Wheeling trustees reverse course, will give Prairie Park $6 million
The struggling Prairie Park development in Wheeling got new life on Monday when a majority of the village board backed giving developer Mark Smith an additional $6 million.
The money would come from tax increment financing funds, and if approved would bring the village's total contribution to the project up to $10.5 million.
"I bounce back and forth on this, but if this project fails, our taxes will go down and the value of that land will go down," said Trustee Dave Vogel. "We have to do what we need to do to move forward."
Trustees only discussed the financing on Monday. The item will now be placed on a future agenda for an official vote.
However, based on Monday's discussions, Smith will get his money.
Besides Vogel, trustees Dean Argiris, Robert Heer and Ken Brady supported giving Smith the $6 million. Trustees Ray Lang and Pat Horcher voted against the idea.
Village President Judy Abruscato abstained because she's employed by MB Financial, the bank in charge of the project's financing.
When Smith addressed trustees on Monday, he said of the $6 million, $2.5 million would finish site improvements. The remaining $3.5 million would be performance based, meaning he'd get the money only as he sold new units.
"In tough times, people pull together to help each other out," he said.
Smith said he has invested more than $80 million in the project so far. He has sold 161 units along north Wolf Road, while another 79 remain unsold.
Smith's attorney, Paul Nicolosi, said the $6 million will keep the project out of foreclosure.
"At the end of the day, this project is only successful if the remaining 79 units are sold," said Nicolosi, who pointed out that Smith is taking a risk with this new agreement. If he can't sell 10 units in the next 18 months, Smith will hand the project's deed over to the bank without a legal fight, Nicolosi said.
Prairie Park's clubhouse will also be built - possibly before the end of the year - if Smith gets his $6 million, Nicolosi added.
Lang said giving Smith the money will hurt other developments, such as the Wickes site, because that money won't be available for future developers.
"I can't put all our eggs in one basket," Lang said.
In 2003, Smith received $3 million in TIF funds to build 306 high-end condo units in five buildings. In 2006 Smith asked for and received an additional $1.5 million to cover the rising cost of materials.
Smith asked the board for an additional $3 million in October and August 2009. He was denied both times.
The August meeting was particularly tense, as police broke up a crowd that verbally attacked some Wheeling board members who voted against giving developer Smith the money.
After the vote, Smith quickly left village hall with his wife, Vivian. About 20 Smith supporters followed the couple out of the meeting, some loudly accused trustees of not fulfilling promises made to the Smith family, and others vowed not to vote for some trustees in the next election.