Should Vernon Hills give tax incentive for Hawthorn Mall plan? Public gets its say

  • A public hearing is the last step before Vernon Hills officials decide whether to designate the Hawthorn Mall property as a tax increment financing district as an incentive for a planned $250 million redevelopment.

      A public hearing is the last step before Vernon Hills officials decide whether to designate the Hawthorn Mall property as a tax increment financing district as an incentive for a planned $250 million redevelopment. Paul Valade | Staff Photographer, March 2020

 
 
Updated 10/5/2020 8:04 AM

Some key details -- such as the amount of tax incentive to be provided -- are still to be determined, but a milestone will be reached Tuesday in the long and deliberate process to reinvent Hawthorn Mall in Vernon Hills.

A public hearing will be held at 6 p.m. at village hall, 290 Evergreen Drive, as the final requirement before the village board decides whether to designate most of the mall property as a tax increment financing district. That vote could come later this month.

                                                                                                                                                                                                                       
 

Village officials agree the aging mall, a key sales tax generator, needs to be upgraded. A TIF district is the mechanism that would allow a proposed $250 million makeover to proceed.

A TIF district is a sometimes-controversial development incentive in which property tax disbursements to schools, libraries and other local governments are frozen at current levels. Any additional tax revenue generated by rising property values goes into a special fund to pay for improvements within the district.

On Tuesday, Kane, McKenna and Associates Inc., the village's consultant in the TIF process, will give a brief overview of the factors that make the 63-acre area eligible for the designation. That will be followed by public comment.

No decision will be made Tuesday, but both the village and a community group have disseminated information in advance of the public hearing, including links to studies, meeting videos and other details that brought it to this point.

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"This truly is an opportunity to learn more and ask more (questions) and express your opinion," said Karl Borchers, a village resident and founding member of Residents Supporting a Successful Redevelopment of Hawthorn Mall, a Facebook group with more than 800 members.

Borchers said the group is not affiliated with anyone promoting or opposing the mall redevelopment, but is a way for informed residents to share what has been learned with neighbors.

"We're not against the TIF," he said. "It's more of an educational effort."

"Part of it is being mindful of how that will impact the rest of the community and help us understand what's the same and what's different," Borchers added.

Comments also can be sent to Village Manager Mark Fleischhauer, mfleischhauer@vhills.org, by 4 p.m. today.

Dallas-based Centennial Real Estate bought the mall as a long-term investment and over the past two years has outlined a vision to reinvigorate the property.

                                                                                                                                                                                                                       
 

The proposal, which includes hundreds of housing units, a grocery store, restaurants, elaborate public gathering spaces and other potential uses will require financial assistance, Centennial has emphasized.

The TIF designation would affect several taxing bodies, including Hawthorn Elementary School District 73. School officials had initial concerns but now are expected to support the TIF designation at the public hearing.

Representatives from the local taxing bodies met in late August as a Joint Review Board and recommended the TIF district, with District 73 and Lake County voting against.

The meeting is on the village's YouTube channel.

Hawthorn is considered the centerpiece of the village's large commercial base, but like many other retail centers has been in decline. Two of the four anchor stores have closed and about 45% of the 1.27 million-square-foot mall is either vacant or subject to short-term leases, according to the TIF study.

Fleischhauer said Tuesday's hearing will only involve the establishment of the TIF district.

"It has nothing to do with the financial details," he said.

Those elements are being negotiated and eventually will be outlined in a redevelopment agreement with Centennial.

"We're not even close on that," Fleischhauer said.

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