Washington Park Plaza got a five-year extension to its sales tax sharing agreement with Homewood when trustees voted May 23 to approve the deal.
The shopping center at 17748-17956 Halsted St. is home to national retail stores Best Buy, TJ Maxx, Five Below, Petco and Old Navy. The center was referred to as a “model retail anchor” on Halsted in a memo to the board from Village Manager Napoleon Haney. It has contributed significantly to the village’s revenues over the years.
Village officials consider the shopping center a key source of sales tax revenue. (Eric Crump/H-F Chronicle)
The extension agreement caps the benefits at $5 million. Haney said the owner requested the extension to enable a refinancing deal that will likely help attract new quality retailers to the shopping center.
Haney recounted the history of the plaza, noting that the sales tax sharing deal originally was made in 2005. The original agreement included an $850,000 property tax rebate, which was reached in the sixth year of the 10-year agreement, and in sales tax sharing, which was capped at $2.65 million.
The property tax rebate was not renewed after reaching its limit. The sales tax cap was not reached, according to Haney.
In the sales tax sharing agreement, the village retains the first $30,000 in sales tax, then the village and the developer split the next $125,000 evenly. After that, sales tax revenues continue to be split 50/50. That arrangement will continue under the extension.
Mayor Rich Hofeld has long supported business incentives that he believes level the playing field for economic development, allowing south suburban villages an opportunity to compete for business with Northwest Indiana and nearby Will County, which have significantly lower property tax rates.
Hofeld also expressed support for the extension.
“This particular shopping center is the envy of every town in the Chicagoland area. It’s beautifully maintained,” he said. “I fully support the ownership’s request, and I will support any future requests as quality retailers will be added.”
The vote on the extension was unanimous, but Trustee Anne Colton expressed some concern over the continuation of the deal.
“I think of incentive programs as things you use to get them in but not to be on-going,” she said. “Is this something they are going to continue asking for?”
Haney said the sales tax sharing incentive is currently used for two other businesses, Burlington on Halsted and Homewood Ford on 183rd Street. He said the village would rather use tax increment financing districts, because those help generate the money used to promote development. But, Washington Park Plaza isn’t in a TIF district.
Colton acknowledged the shopping center is an asset to the village.
“That’s one of the best parts of Halsted. It’s clean, well maintained,” she said. “I’m just not crazy about having an ongoing incentive for somebody that’s been here 20 years. We’re not in a position to do anything about it. We just lost Walmart and the casino’s not here yet. In five years I may want to revisit this.”
She referred to the Wind Creek Casino that is under construction in Homewood and East Hazel Crest near the junction of Halsted Street and Interstate 80/294. Within a few years it is expected to contribute significant revenue to the village.
