Navistar, state forge deal on Lisle move

Navistar is moving to Lisle. And this time it looks like the deal will stick.

Gov. Pat Quinn and Attorney General Lisa Madigan announced a $65 million incentive package for Navistar from the former Alcatel-Lucent building Navistar has been eyeing for more than a year.

News that Navistar would not be leaving Illinois, as it earlier had threatened, was met with a standing ovation from the assembled throng of business leaders and politicians.

The key concession from Navistar was the elimination of a controversial engine-testing facility at the company's new world headquarters.

Navistar will receive a state investment package that includes auto manufacturing tax credits and money to help train its employees.

Also, the city of Naperville is lending its bonding authority to the project - a move that essentially makes nearly $12 million of stimulus money available to Navistar.

"It's amazing what human beings can accomplish when no one worries about who gets the credit," Quinn said. "These are not Republican or Democrat jobs. These are American jobs."

The company plans to start moving to the 1.2-million-square-foot campus at 2600 Warrenville Road in about nine months, Navistar President Dan Ustian said. The building, known for its massive satellite dish-shaped facade, has sat empty since January.

About 500 engineering jobs would be filled immediately, Ustian said.

Navistar is headquartered in neighboring Warrenville at a facility of about 1,400 employees. The move allows the company to consolidate many of its white-collar positions and add about 1,600 jobs to the local economy. The refurbishing efforts and additional building will create another 400 construction jobs.

The company backed out of two previous proposed moves.

A key sticking point was Navistar's plans for the engine-testing facility, which nearby residents fought citing environmental and quality-of-life concerns.

Navistar officials said that testing probably will happen at its manufacturing facility in Melrose Park.

The conflicts with residents had led Navistar officials to plan to leave the state for the first time in the company's more than 100-year history. But the incentive package convinced them to stay.

In May, Madigan heard that Navistar had grown frustrated with the zoning process - which had empowered opponents to subpoena witnesses - in Lisle and planned to leave the state. Her office offered to try to negotiate a settlement between Navistar and its foes. She said Wednesday getting involved was an easy decision.

"In this miserable economy, the people have faced more than their fair share of problems," she said. "This was something that not only can we get involved in but we must do for the state of Illinois and the economy of our state."

In return for elimination of the engine-testing facility, an opposition group called Citizens for Healthy Development has agreed not to fight the company's efforts to create a special taxing district that allows the company to use some of its property taxes to pay for infrastructure improvements on the 87-acre property.

Lisle officials have estimated the tax district's value to be at about $20 million to the company during its 23-year life span.

"We had to put environmental issues above the financial issues," said MaryLynn Zajdel, one of the founders of the opposition group of residents who live adjacent to the proposed site. "The end result is something we all wanted."

Navistar still has to go through Lisle's zoning process, but that is considered a formality as village officials have been courting the company for nearly a year.

Don Sharp, Navistar's vice president of communications, said the company hasn't submitted the new plans to the village yet. But they call for three additions totaling about 25,000 square feet to the 1.2 million-square-foot campus. The company will invest roughly $110 million in improvements as well. Overall, Sharp said the company will invest about $205 million in Illinois.

"This is a historic moment," Sharp said Wednesday. "We achieved this milestone because we received incredible support across the board."

The additions include a showroom in the front of the building, a conference room adjacent to a vehicle storage area in the basement of the western parking garage and a 15,000-square-foot addition that will house creative departments.

Lisle Village President Joe Broda said the negotiated deal was a huge win for the village and the area.

"It's not only about Lisle," he said. "It's about what's good for every citizen in our county and the state of Illinois."

The company also plans to relocate its parts distribution facility somewhere in the Chicago area.

The incentive package also requires Navistar to remain in Lisle for at least 15 years, but Sharp said the company plans to stay longer.

Earlier this year, Naperville was designated a recovery zone, which gave the city the authority to provide business loans to encourage economic development.

Naperville officials, who approved their portion of the Navistar deal Tuesday night, said that their allocation will be combined with Rockford and other municipalities in the area to create a larger pool for Navistar.

"This program is one of the key reasons that they can make their finances work," City Manager Doug Krieger said. "We are not giving away money. If action were not taken on this, it would create a $14,000 hole for the city because we are being paid by Navistar for the ability to use it."

Navistar will pay Naperville almost $15,000 for the right to access the $12 million in incentive money.

One other hurdle remains. The county and Lisle must rework an intergovernmental agreement with the DuPage Forest Preserve District that calls for the county and village to pay the forest preserve $1.5 million for a ring road that runs around the northern perimeter of the property. The county and Lisle would then donate the road to the company in return for guarantees on job creation and length of stay at the new headquarters.

<p class="factboxheadblack">Highlights of the Navistar deal</p>

<p class="News">• No engine testing on former Lucent site.</p>

<p class="News">• State provides $65 million incentive package</p>

<p class="News">• Naperville provides $12 million in borrowing power</p>

<p class="News">• Adds 1,600 jobs to local economy, plus 400 construction jobs</p>

<p class="News">• Guarantees Lucent will stay in area for at least 15 years</p>

<p class="News">• New construction includes showroom, conference room and a 15,000-square-foot addition for Navistar creative departments.</p>

<p class="News">• Move-in planned in nine months</p>

<p class="News">Source: Navistar, state of Illinois </p>