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Home My WebLink About95-164 Resolution No. 95-164 RESOLUTION DETERMINING THAT CERTAIN REAL ESTATE LOCATED ALONG SHELDON DRIVE IS APPROPRIATE FOR CLASS 6B COOK COUNTY REAL PROPERTY ASSESSMENT CLASSIFICATION WHEREAS, MWSR Real Estate LLC, is the owner of certain real estate located within the City of Elgin and intends to seek Class 6b Cook County Real Property Assessment Classification; and WHEREAS, the property to be acquired is unimproved and will be used for manufacturing purposes . NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN, ILLINOIS, that it hereby finds and determines that the 5 . 09 acre of real property located along Sheldon Drive, Elgin, Cook County, Illinois, assigned Permanent Index Number 06-20-102-023 is appropriate for classification 6b under the Cook County Real Property Assessment Classification Ordinance. BE IT FURTHER RESOLVED that the City Cleric be and is hereby authorized and directed to furnish the Office of the Cook County Assessor with a certified copy of this resolution. s/ Kevin Kelly Kevin Kelly, Mayor Presented: July 26 , 1995 Adopted: July 26 , 1995 Omnibus Vote: Yeas 7 Nays 0 Attest: s/ Dolonna Mecum Dolonna Mecum, City Clerk I A 11E1(1.... 1:s.,. .r4c,,t. Agenda Item No.7t t U F, -,. July 3, 1995 TO: Mayor and Members of the City Council FROM: Richard B. Helwig, City Manager SUBJECT: Cook County Class 6b Real Estate Tax Incentive MWSR Real Estate LLC PURPOSE To provide information regarding a request from MWSR Real Estate LLC for approval from the City for participation in the Cook County Class 6b Real Estate Tax Incentive Program. BACKGROUND In May of 1986 , the Cook County Board of Commissioners ap- proved an ordinance amending the Real Property Assessment Classification Ordinance to provide for real estate tax incen- tives for various types of nonresidential developments . The amended ordinance provides for three separate incentive class- es that apply to industrial and commercial developments . These are: Class 6 , which applies to industrial properties; Class 7 , which applies to commercial developments; and Class 8, which applies to both commercial and industrial properties under limited conditions . Since the adoption of the amended Cook County ordinance, the City has processed five (5) real estate tax incentive requests under Class 6b of the ordinance. Among other prerequisites, Class 6b requires the local municipality to determine that development would not occur without the incentive. The City has not processed real estate tax incentive requests under any of the other provisions of the amended Cook County ordinance. Basically, Class 6b is applicable to any manufacturing facili- ty which is newly-developed, substantially rehabilitated, re-utilized following a prolonged vacancy, or located in a State of Illinois Certified Enterprise Zone. Class 6b pro- vides for a reduction of the Cook County real estate tax assessment factor for industrial properties from thirty-six percent (36%) to sixteen percent ( 16%) for eight years, 23% for for the ninth year, and 30% for the tenth. Thereafter, the assessed valuation is the full 36% of the fair market value. The State equalization factor for Cook County contin- Mayor and Members of the City Council July 3, 1995 Page 2 ues to apply. The most recent State equalization factor for Cook County is 2 . 1407 The factor for Kane County is 1 . 0588 . Since the equalization factor in Cook County is approximately two times that of Kane County, the 6b tax program brings the amount of taxes paid by the Cook County business on to an equal footing with those paid by Kane County businesses for a period of eight years. The City received a request for approval of a 6b tax incentive for a 5 . 09 acre location along Sheldon Drive owned by MWSR Real Estate LLC. In the course of City Council consideration of 6b requests in the past, a number of questions were raised regarding real estate tax revenue for the City and School District U-46 . MWSR is planning on building a new 47,000 square foot facility on this property. Construction is to commence this year with the 6b incentive in place. This facility will employ 50 full-time and 1-5 part-time employees . The property index number is 06-20-102-023 and is zoned gener- al industrial . The total 1994 taxes paid in 1995 for the index number was $4, 387 . 00 . Of that total tax amount, $2, 177 .26 was allocated to School District U-46, being 49 . 63% of the total tax. In addition, $990 . 15 or 22 . 57% of the total tax was allocated to the City of Elgin. The property and facility will be utilized by two affiliated companies. These companies and their respective businesses and space utilization follows : WPC Machinery Corporation - WPC Machinery Corporation will utilize subject property for the design, development, manufacture, fabrication, assembly and sale of printing press auxiliary equipment, components and parts for new and existing press lines . WPC Machinery Corpo- ration will utilize approximately 80% or 37,000 square feet of building space. Midwest Soil Remediation - Midwest Soil Remediation Inc. will utilize subject property for the manufacture, fabrication, assembly, installation and storage of equipment and components used in the maintenance of its soil remediation equipment. Midwest Soil Remediation Inc. will utilize approximately 20% or 10,000 square feet of the building space. It is estimated that $1,500,000 dollars of improvements will be placed on the property together with approximate land value of $325,000. Assuming the fair market value was determined to be $1,825,000 two scenarios for property tax revenues evolve. Mayor and Members of the City Council July 3, 1995 Page 3 Without 6b Incentive - Equalized Assessed Valuation $ 1,406 ,440.00 - Overall Tax Rate 8 . 996/$100 EAV - Annual Taxes $ 126,523.00 With 6b Incentives - Equalized Assessed Valuation (years 1 - 8) $ 625,085 . 00 (year 9) 898,560 . 00 (year 10) 1, 172,033. 00 - Overall Tax Rate 8 . 996/$100 EAV - Annual Taxes (years 1 - 8) $ 56,233 . 00 (year 9 ) 80,834 . 00 (year 10) 105,436 .00 TEN YEAR IMPACT Without 6b Incentive - Total Taxes $ 1,265,230 .00 With 6b Incentive Years 1 - 8 $ 449,864 .00 Year 9 80,834 .00 Year 10 105,436 . 00 Total $ 636, 134 .00 Current Taxes Paid Without Project Total City of Elgin U-46 Others Taxes (22 .6%) (49 .6%) (27 .8%) Current $ 4,387 .00 $ 990 .00 $ 2, 177 .00 $1,220 . 00 Impact on Various Taxing Bodies Over Ten Years : Total City of Elgin U-46 Others Taxes 22 .57% 49 .63% 27 .8% W/0 6b $1,265,230 $ 285,562 $ 627 .934 $ 351,734 With 6b $ 636, 134 $ 143,575 $ 315,713 $ 176,846 Variance $ 629, 096 $ 141,987 $ 312,221 $ 174,888 MWSR is requesting that an ordinance be passed approving the 6b classification and expressly stating that the City of Elgin • Mayor and Members of the City Council July 3, 1995 Page 4 supports and consents to the class 6b application and that it finds class 6b necessary for development to occur on the above property. COMMUNITY GROUPS/INTERESTED PERSONS CONTACTED This matter will be reviewed with School District U-46 and their comments will be obtained. FINANCIAL IMPACT If the project does not proceed, property taxes over a ten year period will total $43,870 . If the project does proceed and the 6b incentive is granted, property taxes over the ten year period will total $636 , 134 . If the project proceeds and the 6b incentive is not granted, property taxes over the ten year period will total $1,265,230 . LEGAL IMPACT None. RECOMMENDATION The 5. 09 acres of property located along Sheldon Drive in Elgin is currently undeveloped. The firm is considering an expansion of its business within the Cook County portion of the City of Elgin and the boundaries of School District U-46 . In order to equalize the amount of property taxes paid by the company between Kane and Cook County, staff recommends support for the 6(b) incentive program request. Respectfully submitted, 24/ Raymond H. Moller Director of Business Services and Properties 1�. Richard B. Helwig City Manager RHM/sg Attachments 401) . ,. 1 64 -- - -- - -- -- - I ' ss, ,: I I I I I I I I 0 I I I [ k I I _aO Q P I 0 ` I -O/3 I. !�`O IA I S• Zdo� \I , :Nir I o 1 * v '`1 o 0 0 N I CO It _Oil -023 CO I S It I I ‘'‘O 1 I 0 I SHELDON ""-zs-«-_•••.ual DR • * 6�f= li:- ZOS./ - .14L. G • 14S./ - I _ N1 I ' —oil �� Pi( - D13 I T� 5. k 11. 8. 2 d , � �6 on,. Co C1-ERK'S TELEPHONE 708/931-6100 �. Ell � FAX 708/931-5610 ç PY FOR HEARING IMPAIRED of E� TDD 708/931-5616 j`sF 1 CITY OF ELGIN 150 DEXTER COURT ELGIN, ILLINOIS 60120-5555 1= to doh• IIIV \'PAEED FI, Direct Line 931-5660 July 27 , 1995 Cook County Assessor Cook County Building 118 North Clark Street Chicago, IL 60602 Re: Class 6B Tax Incentive Gentlemen: I am enclosing a certified copy of the following resolution adopted by the Elgin City Council on July 26, 1995, regarding Class 6B assessment classification: Resolution No. 95-164 determining that real estate located Along Sheldon Drive is Appropriate for Class 6B Cook County Real Property Assessment Classification Sincerely, Dolonna "Loni" Mecum, CMC City Clerk dkm Enclosure CERTIFIED MAIL t (i) Printed on recycled paper