Don't risk a perception of favoritism

Lake Zurich was in a quandary.

An ambitious and controversial plan to raze and rebuild nearly all of Main Street through downtown was going nowhere, even after the village spent $27 million to buy land and launch the project.

Depleted village coffers, a housing slump and tightened bank lending policies, the trio that led Lake Zurich to declare five months ago that it was cutting ties with former downtown developer McCaffery Interests, made it difficult to attract a new player to restart the venture.

So last week Mayor John Tolomei and Barrington-based developer David Smith came up with "a unique funding manner," as Tolomei calls it, to get the work going again.

The village would give Smith's company, Equity Services Group, a $50,000 consulting fee. Equity Services Group would front the $216,000 cost of hiring a new architect to create a more detailed master plan for downtown. For six months after the plan was complete, Smith's company would get first dibs on any village-owned downtown site to propose a building project, subject to village board approval. And Smith's up-front costs would be repaid with fees that would be tacked on to every new downtown development.

Critics take issue with what they see as a too-cozy relationship between Smith and the village built into the proposal.

And they're right -- especially when Smith's other proposal is figured in. That project, two five-story lakefront condo buildings on a site known as Nestlerest Park, spawned yard signs and car-window placards protesting the height and density when it became public last month.

After moving though planning and zoning boards, Nestlerest eventually will wind up on the village board's lap for approval or rejection.

That, of course, is the same village board that'll vote on the new downtown proposal, probably at Monday's meeting.

It's easy to see how a yes vote on Monday could give Smith added leverage for Nestlerest's approval. Upset by a Nestlerest vote, Smith could walk away from proposing a project for any downtown building site. Eager to prevent such a scene, trustees could cast a more favorable eye on Nestlerest.

Tolomei says Smith could walk away anyway, and that village trustees won't let one issue influence the other.

The downtown development proposal never mentions Nestlerest, he says.

We think it should, to specify that the Nestlerest project be taken off the table for now as a condition of Smith's participation in downtown redevelopment. Otherwise, the potential for preferential treatment is too high.

And Lake Zurich's latest attempt at downtown redevelopment is too important for any of the players to be sidetracked by controversies over Nestlerest.