$5.4M in tax breaks sought for Wal-Mart, Sam’s Club
By Mike Nolan firstname.lastname@example.org September 16, 2013 10:36PM
Tinley Park Mayor Ed Zabrocki said Monday the village will announce plans in the next two to three weeks for a big-box retail development on this property southwest of the intersection of Harlem Avenue and 191st Street. | Mike Nolan~Sun-Times Media
Updated: October 18, 2013 6:17AM
Wal-Mart and Sam’s Club are seeking tax breaks totaling $5.4 million for a 300,000-square-foot shopping center in Tinley Park, which village officials said would generate millions of dollars in new tax revenue for the village, school districts and other taxing bodies.
Summit Hill School District 161, Lincoln-Way High School District 210 and the Frankfort Square Park District are being asked to give up 100 percent of property tax revenue they would receive from the retail center during the first 21/2 years it is open, while Tinley Park would share sales tax revenue with the stores for the first 10 years, Mayor Ed Zabrocki and village manager Scott Niehaus said.
Even with the incentives, District 161 could see $4.5 million in new tax revenue during the first decade the stores are open, while District 210 could realize nearly $2.5 million over that period, according to a draft of the village fact sheet.
Tinley Park expects its added revenue during the first decade the stores are open, factoring in the sales-tax revenue sharing, to be about $1.8 million.
Information about the incentives was planned to be posted on the village’s website by the end of the day Monday, Niehaus said.
A Wal-Mart Supercenter and Sam’s Club would be built southwest of Harlem Avenue and 191st Street, directly south of the Brookside Marketplace mall. It’s a 72-acre site, but because much of the land is in a floodplain, only about 40 acres can be built on, according to the village.
Difficulties associated with the property, including soil conditions and stormwater detention requirements, will make it more expensive to build on, which is prompting the request for tax incentives, according to the village. It says that if not for the financial help, construction of the stores “would not be economically viable.”
Tinley Park would pay $7.5 million to District 210 for the property, then immediately sell it for the same price to Wal-Mart, Zabrocki said, adding that the land would also have to be annexed to the village. How soon that might happen depends on when the two school districts and park district act on the incentive requests.
District 210 has not set a date to consider tax breaks, while the school board for District 161 is scheduled to consider the matter at its Oct. 9 meeting. The park district hasn’t set a timetable for when it would vote on the tax incentive, Niehaus said.
Zabrocki said that, under the most optimistic of time frames, the stores would be open in the summer or fall of 2015. The tax incentives wouldn’t take effect until occupancy permits are issued, or essentially once Wal-Mart and Sam’s Club open for business.
The village said the development would create and retain 550 jobs. The current Sam’s Club in Tinley Park, 16100 Harlem Ave., is closing regardless of whether the new development is approved because it is too small, and the retailer has been unable to buy land for an expansion, the mayor said.
Zabrocki pointed out that by agreeing to tax abatements, residents in districts 161 and 210 would not give up, or have to make up for, any property tax revenue the districts now receive.
The village’s fact sheet on the incentives shows that were the property left undeveloped — it’s now leased for farming and soybeans are grown there — its property tax revenue for the two school districts combined would amount to about $5,000 over 10 years.
Zabrocki noted that it’s not unprecedented for the districts to consider tax incentives. In 2008, they agreed to a 50 percent tax break over five years to keep Panduit’s global headquarters in Tinley Park.