Corporate Incentives for Sam’s Club
If you were already sick of Corporate America eating up all of the incentives, here is another one to think about. The new Sam’s Club will receive up to $2.5 million to cover “extraordinary costs associated with the project.”
Breakdown of Costs
Those costs include:
- Site preparation
- Engineering
- Regrading
- Addressing buried underground utilities
- Completing Butterfield Road improvements requested by the Illinois Department of Transportation
The total cost of the project is estimated around $19.1 million.
Structure of the Incentive
The money will come from the 1 percent of state sales taxes earmarked for the village.
- Each year, the village will retain the first $136,000 of sales taxes generated by Sam’s.
- The next $400,000 will go to Sam’s.
- Any taxes above $536,000 will go to the village.
That structure will continue until the $2.5 million is reached.
The village isn’t required to continue giving Sam’s a portion of the sales tax after 10 years, even if the $2.5 million is not reached before then.
Incentives for Bluestone Single Tenant Properties LLC
Furthermore, the board agreed to provide Bluestone Single Tenant Properties LLC with up to $587,000 to offset the cost of improving roads near a diesel fuel station the company is planning to construct later this year on the southeast corner of North Avenue and Route 53.
Scope of Road Improvements
Improvements will be made to:
- North Avenue
- Columbine Avenue
- Broadview Avenue (which will be completely reconstructed)
“Rather than us tapping into our capital improvement costs to reconstruct Broadview, we can just earmark the revenues that are generated from this project to it,” Heniff said. “They’re going to do it and then they can be reimbursed.”
Revenue Structure for Bluestone
The village will receive the first $25,000 of sales taxes generated from the business, which will include:
- Five fueling stations for trucks
- 20 regular fueling stations
- A 7,000-square-foot convenience store
Subsequent sales taxes from the roughly $7 million project will be shared equally between the village and Bluestone until the $587,000 is reached or 10 years has passed.
Frequently Asked Questions
What types of corporate incentives are being offered to Sam’s Club?
The village is offering Sam’s Club up to $2.5 million in incentives to cover specific project-related costs like site preparation, engineering, utility relocation, and road improvements.
How is the incentive for Sam’s Club structured?
The incentive is structured using a sales tax sharing agreement. The village keeps the first $136,000 in state sales tax annually, the next $400,000 goes to Sam’s Club, and anything beyond $536,000 goes back to the village, until the $2.5 million cap is met or 10 years pass.
What is Bluestone Single Tenant Properties LLC receiving in incentives?
Bluestone is eligible for up to $587,000 in incentives to help fund improvements to nearby roads required for a new diesel fueling station project.
How will Bluestone be reimbursed for the road improvements?
Bluestone will front the cost of reconstructing roads like Broadview Avenue, then be reimbursed through shared sales tax revenues. The village receives the first $25,000 annually, with the rest split evenly until the cap or 10-year limit is reached.
Why is the village offering these incentives instead of using its own funds?
The village prefers using revenue generated from the projects to fund infrastructure improvements rather than depleting its capital improvement budget, effectively making the developments self-sustaining investments.