Arlington Heights officials rejected a petition to ban village financial incentives for the Chicago Bears or any other business, saying the petition did not have enough valid signatures and warning such a move would hurt businesses and taxpayers.
The petition calls for the town to create an “Anti-Corporate Welfare Ordinance” that would prohibit any financial or other incentives for a business to operate in the town. The petition was filed by Americans for Prosperity Illinois, part of a libertarian group backed by the conservative Koch brothers.
Mayor Tom Hayes called the proposal “a terrible idea” and said it would ban any type of tax exemption or even public parking that could be seen as a financial incentive for businesses. He added that any suggestion of cronyism among village officials was “patently untrue and baseless.”
Last year, the Bears signed a preliminary purchase agreement to buy Arlington International Racetrack from Churchill Downs Inc. for $197 million. The team is conducting due diligence to see if the 326-acre site would meet all requirements before closing the deal late this year or early next.
Team officials have said they would not seek taxpayer help to build the stadium, but would need public assistance to build infrastructure for the $5 billion adjoining development to include housing, offices, retail and entertainment.
A village ordinance allows the village board to consider passing a referendum on a petition if it gets signatures in support of 1% of registered voters, or 557 people.
Americans for Prosperity Illinois submitted 667 signatures on September 6, but some signatures did not match the signatures on file, had no signature, had wrong or missing names, or the signers did not live in Arlington Heights, leaving only 544 valid signatures, Randall , village manager Recklaus said.
Petitioners can always add more signatures. If the board still rejects the proposal, petitioners can get signatures from 12% of registered voters to put the measure on the ballot.
Americans for Prosperity has said a referendum would be binding, but the town’s attorney, Hart Passman, said no, saying nothing in the ordinance or state law makes it binding.
Recklaus provided an overview of how tax incentives have been very successful in attracting and retaining businesses that reduce the property tax burden of homeowners.
More significantly, he said, the village center was successfully rebuilt through a Tax Increment Financing, or TIF, district. Under the TIF, any increases in downtown property taxes were spent on area improvements, such as utilities and roads.
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While the TIF was in effect from 1983 to 2006, annual property tax revenues increased from $650,000 to $6.5 million, he said. Once the TIF expired after 23 years, that money was distributed to all the local tax agencies.
The result has been a thriving downtown, with high-rise condominiums and apartments, restaurants, a theater, and three public parking areas. An incentive ban could even be interpreted as a ban on public parking and to eliminate the use of village streets for downtown outdoor dining, Recklaus said.
Other village programs have provided sales tax rebates and low-interest or forgivable loans to help businesses survive the COVID pandemic or other challenges.
In the Bears’ case, a TIF could pay for new culverts and other infrastructure, such as proposed new ramps to carry traffic from Illinois Route 53 under Northwest Highway and railroad tracks to the stadium.
While some TIF and stadium projects elsewhere have failed, Recklaus said, any new Arlington Heights TIF would only pass if it is shown that it would generate revenue to pay for all of the village’s expenses. Prohibiting such deals would put the town at a severe competitive disadvantage and would likely lower its tax base.
Americans for Prosperity released a recent poll that found 68% of Arlington Heights voters opposed using tax dollars for the Bears, compared to 22% in favor. The poll also found that 55% supported the anti-corporate welfare ordinance.
The group’s deputy state director, Brian Costin, previously issued a statement saying: “Arlington Heights is proposing the largest corporate welfare deal in Village history for a billionaire owner in the world’s richest sports entertainment company. Not only is this special treatment unfair to residents and other business owners, but a large majority of economists surveyed on sports stadium subsidies considered them to be a bad deal for taxpayers.”