CRETE | The Village Board on Monday was presented with a plan that would call for municipal investment in a proposed development on the southeast corner of Main and Exchange streets.
Mahmood Lahka, owner of the Marathon gas station on that corner, and Don Seehausen, owner of the adjacent red building just south of the station, brought the proposal before the board, but were met mostly with skepticism.
Lahka wants to build a new service station and convenience mart at that location. He originally was interested in buying two lots from Seehausen to accommodate his plan.
During negotiations, Lahka offered to buy six parcels from Seehausen, and expanded his vision for the corner to include a car wash, restaurant and other retail outlets.
But the price offered by Lahka was about $250,000 less than what Seehausen was hoping for.
The two approached the board and asked the village to use tax increment financing funds to make up the $250,000 difference.
The properties are in the village TIF district and are eligible for financing designated to help businesses get started.
But, Lahka said, he didn't want TIF funds invested in the initial land purchase to be counted against tax benefits typically handed out to businesses developed in TIF districts.
“TIF financing is available to help redevelopment and make it more business-friendly for a start-up,” Lahka said. “I do not want to lose TIF benefits due to the potential investment by the village.”
Trustee Mark Wiater was leery of the proposal.
“Normally, when we are approached about investing TIF funds in a development project, we see detailed plans on the proposal,” Wiater said. “At this point, we do not know what would be developed on all of this property, and what benefit the village would see in resulting sales taxes.”
Village President Michael Einhorn told the board that the property had been assessed for $490,000, and that the $250,000 in TIF funds would result in paying much more for the property than the assessed value.
“It would not be prudent on our part to pay more for property than its current value,” Einhorn said. “In the end, this is taxpayer money. We have an obligation to be prudent in our finances.”
Seehausen originally invested about $685,000 in the six lots. The current value of $490,000 is typical of the deflated prices due to the economic collapse in commercial real estate.
Trustee Holly Milburn told Seehausen and Lahka to come back with detailed plans showing what would be done to develop the property, how it would be done, what types of businesses would be approached and how this would fit in with the village historical district.
“We have said all along that the corner of Main and Exchange is a historical district and must be developed in a certain way,” Milburn said. “We want the buildings to look a certain way and we want certain types of businesses. So we need to see detailed plans.”
The board did not shut the door on TIF funds being available for a larger project than the original service station expansion.
“But we need to know exactly what we would be investing in,” Wiater said.
Village Administrator Tom Durkin said he would contact Gingko Designers, who assisted Lahka with the original design for the service station.
“We can ask them to meet with you and draw up the concept for review in January,” Durkin said.