Bears would pay $3.6 million a year, under proposed Arlington Park property tax settlement

The Chicago Bears would pay $3.6 million in property taxes a year at the sprawling Arlington Park property until construction begins on a stadium, under terms of a proposed agreement released Thursday by Arlington Heights officials.

The 12-page memorandum of understanding — brokered by village officials over the last year and a half of negotiations — aims to resolve a protracted tax dispute between the NFL franchise and three Arlington Heights-area school districts whose boundaries cover the 326-acre site purchased by the team in 2023.

The deal must still be approved by the boards for Arlington Heights, Northwest Suburban High School District 214, Palatine-Schaumburg High School District 211 and Palatine Township Elementary District 15. All the elected panels meet next week.

When the tentative agreement was announced last week, the Bears said the parties were aligned on a framework for potential future development planning, financing and property tax certainty at Arlington Park, though cautioned they’re still focused on trying to build a new stadium on the Chicago lakefront.

Under the proposed settlement, the final tax bill in Arlington Heights is based off a property value of $124.7 million — the number that was set by the Cook County Board of Review last February. The football club purchased the site for $197.2 million a year earlier.

But instead of being assessed at 25% of the fair market value — the common commercial standard in Cook County — the site would be considered “unimproved” real estate now that all buildings from the old horse racetrack have been demolished, and given a 10% assessment level, according to the agreement.

That would give the Bears a lower tax bill than the $8.9 million the organization is expected to pay for the 2023 tax year.

Village officials confirmed the agreement pertains to 2024 and beyond, and doesn’t resolve the Bears’ appeal of the 2023 bill, which is still pending before the Illinois Property Tax Appeal Board.

The team had requested the property value be reduced to as low as $60 million, which would yield a tax bill of $1.7 million.

The short-term property tax settlement calls for an annual $3.6 million tax bill from 2024 through 2027, and it could remain the same amount in the following years if the Bears submit formal plans seeking zoning approval and then apply for building permits to begin construction, the agreement states.

But if the Bears don’t meet those milestones, the property value would be tied to annual increases in the Consumer Price Index between 2% and 5%.

The deal becomes null and void if any legislation, budget or appropriation of funding is approved for a new Bears stadium outside of Arlington Heights. And the memorandum only applies if a stadium is built at the shuttered racetrack property — not for any other type of development the Bears or others may pursue there.

Before touting a proposal earlier this year for a publicly-owned stadium south of Soldier Field as part of a $4.7 billion Museum Campus redevelopment, the Bears in 2022 unveiled plans for a $5 billion mixed-use, transit-oriented development at Arlington Park. It would be anchored by a domed stadium, with hotels, a fitness center, sportsbook, hall of fame, performance venue, restaurants, other retailers, homes, parks and open space.

Besides the tax issue, the memorandum requires the Bears to resume economic, traffic and other studies related to the Arlington development, and then diligently refine its conceptual site plan.

The parties also agree to lobby Gov. JB Pritzker and legislators for the long-term property tax break the Bears first sought for Arlington Park in 2022. Called Payments in Lieu of Taxes, the financing mechanism would freeze the assessment between 23 and 40 years, and allow the Bears to make negotiated payments to the village, schools and other local units of government.

Such an arrangement would also be subject to approval of a local review board of those taxing bodies, and the deal wouldn’t take effect until stadium construction begins.

The memorandum also contains a formula to cover schools’ additional operating costs for students who may reside in new homes on the site.

Funding for additional classroom space, building additions, and possibly even a new school could come from a tax increment financing district, residential development impact fees, or direct payments from the Bears, developers or homeowners, the memo says.

It also calls for a community benefits agreement that could include use of the stadium for schools’ games and graduations, and student internships.

The agreement will be considered by the Arlington Heights village board during a special meeting at 7 p.m. Monday, followed by votes of the District 15 board Wednesday, and the District 214 and 211 boards Thursday.