The City Council recently voted to reimburse Laura Buick GMC $224,944 in equal installments over an eight-year period for the construction of an additional parking lot at the car dealership on N. Bluff Road (Illinois Route 157).
Collinsville City Hall / Photo by Roger Starkey
The money, which will come from Tax Increment Finance funds, represents 25 percent of the total cost of the lot. The dealership underwent a major renovation in 2012 and has experienced increased sales. The new parking lot is to accommodate increased inventory.
The City and Laura Buick GMC entered into a redevelopment agreement in 2012 to help the dealership pay for the more than $3 million overhaul needed to meet new General Motors Co. appearance requirements for dealerships. In the deal, the City agreed to pay Laura Buick GMC the TIF revenue the dealership generates above $22,527 each year, for 10 years, with a maximum payout of $701,934. The $22,527 figure represented the amount the City received from the dealership, Paul Mann, City of Collinsville economic development director at the time, said.
Mann estimated the City would pay $508,000, but the amount was subject to change based on the value of the property at 903 N. Bluff Road. The $310,770 assessed value of the property has not changed since tax year 2010, according to Madison County records, but is expected to rise. Assessments are performed on a four-year cycle. The property will next be assessed this year, a spokesperson for the Collinsville Township Assessors office said.
City of Collinsville Finance Director Tamara Ammann said the first scheduled payout from the 2012 agreement is at the end of 2014.
The recent agreement is a modification to the 2012 redevelopment agreement and passed the City Council by a 3-2 vote, with Mayor John Miller casting the tiebreaking vote. Nancy Moss and Karen Woolard voted against the measure.
Councilman Mike Tognarelli said the decision was difficult. The process started a couple of months before the April 28 vote, Tognarelli said, and involved the City Council requesting more supporting documentation from Laura Buick GMC than they were legally required to supply. Sales tax revenue numbers from the dealership were given to the Council.
“They are the only car dealer I know of that has provided that information,” Tognarelli said. “We can get information from the State of Illinois, but it isn’t exact.”
Tognarelli declined to provide exact financial information, but said the eight-year agreement would pay for itself in a couple of months.
Woolard said the purpose of TIF is to encourage growth in blighted or underperforming areas.
“I don’t see Laura Buick as being underperforming,” Woolard said.
Tognarelli said he believed the City Council should support businesses that have proven they can be successful.
The potential to skew the competitive advantage also contributed to Woolard’s vote against the deal, she said.
“I’m concerned that giving this amount of money to one car dealership would give them an unfair advantage over the other car dealers in town,” Woolard said.
Miller called the decision a “no-brainer,” noting that the city once had six new car dealerships, but now has only two. Jack Schmitt Ford Lincoln is the other new car dealer in Collinsville. There are four used car dealerships within the city limits.
“Did we want to lose another car dealership to someone who would have done the same thing for them?” Miller said.
The project is being done at no additional cost to the citizens, Miller said, because Laura Buick GMC continues to pay the taxes to the city they were before the redevelopment agreement was reached.
