Caterpillar sale, repair center planned for East Dundee

  • Altorfer Inc., a Caterpillar dealer, has proposed building a sale and repair center on the east side of East Dundee.

    Altorfer Inc., a Caterpillar dealer, has proposed building a sale and repair center on the east side of East Dundee. Courtesy of the village of East Dundee

Updated 6/6/2020 5:59 PM

East Dundee is offering roughly $2 million in tax incentives to facilitate the construction of a new Caterpillar sale and repair center on the east side of town.

The $15 million facility is slated to be built just south of Route 72 and Christina Drive, where trustees this week approved annexing 38 acres of previously unincorporated land into the village.


Altorfer Inc., an Iowa-based dealer of Caterpillar parts and equipment, plans to vacate its existing Elmhurst location and move portions of that operation to four different towns, including East Dundee, President Derek Altorfer said. The development will occupy about 23 acres, which also allows for future expansion in accordance with the company's long-term growth plans.

"We feel this new location will open up ... a new customer base we haven't been doing business with in the past," he said. "As we learned more about the location, more about the village, everything about it really lined up with what we were looking for."

Altorfer is expected to acquire the development site from Plote Property Management, the leaders for which called the project a "huge win on all sides."

Of the remaining land annexed into the village, 3 acres will be donated for a right of way, and 12 acres will go toward intersection improvements and the extension of Christina Drive.

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East Dundee officials are pursing an eligibility study to incorporate the Caterpillar project into the business development district, and either extend an existing tax increment financing district or create a new one.

The village could then enact a development deal through 2031 that calls for reimbursing Altorfer for 60% of the TIF revenues generated at the site, capped at $1.52 million, documents show. In a TIF district, property taxes above a certain level are funneled into development rather than to local governments.

The village also would pay back all business development district sales tax dollars generated by the project -- an estimated $500,000.

Even with those rebates, East Dundee officials anticipate collecting $870,000 in TIF revenue over the next decade, plus an annual $300,000 in sales taxes.

"We could not be more proud to have Caterpillar in East Dundee," Village President Lael Miller said. "This is going to be a lifelong partnership."

The village board is expected to consider Altorfer's rezoning and variance requests at an upcoming meeting. The company is on a "strict timeline" and hopes to begin operating within the year, Village Administrator Jennifer Johnsen said.

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