For a number of months now the community has been offered a glimpse at a “vision” by Schiller Park of a proposed development plan for the Schiller Park Sexton Landfill. For now, for the purpose of my examining the actual vision of the Village and Sexton for economic development and resident amenities I will ignore but not forget the serious concerns over the environmental and health concerns, increased flooding, and lack of access regarding the Schiller Park Sexton landfill.
That vision is to approve a land use plan that would include a 450 car parking lot to be utilized by O’Hare Airport travelers; the elimination of a moratorium on billboards on the east side of the TriState Tollroad, and the construction of 3 billboards; and a bit confusing concept regarding a golf driving range which has been proposed in a bit of a mixed message with Mayor Piltaver talking about an open air driving range, then a domed driving range and at one point telling a chamber meeting a golf course. At the latest Board meeting, Mayor Piltaver clarified that it would be a domed driving range. So all of this has been pitched by Mayor Barbara Piltaver and the Sexton Company jointly as economic development for Schiller and enhanced amenities for the residents of the area.
So first what will actually the 450 car parking lot do for the community ?
If we assume that the parking lot is 100 % full 365 days a year; the tax revenue for Schiller Park would be $82,000 (current tax ordinance is $1.00 per car per day, but Schiller Park has already 20 year agreement with the new parking garage on Mannheim to keep the tax at .50 per day which they would extend to Sexton as well so they could be competitive). The operator at the same time with the same assumptions charging $10.00 per day per car would realize a revenue of $1,642,500 annually.
What do the local residents face for at maximum revenues of $82,000 per year for the next 20 years ? Increased traffic with the accompanying additional noise, potential crime increase, lighting pollution from a 24 hour operation, and additional water runoff from a paved parking lot.
So let’s look at the billboard aspect of the development. The proposal is fuzzy, but we can make some assumptions from the other billboard construction in the area as well as the developing technology in the business. This approval will most likely result in the construction of three pylons with two sided signs with electronic displays. Those in the advertising industry that I talked to in the last week have projected that such an installation in the O’Hare tollroad corridor could result in annual revenues as much as $360,000 per sign face or over $2,000,000 a year in annual revenue.
The Sexton Company is proposing a one time impact payment to the Village of Schiller Park of $175,000.
So what impact will this part of the development have on the local resident ?
There will be increased light pollution and those living in the area will have additional visual clutter. This will also expose the residents on the east side of the Tristate to the installation of additional billboards once the Village Board has removed the billboard moratorium.
If we take Mayor Barbara Piltaver at her word. Then we can consider the third concept in the development proposal as she noted at the July 17, 2014, Village Board meeting. This concept would be the construction of a golf dome. Repeatedly, the Village has emphasized that this would be at no cost to the taxpayers of Schiller Park. Because the one time impact fee of $175,000 would be used to develop the venue, Sexton would only for the first 10 years charge a rent of $1.00 per year and the management fees for Kemper Sports would come out of the revenues.
This truly sounds like the fantasy part of this development. Mayor Barbara Piltaver wants the Village Board to enter into a lease of the property on the contaminated dump for such a venture with no agreement for the Board of Trustees to review with Kemper Sports.
There has been no feasibility study, no site study for suitability of construction, or recommendations that the Board of Trustees has to consider. Yet Mayor Barbara Piltaver and the Village administration wants the Board of Trustees to enter into a lease and approve such a project.
To even consider such a project to develop such a venue it would be prudent for Mayor Piltaver and the administration to recommend such studies prior to any decisions or committments.
The feasibility study should be divided into two phases, a financial study and a site study. The site study phase would not begin until the financial study is completed.
The purpose of this study should have objectives such as considering:
First, to assist in developing a preliminary architectural program defining the facility’s necessary components, length of season, as well as an operations model with sufficient definition, clarity and reality upon which monetization can be determined
Second, to recommend fees and charges
Third, to define an expected pro forma of total income and expense for the facility in order to determine the immediate and long term financial viability
Fourth, to forecast estimated construction costs of a facility
Fifth, to present the collected data with the clarity, depth and understanding that theVillage’s decision makers can be confident in determining the feasibility of the project
Such a process could create a sound foundation for review and consideration by the Village Board prior to any decisions.
Without such a study it is inconceivable that a sound decision in the taxpayers’ best interest can be made. It is impossible to believe even without a study that $175,000 would cover the construction of the golf venue parking lot, the customer service center building, the equipment storage building, the dome itself (and in lieu of the dome an open driving range with the accompanying netting and possible lighting) . Companies that I consulted prior to writing this article put the number more at $3,000,000 to $6,000,000. Ground conditions on the dump could seriously drive up the costs for foundations and the supporting of the structures.
There is no clear data that even indicates that such a venture by Schiller Park could be financially successful.
The only clear winner in this proposal would be anyone associated with the billboard installation. In that part of the venture there is plenty of money for everyone but the taxpayers. The next potentially successful portion of the development is likely the parking lot with the taxpayers’ seeing a very small revenue stream. Finally, the biggest exposure and downside in this development is the golf venture with the taxpayers of Schiller Park bearing the greatest exposure financially with little likely return.
Furthermore there has been no development agreement made available for public inspection. So any other taxpayer funded incentives have not been disclosed yet if any are proposed. In Sexton’s presentation before the Village Zoning Board they alluded to seeking a Class 7B Tax incentive. Such an incentive would result in a reduced real estate assessment level of 10% of fairmarket value for the first 10 years, fifteen percent (15%) for the eleventh year and twenty percent (20%) for the twelfth year. Without this incentive, commercial property would normally be assessed at twenty five percent (25%) of it market value.
This proposal would place the greatest portion of the land under the lease under the control of the Village of Schiller Park. Would this take the land off of the tax rolls ? Would the Village of Schiller Park have to underwrite the dump maintenance costs ? What liability does the taxpayer assume with the environmental issues unresolved ?
Clearly, that $82,000 in parking lot tax revenue is shrinking in light of other potential taxpayer funded potential incentives such as a 7B.
The Village of Schiller Park Administration and Mayor Barbara Piltaver need to step back and recognize that is not a good deal for Schiller Park taxpayers. Let’s not have the taxpayers get stuck with the bills while Sexton reaps the millions of dollars in financial returns.
This proposal is fraught with “smoke and mirrors”.
Everyone needs to take a closer look before leaping into this cauldron.