Grainger facility comes full circle in Mettawa

The tiny rural enclave of Mettawa has snared W.W. Grainger, a Fortune 500 company, as an official corporate resident and is buying some of its property in a deal that has been two years in the making.

Altogether, land purchases and a separate economic incentive agreement account for an overall package of nearly $12.6 million in what is regarded as one of the biggest events in town since Mettawa was incorporated in 1960. Actions taken this week by the village board annex the industrial supply giant's 152-acre property, which includes its corporate headquarters and 2,100 employees, and provide for the purchase of 114 acres of Grainger property.

"We had a good night Tuesday," Mayor Casey Urlacher said of the unanimous vote to annex. "It's exciting news for everyone."

The parties began talking about two years ago regarding the potential sale/purchase of unused Grainger properties on both sides of Riverwoods Road just north of Everett Road, officials said.

Those properties, totaling about 100 acres, were already in the village and subject to a 1998 annexation agreement that allowed up to 26 residential lots.

After several meetings, the discussion was extended to include a 14-acre vacant Grainger property at the southwest corner of Route 60 and Riverwoods Road and the possibility of annexing the corporate headquarters.

"To call our village home is pretty significant," Village Administrator Bob Irvin said.

In recent months, various documents were drafted, including an annexation agreement, land purchase agreement and an economic incentive agreement.

"They were very polite and helpful and just wanted to work with us," Irvin said. "It's evolved into an economic incentive agreement where we'll share the sales tax."

To buy the property, the village will use $2 million in reserves and borrow $3.8 million. The village will receive 100 percent of the sales tax until all costs associated with the loan, including principal and interest, are paid, Irvin said. "We think in four to five years it will be paid off," Irvin said.

When that point is reached, Grainger will receive 100 percent of the sales tax generated until it has received $6.78 million. The agreement then calls for the village and company to equally split the sales tax for 20 years.

Mettawa prides itself on the acquisition and stewardship of open space.

"We'll keep it as open space. We don't have any plans to develop it," Urlacher said of the 114 acres acquired from Grainger.

Company spokesman Joseph Micucci said the company bought more land around its headquarters than needed.

"As the company has been reviewing its cost structure and asset base, it determined we no longer need to retain 114 acres of undeveloped land," he said.

The agreements represent a change from the early days when Grainger came to town.

"It's a full circle," said longtime Trustee Mary Brennan.

Originally, its headquarters was in the village but was deannexed after a zoning dispute.

"The (village) board at the time didn't want any commercial activity in Mettawa," Brennan said. "Finally, Grainger had it and said, 'We're going to annex out of the village and go to Lake County.' "

The actions will result in a sales-tax loss for the county, but specific information was not available and an analysis hasn't been done.

Mettawa has about 550 residents but some big-time corporate residents, including Costco, which opened in late 2010, Brunswick Corp., AbbVie and Vyaire Medical.

Brennan said the Costco proposal at the time divided the community but has been a boon.

"Costco, now this," she said. "It's a great thing. The village is very financially sound."