Buffalo Grove adds $1.75 million to incentive deal with electrical company

Buffalo Grove will provide up to $1.75 million in new economic incentives to an electrical equipment supplier planning to double the size of its facility in town and hire 80 to 100 more workers.

Under a measure approved by the village board this week, a 2011 deal that paved the way for Connexion to move into its 60,000-square-foot warehouse at 1700 Leider Lane will be extended seven years and the cap on the incentive will rise from $500,000 to $2.25 million.

Buffalo Grove officials say the village expects more than $7.5 million in revenue through Connexion's sales during the term of the seven-year agreement.

Village Manager Dane Bragg said the incentive will help offset the company's "pretty substantial expense" to expand its business, which includes a 63,000-square-foot addition to its Leider Lane facility.

"In terms of their regional scope, they were not only looking here, but also looking across state lines potentially at other locations," Bragg said. "So it was pretty critical that we were able to put together a deal that balanced out their costs and yet also secured a revenue generator for the village."

Under the incentive plan, the village will share a percent of sales tax revenues generated by the company every year until 2022, but only after the Buffalo Grove receives a minimum $162,000. The percent shared above that starts at 80 percent in the first year, then falls to 70 percent in 2017, 60 percent in 2018 and then 50 percent in the final four years.

The agreement also establishes penalties if Connexion leaves Buffalo Grove or terminates operations during the next seven years. The company would have to pay back all the incentive money if that occurs in the first five years of the deal, and then $750,000 in year six and $350,000 in year seven.

Bragg said Connexion distributes electrical products, including LED lighting and some solar and wind energy goods.