreement requires iMotorsports to complete a $1 million showroom expansion and to renovate its parts and service department in addition to hiring additional employees in Elmhurst.

The new dealership must be open for business in spring of 2018, according to the agreement.

iMotorsports is outperforming the 10-year projections from the 2014 agreement with $12 million in sales in 2016, according to a city council document. In addition to used motorcycles, the company now sells a three-wheel motorcycle called Slingshot, also manufactured by Polaris Industries.

Honquest was upbeat about how the deal will impact the city.

"For us, it's new jobs," he said. "It's new tax revenue."