Agenda Date Requested: September 8, 2009
Action Requested: APPROVAL TO ENTER INTO A TIF REDEVELOPMENT AGREEMENT WITH D & B DEVELOPERS, LLC AND AUTHORIZE THE INTERIM CITY MANAGER TO EXECUTE THE NECESSARY DOCUMENTS. THIS PROJECT IS LOCATED IN THE WAREHOUSE DISTRICT TIF. (COUNCIL DISTRICT 1)
Background: Darren and Becky Frye the owners of Water Street Solutions established D & B Developers, LLC to redevelop the old Peoria Post Office into a modern office building to house their business Water Street Solutions. Water Street Solutions operates in eight states with Peoria, IL being its headquarters. The company was founded in 1987 by local owners Darren and Becky Frye, to change agriculture one farmer at a time.
Water Street Solutions provides education and financial counseling through their online Water Street University courses and small forums. The Producers’ Kitchen Table allows them to coach producers to reach their true potential as Americas most important business men and women. In 2006 Water Street Solutions employed six. Today they have 76 full time employees and anticipate hiring 20 more this year. They plan on hiring additional employees over the next three years resulting in a total of 200 jobs located in the Warehouse District.
The Redeveloper plans to reconstruct the old Peoria Post Office building located at 601 S.W. Water St. They plan to take the existing warehouse and convert it into a modern two story office building that will have 19 offices, 2 conference rooms, 1 board room, and a common area with 76 cubicles. They also plan to construct an employee lounge and a training room that will seat approximately 50 people. Other features include an exterior deck that faces Water Street and a “green habitat” entrance way.
The Redeveloper will also design, bid and construct Walnut Street to City specifications/requirements and be reimbursed by the City on completion.
Financial Impact: D & B Developers are asking for a TIF Redevelopment Agreement with a 50/50 split of the property tax for the life of the TIF. Conservative estimates indicate property tax on the increment would result in a total of $1,529,825 over the life of the TIF with $764,912 going to the City for infrastructure improvements (Exhibit A).
The property is located in the Enterprise zone and the company is eligible to receive the sales tax exemption on building materials that is estimated to be $156,000; the City’s portion being $48,750.
NEIGHBORHOOD CONCERNS: There are no neighborhood concerns.
Impact if Approved: The City will enter into a redevelopment agreement with D & B Developers, LLC which will provide them with an incentive to redevelop and renovate the property. The redeveloper will receive 50% of the property tax increment over the life of the TIF and the City will capture the remaining 50% of the property tax increment to utilize for infrastructure improvements.
Impact if Denied: The City will not enter into the redevelopment agreement and the City will not capture the property tax for infrastructure improvements.
RELATIONSHIP TO THE COMPREHENSIVE PLAN: This project assists in achieving both the vision and goals of the Comprehensive Plan as follows:
Chapter 5 ECONOMICS--VISION: A HEALTHY, THRIVING ECONOMY; and GOAL: A.1. Provide an economic environment that supports existing and new businesses. A1.8. Consider providing public money to encourage private investment.