Schaumburg sets new policy on recommending tax breaks, renewals
Schaumburg trustees this week set a tough stance on the possibility of recommending second renewals of a Cook County tax break for industrial properties that cuts their property taxes nearly in half for a dozen years at a time.
They also established a policy for recommending a similar tax break for commercial buildings like restaurants which they employed for the first time earlier this year for a planned $2 million remodel of the former Ram Restaurant & Brewery building to create the Blue Martini Lounge on McConnor Parkway north of Woodfield Mall.
Trustees increased the application fee for all such incentives from $105 to $500.
But it was their conversation about second renewals of the Class 6B incentive -- which would grant qualifying industrial businesses a 25th through 36th year of the tax break -- that took the most time.
Trustee Marge Connelly said she believes 24 years of such an incentive is enough outside the rarest of circumstances and that every property tax dollar not paid by a qualifying business is one that must be paid by other property owners.
Trustee Frank Kozak said he agreed that any business ought to be solvent after such a long time in operation.
The intent of Cook County's 6B incentive for industrial properties and 7A incentive for commercial properties is to make blighted or long-vacant business sites financially competitive with the collar counties for redevelopment.
To qualify for a 6B in the first place, for instance, an industrial property must have been vacant or on the market for at least two years.
While it's the Cook County Board that approves such incentives, applications must be accompanied by a recommendation from the municipality.
In 2015, Schaumburg trustees established specific criteria for their recommendation of a first renewal of a 6B. This time, they rejected staff's proposed criteria for recommending second renewals, preferring to address such requests on a case-by-case basis.
But even though the toughness of their second-renewal policy is now more general than specific, Connelly said it should be clear that only significant reinvestments in property yielding substantial economic benefit for the village will be considered.
"I don't want people's business expectations to be that these will be easy to get," she said.
Schaumburg recommended its first 6B tax breaks in 1988, and made its first renewal recommendations in 2007. The new policy anticipates requests for some second renewals in the near future, Schaumburg Economic Development Director Matt Frank said.
The incentive reduces the level of assessment on a property from 25% to 10% -- effectively cutting property taxes in half -- for the first 10 years. The level of assessment then rises over the next two years before returning to normal.