Orland Park backs tax split with Mariano’s
By Mike Nolan email@example.com January 20, 2014 9:30PM
Retailers, including Ann Taylor and Francesca's, are among tenants at Orland Park Crossing shopping center near where Mariano's plans to build a 73,000-square-foot grocery store. | Mike Nolan~Sun-Times Media
Updated: February 22, 2014 6:13AM
A proposal to divide sales tax revenue with grocery chain Mariano’s has received an endorsement from Orland Park trustees.
A village board committee on Monday night recommended that the full board approve the tax-sharing agreement with Mariano’s, which plans to build a store in the Orland Park Crossing mall, 143rd Street and LaGrange Road.
Under the 50-50 split, the village would turn over to Mariano’s a maximum of $1.45 million over a period of up to 10 years, but the village expects that amount would be reached sooner than that. The deal covers only sales tax revenue collected under Orland Park’s tax rate and doesn’t apply to the sales tax money that goes to the state.
The full board could vote on the matter at its Feb. 3 meeting. The agreement is similar to those that Orland Park has approved in the past for new-car dealerships and retailers such as Costco.
The inducement would also pay the store’s developer, Bradford Real Estate, a bonus of $187,000 if the Mariano’s is “substantially completed” by the end of September 2015. A Mariano’s official previously said the company expected to open the store in late 2015 or early 2016, but Orland Park officials hope the inducement could advance that timetable and start generating tax revenue for the village sooner, village manager Paul Grimes said.
Trustees in December approved plans for the 73,000-square-foot store as well as a separate development at the shopping center that would include 231 apartments and other rental housing. Mariano’s would be located near two existing restaurants, northeast of P.F. Chang’s and east of Granite City.
Mariano’s has sought some sort of financial help for virtually all of its stores in the Chicago market, according to a village document citing information supplied by Bradford.
Locally, the upscale grocer opened about a year ago in Frankfort and is planning stores in Evergreen Park and Oak Lawn. The Orland Park store is expected to cost $25 million to build.
Orland Park is conservatively estimating annual sales of $45 million for the Mariano’s, which would mean sales tax revenue to the village, before the split, of about $530,000 a year.
At the high end, based on the performance of the company’s stores in other markets, sales could reach $65 million, or sales tax revenue of about $770,000 to be divided between the village and the company.
The village expects that, even factoring in the sales tax split, it will realize between $3.9 million and $6.3 million over the maximum 10-year agreement, separate from property tax revenue.