Hoffman Estates expands 6% entertainment tax to include family center
Hoffman Estates officials Monday expanded the list of taxable activities under the village's 6 percent entertainment tax from what had been mainly performances at the Sears Centre Arena to all the games that will be played at a family entertainment center expected to open next year.
The tax generated by the Main Event family entertainment center to be built next to the Sears Centre is expected to generate money for Hoffman Estates' general fund as well as up to $750,000 toward the business' construction.
Mark Koplin, Hoffman Estates' assistant village manager for development services, said no other existing businesses will be affected by the change in the tax. But some future businesses that locate in the village's entertainment district near the Sears Centre north of the Jane Addams Memorial Tollway and west of Route 59 might be.
Koplin said the tax stretches all the way back to the Poplar Creek Music Theater that operated from 1980 to 1994.
Dallas-based Main Event Entertainment plans to build a 49,000-square-foot building next to the Sears Centre that will include space for 22 bowling lanes, laser tag, a ropes course, billiards and more than 100 different video games. All of these activities are now eligible for the 6 percent entertainment tax.
But similar activities elsewhere in the village, like bowling at Poplar Creek Bowl, will not be taxed because they lie outside the entertainment district around the Sears Centre.
The Main Event family entertainment center is expected to generate more than $250,000 in entertainment taxes annually.
Under a 10-year agreement, Main Event will not have to pay any entertainment taxes during its partial operating year of 2016. After that, it will pay an increasing threshold amount to the village before receiving any refund above that.
In 2017, the threshold is $200,000.
It increases by 2 percent annually until it reaches $240,000 in 2025.
The amount above the threshold the village would refund Main Event is 75 percent in 2017, 50 percent in 2018 and '19, 40 percent in 2020, 30 percent in 2021, 25 percent in 2022, 15 percent in 2023, and 10 percent in 2024 and '25.
The refunds stop if Main Event has received $750,000 before the end of 2025.