Committee on Economic, Capital and Technology Development
Chicago City Council
Politics
Remote
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Reporting
Edited and summarized by the Chicago - IL Documenters Team
Note-taking by
Chloe Vitale
More space and freedom for home businesses, Special Service Area appointments, Tax incentives for new developments
Live reporting by
Rocio Villasenor
More space and freedom for home businesses, Special Service Area appointments, Tax incentives for new developments
Rocio Villaseñor
@Rose26rv
Good afternoon! I will be tweeting today's Chicago City Council Committee on Economic, Capital and Technology Development remote meeting at 2:00 PM CT for @CHIdocumenters.
02:01 PM Apr 13, 2021 CDT
Here is the meeting notice, which can be accessed at: chicago.legistar.com/DepartmentDeta…
chicago.documenters.org/documents/noti… https://t.co/iPzH2woc7w
chicago.documenters.org/documents/noti… https://t.co/iPzH2woc7w
Here is the agenda for the meeting. There are 13 items to be discussed.
chicago.legistar.com/MeetingDetail.…
chicago.documenters.org/documents/agen… https://t.co/HmVzbz29Xz
chicago.legistar.com/MeetingDetail.…
chicago.documenters.org/documents/agen… https://t.co/HmVzbz29Xz
The live streaming began, and some committee members are conversing about the weather.
Chairman Gilbert Villegas (36th Ward) appears on the Zoom call. He calls the meeting for the Committee on Economic, Capital and Technology Development to order at 2:06 PM.
Chairman Gilbert Villegas (36th Ward) appears on the Zoom call. He calls the meeting for the Committee on Economic, Capital and Technology Development to order at 2:06 PM.
Villegas asked the secretary Alvarez to do rollcall attendance. She does. There are 13 committee members present out of 20.
There are two additional alderman – Alderman Patrick D. Thompson (11th Ward) and Alderwoman Susan Sadowski Garza (10th Ward) - not committee members present on the call and wish to be added.
Villegas calls for a quorum/meeting to begin.
Villegas calls for a quorum/meeting to begin.
Villegas said, “first order of business is approval of the March Monthly Rule 45 report.” He said all members should have received copy of report electronically. Asked if there were any questions or comments. No one said anything. Asked for motion.
Alderman Michael Scott Jr. (24th Ward) calls for motion to approve monthly March report. Report approved.
Villegas said they will move on to public comment. There is only one person – Marilyn May. She is given 3 minutes to speak.
Villegas said they will move on to public comment. There is only one person – Marilyn May. She is given 3 minutes to speak.
May said she is present today on behalf of Black Heroes Matter Coalition to ask and “remind you all to support our call to vote this month” to change the name of Lake Shore Drive to Du Sable Drive at the next City Council meeting which is next Wednesday April 21st.
May is also asking them to vote to approve for a full city holiday and a 25-foot monument to honor Chicago’s founder – Jean Baptiste Point Du Sable.
blockclubchicago.org/2020/12/10/cit…
blockclubchicago.org/2020/12/10/cit…
Villegas moves on to the items on the agenda 1-9. They are a series of appointments and reappointments to various Special Service Areas (SSAs), which were introduced by Mayor Lori Lightfoot during the March 24 City Council meeting.
Villegas names each item 1-9. https://t.co/bYxXNlflOC
Villegas names each item 1-9. https://t.co/bYxXNlflOC
After he is done listing them. He asks if any of these appointees would like to make a statement. None do.
Villegas asks if there are any questions from the committee members? None.
Villegas asks for motion for approval of these SSAs appointments and reappointments.
Villegas asks if there are any questions from the committee members? None.
Villegas asks for motion for approval of these SSAs appointments and reappointments.
Alderwoman Emma Mitts (37th Ward) puts motion. It is approved. Villegas said they will be reported out at the next City Council meeting on April 21.
Villegas thanks the SSA commissioners approved for their work. “We look forward to working with you.”
Villegas thanks the SSA commissioners approved for their work. “We look forward to working with you.”
Villegas moves on to item #10 on the agenda – "ordinance to support a class 6(b) tax incentive for property located at 3737 11. South Ashland Avenue, which was introduced during the March 24 City Council meeting by Mayor Lightfoot and is located in the 11th Ward." https://t.co/i9N7zay3PY
Emmet Morrissey, Financial Planning Analyst, from the Department of Planning and Development began talking and pulls up a power presentation. https://t.co/EOTShVxIrP
Morrissey goes over the presentation slides. He is requesting approval of this project “and signup for LPC in one LLC for the purpose of constructing a 137,922 square foot industrial building” in the McKinley neighborhood and 11th Ward.
He showed the map of the construction project – it is near the intersection of Ashland and 37th Street. https://t.co/R3Bs6LUbH0
Said the applicant invested an “estimated $17million for the purpose of building an Aviation Institute of maintenance [which] recently signed an agreement to lease the entire space.” https://t.co/7Jdm4D3SOI
Morrissey said the facility’s focus will be on training 600 students to work in the aviation industry. He further explained how the average wage for graduates of this industry is estimated to be at $70,930.
He added that if this incentive is approved it would provide “$5,138,395 in property tax savings over the 12-year-period.”
The project is funded through a combination of debt and equity. The total project cost was $16.7 million.
The project is funded through a combination of debt and equity. The total project cost was $16.7 million.
Said the project will result in an estimated $3,707,574. Said DPD supports the project because it will create approximately 75 full-time jobs – 75 temporary construction positions. Added that this property was vacant for 20 years.
Ended presentation by stating he is joined by the developer Ben Fish and the tenant Greg Daniels if any committee members have questions.
Villegas asked if there are any questions.
Called on Alderman Thompson, whose ward this project will be in. Thompson said this is a “terrific project” & “positive impact on the community” because it is going to create jobs & create an economic impact on the Ashland corridor...
Called on Alderman Thompson, whose ward this project will be in. Thompson said this is a “terrific project” & “positive impact on the community” because it is going to create jobs & create an economic impact on the Ashland corridor...
...between Bridgeport and McKinley Park – in the Stockyards manufacturing district. Thompson asked committee members for a “favorable vote” in support of the project.
Villegas called on Alderman Thomas Tunney (44th Ward), Tunney had a question about the cost - $16 billion dollar and a slide.
Morrissey pulled it up again. Morrissey said the annual taxes are $43,353, the net benefit to the taxing districts is $3,707,574, estimated tax abatement to the applicant is $5,138,395, and the city’s share of the $5million is estimated to be $1,185,026.
Tunney had a follow-up question about the $5 million abatement. Asked if it is over a 12-year-period? Morrissey said yes. He said “it reduces the assessment by approximately 60% from the initial 10 years.”
Tunney seemed to be worried this is a “pretty high abatement for the development costs.”
Added, “I understand it’s a great project” but the “ration seemed a little generous.”
Added, “I understand it’s a great project” but the “ration seemed a little generous.”
Morrissey said it is based on the square footage of the facility and comparable buildings in the area. Said the developer is there to answer any questions. Morrissey added that it also had to do with environmental issues the developer had to correct when developing the site.
Tunney continued to question the deal “sounds like a pretty good deal, and I understand the benefits. I’m not disputing the benefits…ratio seems a little generous to me…just my opinion on it.”
Tunney asked if Tunney would like to hear from developer. Tunney said yes. Morrissey added, “DPD is supporting the project because of the benefits attainable they bring into the community.”
Morrissey continued to discuss the aviation institute – what it will be doing – training students to work on airplanes and airplane parts.
Villegas called on developer to respond/reply to Tunney’s comment about the abatement ratio.
Villegas called on developer to respond/reply to Tunney’s comment about the abatement ratio.
Ben Fish of Logistics Center Company (LLC), the developer of the project site appeared on the call.
Tunney asked his question to Fish about the tax abatement ratio $16 million & $5 million over 12 years. Said that is a “pretty generous incentive” – return.
Tunney asked his question to Fish about the tax abatement ratio $16 million & $5 million over 12 years. Said that is a “pretty generous incentive” – return.
Tunney asked Fish, “what you are trying to do here?”
Fish reiterated what Morrissey said about the developer settings going directly to the tenant. Fish said “triple net lease. So we don’t see any benefits of this – this is strictly a tenant benefit.”
Fish reiterated what Morrissey said about the developer settings going directly to the tenant. Fish said “triple net lease. So we don’t see any benefits of this – this is strictly a tenant benefit.”
Tunney questioned Fish’s comment. “I’ve been a landlord, & some are not triple net leases…it’s an indirect benefit. So that to me is kind of a false assessment.”
Fish said he understood what Tunney meant. “It’s not a landlord savings…these tax costs are passed to the tenant.”
Fish said he understood what Tunney meant. “It’s not a landlord savings…these tax costs are passed to the tenant.”
Tunney then said “I said my piece, I’m fine with it. I just kind of know where I’m going with it…I will be supporting it. But I think we need to make sure [about the why.]”
Villegas called on Alderman George Cardenas (12th Ward). Cardenas said he has a similar questioning to Tunney’s about the abatement ratio. “I think that any landlord or any developer saying that they don’t get any benefit…let’s just be honest that there’s a tax benefit...
...Otherwise, you wouldn’t do the deal…”
Cardenas added he is interested in this project because it is in McKinley Park which is part of his ward & next to his ward. “We have responsibility to ask these questions. I know constituents are going to want to know exactly how...
Cardenas added he is interested in this project because it is in McKinley Park which is part of his ward & next to his ward. “We have responsibility to ask these questions. I know constituents are going to want to know exactly how...
...we’re managing the city’s resources.”
Tim Jeffries, Deputy Commissioner of Financial Incentives Division from the DPD, chimed into the call.
Tim Jeffries, Deputy Commissioner of Financial Incentives Division from the DPD, chimed into the call.
Jeffries explained the incentive more thoroughly. “Incentive is really it’s a function of the property tax bill or the anticipated property tax bill…”
Jeffries added that the city assessment decided how much incentive a project receives.
Jeffries added that the city assessment decided how much incentive a project receives.
Explained that DPD looks at the project and if it meets the minimum requirements outlined by the county ordinance, benefits of the project to the community and economy.
Cardenas said, “We’re just trying to get educated…in terms of more or less where we’re at…”
Cardenas said, “We’re just trying to get educated…in terms of more or less where we’re at…”
Villegas said maybe DPD should set something up where the committee members can be briefed more about incentives.
Alderman Silvana Tabares (23rd Ward) wanted to be added to the rollcall attendance since she logged in late to the meeting. Villegas asked secretary to add Tabares.
Alderman Silvana Tabares (23rd Ward) wanted to be added to the rollcall attendance since she logged in late to the meeting. Villegas asked secretary to add Tabares.
So, there are 14 members present I believe.
Villegas asked if there are any other questions or comments. None. He asked for motion. Alderman Ariel Reyboras (30th Ward) puts motion. (I believe)
It is approved and will be reported on the next city council meeting Apri 21st.
Villegas asked if there are any other questions or comments. None. He asked for motion. Alderman Ariel Reyboras (30th Ward) puts motion. (I believe)
It is approved and will be reported on the next city council meeting Apri 21st.
Villegas moved onto item #11 on the agenda – ordinance and supportive class 6(b) tax incentive property located at 3300 East 100 and 22nd Street, building B. It was introduced during last month’s City Council meeting by Mayor Lightfoot. This project is in the 10th Ward. https://t.co/KCKATC3paH
Morrissey had a presentation for this one, too. He pulled it up.
Morrissey went over this project – tax incentive for NP Avenue O, LLC for the purpose of constructing a 602,545 square foot industrial building of a larger campus located at 3300 East 122nd Street – building B. https://t.co/lleeuFoh1G
Morrissey went over this project – tax incentive for NP Avenue O, LLC for the purpose of constructing a 602,545 square foot industrial building of a larger campus located at 3300 East 122nd Street – building B. https://t.co/lleeuFoh1G
Goes over the costs and benefits.
(*NOTE THAT CONNECTION WAS LOST DURING THIS PRESENTATION.) https://t.co/YGE1Qww56K
(*NOTE THAT CONNECTION WAS LOST DURING THIS PRESENTATION.) https://t.co/YGE1Qww56K
-$4,539, 368 incentives in place
-180 to 220 new full-time positions
-20 year vacant property
Christina Hubacek developer and Tom George tenant present to answer questions. https://t.co/gbkGXASB4u
-180 to 220 new full-time positions
-20 year vacant property
Christina Hubacek developer and Tom George tenant present to answer questions. https://t.co/gbkGXASB4u
Tunney commented something – was not able to catch it.
Villegas called on Alderman Garza. (Connection problem again.)
Garza, whose ward will have this tax incentive project & is not a member of the committee, told other members to vote yes on it.
Villegas called on Alderman Garza. (Connection problem again.)
Garza, whose ward will have this tax incentive project & is not a member of the committee, told other members to vote yes on it.
No more questions. Villegas called on motion to pass. Alderman Raymond A. Lopez (15th Ward) puts motion. It is approved. Villegas said it will be presented at the next City Council April 21st meeting.
Villegas moved on to item #12 on the agenda – class 6(b) tax incentive for property at 3044 East 122nd Street – Building E. It was introduced by Mayor Lightfoot at last month’s City Council meeting and referred to the committee. It is located in the 10th Ward. https://t.co/LBEaIp8iSQ
Morrissey has a presentation for this one, too. Pulled it up. https://t.co/A661PnyruI
Morrissey said it is one building, but six buildings for the larger campus. If approved, it would provide $5,807,184 tax savings over a 12-year-period. Total project cost is $43,720,725. https://t.co/n6mqBsSa7Q
It has been vacant since the former Steel Mill in 2001.
DPD supports this project because it will create:
-130-150 construction jobs
-completed project estimated to create 174-200 new full-time jobs to the community. https://t.co/DVx0COA6AN
DPD supports this project because it will create:
-130-150 construction jobs
-completed project estimated to create 174-200 new full-time jobs to the community. https://t.co/DVx0COA6AN
Christina Hubacek and Tom George are on the call for this one, too.
Morrissey asked members if they have questions.
Morrissey asked members if they have questions.
Villegas had a question about M&W goals on the project?
Morrissey said there are. “There’s a redevelopment agreement in place and 26% M&B and 6% WB.”
Morrissey said there are. “There’s a redevelopment agreement in place and 26% M&B and 6% WB.”
Villegas thanked Morrissey. Then asked if other members had any questions?
Villegas called on Tunney.
Villegas called on Tunney.
Tunney said both are speculative. He would like to know if there are:
1. ‘Any identified tenants’?
2. Tax savings based on full occupancy?
1. ‘Any identified tenants’?
2. Tax savings based on full occupancy?
Morrissey said it is based on full occupancy and comparable properties in the general neighborhood.
Tunney said he got the square footage formula. He asked about not having a tenant for three or four years, and fully occupied. Vacancy rates based on speculative deals?
Tunney said he got the square footage formula. He asked about not having a tenant for three or four years, and fully occupied. Vacancy rates based on speculative deals?
Morrissey said yes – the developer of the property could appeal property taxes based on vacancy and reduce the annual taxes.
Tunney said, “Yes, that makes all the business sense in the world.”
Tunney said, “Yes, that makes all the business sense in the world.”
Tunney asked if the developer could speak on the potential for the two projects – when can we get the coffee shops and all the services for Alderwoman Garza?
Christina Hubacek with Northpoint Development appeared on the call.
Christina Hubacek with Northpoint Development appeared on the call.
She said there has been a lot of interest in both of the buildings – Building B which is scheduled to start in May 2021 & complete by the end of this year or early next year & E.
Hubacek the demand for these building types is “exceedingly high, but the availability in the...
Hubacek the demand for these building types is “exceedingly high, but the availability in the...
market is exceedingly low.”
Hubacek added that they have hope to lease the building before it is fully constructed. She said that if they do see an impact on the market they will pause on building E until building B is fully leased.
Hubacek added that they have hope to lease the building before it is fully constructed. She said that if they do see an impact on the market they will pause on building E until building B is fully leased.
Since they do not want to have to vacant buildings in the park. Asked if there are any follow-up questions to that?
Tunney said his only follow-up is – what types of manufacturers you think, or industrial users will be appropriate for these two buildings?
Tunney said his only follow-up is – what types of manufacturers you think, or industrial users will be appropriate for these two buildings?
What kind of businesses or industries?
Alderman Nicholas Sposato (38th Ward) chimed in and said a name of a restaurant…
Garza chimed in and said, “We could use one of those down here aldermen.”
Alderman Nicholas Sposato (38th Ward) chimed in and said a name of a restaurant…
Garza chimed in and said, “We could use one of those down here aldermen.”
Hubacek said they have seen interest from a variety of clientele from storage manufacturers like Ford campus, light e-commerce interest. She said it depends. Added that, “Amazon looked at this park, but ran away. But we know they will be back.” (laughed)
Villegas called on Garza.
Garza thanked the developer and said she hoped members will vote yes on this “much needed development in our ward.”
Villegas asked for motion to pass. Sposato puts motion. Passed & will be mentioned in the next City Council meeting on April 21st.
Garza thanked the developer and said she hoped members will vote yes on this “much needed development in our ward.”
Villegas asked for motion to pass. Sposato puts motion. Passed & will be mentioned in the next City Council meeting on April 21st.
Villegas moves to last item on agenda #13 – "amending municipal code 4-6-270 to modify requirements for application or renewal of regulated business licenses for home occupations."
Villegas introduced this ordinance during the January 27th City Council meeting. https://t.co/9zaUP1pZ6D
Villegas introduced this ordinance during the January 27th City Council meeting. https://t.co/9zaUP1pZ6D
Villegas said since then the following changes have been made to the ordinance:
1. Original language of license requiring “accessory buildings or accessory structures only used as institutes of storage of business was kept.”
1. Original language of license requiring “accessory buildings or accessory structures only used as institutes of storage of business was kept.”
2. Added the following, “storage of machines or bulk material to utilize in the operation of construction business or landscaping business as activities not subject to the license requires incidental storage compliance with off street parking zoning regulations. Use of garage...
...to block the public way i.e. streets and alleys. Places the original 10% of floor area of home based business and 40% introduced…with 300 square feet – 25% of the total floor area of the home based business and requires bulk deliveries to occur between 9 and 6 in addition...
...to following fire prevention and special types of vehicles for City of Chicago street ordinances. Removed restrictions with incidental storage use of chemicals…”
Businesses must still comply with all applicable codes.
Businesses must still comply with all applicable codes.
Villegas asked for motion to accept substitute ordinance. Alderwoman Maria E. Hadden (49th Ward) put motion.
Villegas talked about the substitute ordinance and the work it will do support small businesses and the advocates for small businesses like Elliot Richardson and...
Villegas talked about the substitute ordinance and the work it will do support small businesses and the advocates for small businesses like Elliot Richardson and...
...Beth Kregor. “We are proud of this ordinance and are looking forward in ways to build economic growth and provide support for our small businesses along these partnerships.”
10% to 25% more square footage helps small businesses Villegas added.
10% to 25% more square footage helps small businesses Villegas added.
He said the changes will help primarily minority owned and female owned businesses in Chicago based on a Facebook survey they did.
Villegas called on Rosa Escareno, Commissioner at Chicago Department of Business Affairs and Consumer Protection.
Villegas called on Rosa Escareno, Commissioner at Chicago Department of Business Affairs and Consumer Protection.
Escareno said she supports the substitute ordinance. “It will expand opportunities for entrepreneurs to start a business out of their home.”
The ordinance will “provide safeguard to protect consumers from fraud and guarantees safety & preserves residential neighborhoods.”
The ordinance will “provide safeguard to protect consumers from fraud and guarantees safety & preserves residential neighborhoods.”
Escareno said this “ordinance will make it easier for entrepreneurs to start a business out of their home especially at this critical time.”
The ordinance will also provide other benefits like:
-expanding options for home sales
The ordinance will also provide other benefits like:
-expanding options for home sales
-verifying restrictions on storage with accessor structures
-safety, minimizes consumer fraud, and preserves residential neighborhood
Emphasized that they “do not want residential areas turning into commercial districts, or our homes to turn into dangerous home environments.”
-safety, minimizes consumer fraud, and preserves residential neighborhood
Emphasized that they “do not want residential areas turning into commercial districts, or our homes to turn into dangerous home environments.”
Ordinance, “keeps limitations on certain businesses that could lead to unsafe or fraud concerns. It also limits activities that will be allowed in garages and other units that may be unsafe for business…”
Escareno said this ordinance is “Striking the right balance.”
Escareno said this ordinance is “Striking the right balance.”
Villegas called on Elliot Richardson, Small Business Advisory Council. Richardson said they strongly support the ordinance and thanked Villegas’ leadership.
Richardson added, “entrepreneurs start at home…they create jobs and revenue. That’s what we want to see in Chicago.”
Richardson added, “entrepreneurs start at home…they create jobs and revenue. That’s what we want to see in Chicago.”
Villegas called on Beth Kregor from the Institute of Justice. Kregor is a lawyer and advocate, she is the director for IJ Clinic’s entrepreneurship at the University of Chicago Law School.
Kregor said more Chicagoans had needed to start their businesses from...
Kregor said more Chicagoans had needed to start their businesses from...
their home due to the pandemic.
She said, “Chicago’s current law restricts businesses to a tiny space in their homes. Chicago is more restrictive than other city we could find…We think it is vital that business owners have the space to work from home.”
She said, “Chicago’s current law restricts businesses to a tiny space in their homes. Chicago is more restrictive than other city we could find…We think it is vital that business owners have the space to work from home.”
“We believe this ordinance will make it possible for many more creative entrepreneurs to operate home based businesses…and make their own jobs…”
Villegas thanked other individuals for this ordinance.
Villegas called on Cardenas.
Villegas thanked other individuals for this ordinance.
Villegas called on Cardenas.
Cardenas wanted to add on Villegas’ final word. He said about a developer for residential housing and business. Cardenas said they might have to work with zoning department for this concept.
Cardenas said that banks will want to know how to finance this new initiative.
Cardenas said that banks will want to know how to finance this new initiative.
“Zoning might have to take this on…”
Villegas called on Hadden.
Hadden said she just wanted to echo her support for this ordinance. “Excited to work on this…Especially on the 49th Ward community.”
Villegas called on Hadden.
Hadden said she just wanted to echo her support for this ordinance. “Excited to work on this…Especially on the 49th Ward community.”
Villegas called on motion to approve this ordinance. Lopez put motion.
Villegas said it is approved & will be heard in the next City Council meeting on April 21st.
Villegas said he wanted to wish happy birthday to Alderwoman Stephanie Coleman (16th Ward) & Michael H. from ARB.
Villegas said it is approved & will be heard in the next City Council meeting on April 21st.
Villegas said he wanted to wish happy birthday to Alderwoman Stephanie Coleman (16th Ward) & Michael H. from ARB.
Villegas called for motion to adjourn meeting. Lopez put in motion. Meeting adjourned at 3:08pm. Live streaming ended.
Thank you for following along! 😊
Thank you for following along! 😊
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If you want more information about this meeting, please look here:👇
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