Incentive helps lands FedEx in Grayslake

  • Tom Beeman, FedEx Ground managing director of the Midwest district, announces the new FedEx Ground facility that will go up in Grayslake. The announcement was made Friday during a news conference at Lake County Central Permit Facility in Libertyville.

    Tom Beeman, FedEx Ground managing director of the Midwest district, announces the new FedEx Ground facility that will go up in Grayslake. The announcement was made Friday during a news conference at Lake County Central Permit Facility in Libertyville. Steve Lundy | Staff Photographer

 
 
Posted6/26/2010 12:01 AM

FedEx Ground has chosen Grayslake for its fourth Chicago-area distribution facility in a deal that required the cooperation of several public agencies and a tax incentive worth nearly $1.2 million.

The project, the first to be solely located in what is known as the Central Range, eventually would result in more than 700 jobs and represents a victory over Wisconsin, which has siphoned jobs from the area in the past few years.

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"We were able to provide incentives that gave us the competitive edge," Lake County Board Chairman Suzi Schmidt said during a news conference Friday to introduce the project.

Construction of the $38 million sorting and delivery center on Route 83, north of Peterson Road, could begin later this summer and open in late 2011.

It would join facilities in McCook, Carol Stream and Wheeling to incorporate automated sorting equipment, as the company continues a growth and expansion surge.

"This is part of our strategic project to accelerate the speed of our network," said Thomas Beeman, managing director of the company's Midwest district.

The company has added nine hub facilities since 2002, including one last year in Bedford Park.

The prospect of jobs and the anticipated power of FedEx to trigger a chain reaction of other businesses coming to the area convinced several entities to forego half of their expected property taxes for five years. FedEx Ground is the small-package unit of FedEx Corp.

                                                                                                                                                                                                                       
 

Grayslake High School District 127, Fremont Elementary District 79, Grayslake Elementary District 46, Lake County, the village of Grayslake and the Grayslake Fire Protection District will participate in the pact.

"The unemployment numbers for Mundelein alone were 14 percent a couple of months ago," said Lake County Board member Diana O'Kelly. "We have so many people who are unemployed and we need these jobs."

Forty construction jobs would be created to build the 214,000-square-foot facility, which initially would employ 200 full- and part-time workers.

At full capacity, an estimated 496 (448 part-time, 48 full-time) would work in the plant and 192 truck drivers would be needed.

Because the 40-acre site has been vacant, property taxes have been virtually nil. The argument is half of something for five years is better than nothing.

                                                                                                                                                                                                                       
 

Once it is up and running, the facility is expected to generate more than $555,000 in property taxes, which are divided by the entities to varying degrees.

Steven Anderson, president and CEO of Lake County Partners, the county's development arm that pursued and sealed the deal, said FedEx originally considered 16 sites. The list was narrowed with Genoa, Wis., as a chief competitor.

"We were competing against a Wisconsin package. That's the reason for those incentives," he said.

The company also is pursuing an incentive from the state, he said.

Anderson said he personally dislikes incentives, and several companies requesting them have been denied because they weren't justifiable.

"You have to create a return for the taxpayers," he said.

Besides the incentive, FedEx liked the location, work force and other factors, according to Anderson. The decision is a boost for Lake County, he added.

"If it wouldn't have been FedEx now, it wouldn't have been anyone for two or three years," Anderson said.