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T1-04 Ordinance No. T1-04 AN ORDINANCE AMENDING THE ORDINANCE ESTABLISHING AN INCENTIVE PROGRAM FOR COOK COUNTY RETAIL AUTOMOBILE DEALERSHIPS WHEREAS, the City of Elgin is located in Cook and Kane Counties; and WHEREAS, the real estate assessment classification system for Cook County results in a competitive disadvantage for automobile dealers operating in the Cook County section of the City of Elgin with respect to automobile dealers operating in Kane County; and WHEREAS, it is necessary to protect the city's tax base and promote employment within the City of Elgin to provide economic incentives to automobile dealers operating in that part of the City of Elgin situated in Cook County to continue such operations and invest in capital im- provements at such locations; and WHEREAS, the City of Elgin is a home rule unit within the meaning of Article VII of the Constitution of Illinois of 1970; and WHEREAS, the City Council of the City of Elgin previously adopted Ordinance No. T1- 99 to provide economic incentives to automobile dealers operating in that part of the City of El- gin situated in Cook County; and WHEREAS, the City Council of the City of Elgin has determined it is necessary and de- sirable to amend Ordinance No. T1-99 as provided herein; and WHEREAS, the program established herein is in furtherance of the promotion of the economic well being of the City of Elgin, a public purpose. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF ELGIN, ILLINOIS THAT ORDINANCE NO. T1-99 BE AMENDED IN ITS ENTIRETY TO READ AS FOLLOWS: Section 1. Incentive Program. That there is hereby established an economic incentive program to be known as the Cook County Retail Automobile Dealership Incentive Program. For the purposes of this ordinance, the term "retail automobile dealership" shall mean any person, partnership, corporation or other entity that has been issued a sales tax identification number by the Illinois Department of Revenue in conjunction with the operation of a retail automobile deal- ership within the City of Elgin, Cook County, Illinois. Section 2. Sales Tax Rebate Program. Any retail automobile dealership operating in that portion of the City of Elgin located in the County of Cook that makes a minimum capital im- provement to property currently owned, including furniture and fixtures, in an amount in excess of two hundred percent (200%) of the average annual amount of local retail sales tax it has paid to the City of Elgin in the three years immediately proceeding the proposed date of the agree- ment to participate in the Sales Tax Rebate Program, as verified by the Illinois Department of Revenue, shall be eligible to receive a rebate of fifty percent (50%) of the increase in sales tax in excess of the preceding three year month average retail sales tax distributed to the City of Elgin from the sale of automobiles at the participating retail automobile dealership, as verified by the City of Elgin in accordance with section five of this ordinance. This incentive shall be available for a period of seven years from the date of the approval of the corporate authorities of the City of Elgin of a participation agreement between the City of Elgin and an eligible retail automobile dealership. Section 3. Capital Investment Grant Program. Any retail automobile dealership operating in the Cook County portion of the City of Elgin is eligible to receive an investment grant equal to fifteen percent (15%) of a capital investment in an amount of Fifty Thousand Dollars ($50,000) or more but not to exceed Two Hundred Thousand ($200,000). Capital improvements qualifying for such grant shall be completed within two years after approval by the corporate authorities of the City of Elgin of an agreement that includes a description of the capital improvements to be made between the City of Elgin and the dealership under this program. Capital improvements for which the City of Elgin has previously issued a certificate of occupancy or for which the City of Elgin has issued any other similar final approval for the construction of the capital improve- ments are not eligible for participation in the capital investment grant program. At the end of the first full month of the year following commencement of construction, one half of the estimated investment grant shall be paid. The remainder of the grant shall be paid at the earlier of the completion of construction or thirteen months after commencement of construction. No retail automobile dealership shall be eligible for a grant more than once in a period of five years. Any grant amounts received shall be repaid if capital improvements for which a grant is received are not completed within two years. Section 4. Business Retention Rebate. Any retail automobile dealership operating in Cook County that agrees in writing to continue such retail operation in the Cook County portion of the City of Elgin for a period of not less than five years is eligible to receive a retail sales tax rebate in the amount of thirty-five percent (35%) of the increase in retail sales tax received by the City of Elgin from the sale of automobiles. Any such rebate shall be repaid with interest if a dealership fails to remain for the five-year period. The rebate shall be based on the increase in sales tax over the average retail sales tax distributed to the City of Elgin during the past three years by the participating retail automobile dealership. Section 5. In order to participate in the Cook County Retail Automobile Dealership Sales Tax Rebate Program, an applicant shall submit copies of Illinois Department of Revenue ("IDR") form "IDR ST-1" and IDR form "IDR ST-556" that have been issued to the retail automobile dealership for each of the thirty-six (36) consecutive months immediately proceeding the execu- rtion of the Retail Automobile Dealership Sales Tax Rebate Program with the City of Elgin. The 2 applicant shall also execute a written agreement that shall include the items necessary to comply with the provisions of this ordinance, including but not limited to the following: 1. The retail automobile dealership's agreement that, at any time upon the reasonable re- quest of the City, it will demonstrate evidence of the cost of improvements equivalent to the City's payments hereunder. 2. The retail automobile dealership's agreement that it will not, during the life of the agreement, protest, contest, or in any other way seek to lower the amount of property tax rate with respect to the property. Nothing herein contained shall prevent the retail auto- mobile dealership from protesting the assessed valuation of the property. 3. The retail automobile dealership's agreement to promptly commence and diligent pur- sue renovation activities. Once construction has begun, the retail automobile dealership agrees to construct the improvements, both on-site and off-site, in substantial accordance with plans and specifications submitted at the time of application. 4. The retail automobile dealership's agreement that in the event that Automobile Dealer's motor vehicle dealership ceases to operate at the property at any time during the duration of the agreement, the retail automobile dealership agrees to remit to the City monies received from the City pursuant to this agreement. In order to secure the require- ment to make repayment, the retail automobile dealership shall post or cause to be posted w in favor of the City a performance bond or letter of credit. Alternatively, the City may ac- cept a personal guarantee designating specific individuals who will make repayment in accordance with the agreement, provided the City's fiscal services manager, in his or her sole discretion, determines the guarantor of any such personal guarantee presents docu- mentation establishing a history of sound credit and solid financial strength indicative of the guarantor's financial ability to satisfy any repayment under the agreement. 5. Within seventy-five (75) days after each annual period, the retail automobile dealership shall provide the City with a statement signed by one of its officers as to the dollar amount of sales tax revenue paid to the State of Illinois for the benefit of the City during the prior annual period. Additionally, the retail automobile dealership shall maintain and have available for inspection by the City copies of any and all sales tax returns, sales tax reports, amendments, proof of payment or any other sales tax information filed with the State of Illinois or other appropriate governmental entity, which documents are being held available for the City for purposes of identifying sales tax revenue collected pursu- ant to this agreement for each calendar years during the life of the agreement. Addition- ally, the City shall use its best efforts to obtain such sales tax information directly from the Illinois Department of Revenue or the State of Illinois. To the extent permitted by law, the City shall endeavor to maintain the confidentiality of the information contained in such reports, but shall be permitted to disclose such information and documents to em- ployees and consultants as the City (except for any consultant that has a financial interest in any motor vehicle dealership within the Chicago Metropolitan Area, which consultant shall not be retained), in its sole discretion deems appropriate in order to monitor compli- ance and audit this agreement. The retail automobile dealership also agrees, upon the re- 3 quest of the City, to furnish such consents or waivers as may be required by the Illinois Department of Revenue to allow the Illinois Department of Revenue to furnish to the City sales tax information concerning the retail automobile dealership. 6. No recourse under or upon any obligation, covenant or agreement of this agreement or for any claim based thereon or otherwise in respect thereof shall be had against the City, its officers, agents and employees, in any amount or in excess of any specific sum agreed by the City to be paid to the retail automobile dealership, subject to the terms and condi- tions herein, and no liability, right or claim at law or in equity shall attach to or shall be incurred by the City, its officers, agents and employees in excess of such amounts, and all and any such rights or claims of the retail automobile dealership against the City, its offi- cers, agents and employees are hereby expressly waived and released as a condition of and as consideration for the execution of this agreement by the City. No recourse under or upon any obligations, covenant or agreement of this agreement or for any claim based thereon or otherwise in respect thereof shall be had against the retail automobile dealer- ship, its officers, agents and employees, in excess of their obligations to the City here- under, subject to the terms and conditions herein, and no liability, right or claim at law of or in equity shall attached to or shall be incurred by the retail automobile dealership, its officers, agents and employees, in excess of their obligations hereunder. 7. Such agreement may also include a limitation on the total amount of the rebate the re- tail automobile dealership may receive from any of the incentives contemplated in this ordinance and may also provide for a minimum period of time for which the retail auto- mobile dealership must continue operating in the portion of the City of Elgin located in Cook County, Illinois. 8. The City and the retail automobile dealership agree to do all things necessary or appro- priate to carry out the terms and provisions of this agreement and to aid and assist each other in carrying out the terms hereof 9. This agreement shall be governed by the laws of the State of Illinois and the sole and exclusive venue for any disputes arising out of this agreement shall be within the Circuit Court for the Sixteenth Judicial Circuit, Kane County, Illinois. A waiver of any part of this agreement shall be limited to that specific event and shall not be a waiver of the en- tire agreement. Any notices required in this agreement shall be effective when in writing and three (3) days after mailing by certified mail, return receipt requested, or by deliver- ing the same in person or to an officer of such party or by prepaid telegram or private overnight courier, when appropriate, addressed to the party to be notified. Section 6. The provisions of this ordinance are intended to provide guidelines for consid- ering applications from retail automobile dealerships that are seeking to participate in the Cook County Retail Automobile Dealership Incentive Program. The City Council of the City of Elgin, in its sole and exclusive discretion, shall determine whether to provide any of the incentives con- templated in this ordinance after duly considering the costs incurred by the City of Elgin for pro- viding the incentives and after considering the relative gain derived by the public from those in- centives. 4 Section 7. This ordinance shall be in full force and effect from and after its passage and publication in the manner prescribed by law, provided, however, that the amendatory provisions of this ordinance may be applied retroactively to any retail automobile dealership having an ex- isting agreement with the City of Elgin for participation in the Cook County Retail Automobile Dealership Incentive Program. Ed Schock, Mayor Presented: March 10, 2004 Passed: March 10, 2004 Omnibus Vote: Yeas: 6 Nays: 0 Recorded: March 11, 2004 Published: March 11, 2004 Attest: tg-6421,—‹ Dolonna Mecum, City lerk ruk 5