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Developer’s sales-tax rebate request ‘pretty much dead’

DeKALB – The future of the former Lukulos building is up in the air after a plan to give a sales-tax rebate to a potential developer was derailed Monday night.

Roger Hopkins, economic development consultant for the city of DeKalb, said Pearl Street Commercial, the company that made the rebate request, has a number of options before it closes the deal on the property at 1101 W. Lincoln Highway.

“I’m sure [the developer is] just evaluating what he can do with what they had planned and what they might be able to make do without the assistance and some of the additional remodeling that they planned to do,” Hopkins said Tuesday.

Calls to Steve Schwartz of Pearl Street Commercial were not returned Tuesday. The developer had asked for the rebate in hopes of bringing a Baskin Robbins/Dunkin’ Donuts store and another retailer to the property.

On Monday, the DeKalb City Council declined to act on the sales-tax rebate request at its Committee of the Whole meeting. DeKalb Mayor Kris Povlsen said after the meeting that the sales-tax rebate was “pretty much a dead issue.”

“[The council is] supportive of the business, they’re supportive of the competition, they would love to see that go there,” Povlsen said. “They thought it was inappropriate for taxpayer dollars to move forward with the development as it relates to that particular business.”

Various aldermen had spoken in support of putting a business at 1101 W. Lincoln Highway, but many were uncomfortable about giving a sales-tax rebate for a potential fast-food restaurant.

Pearl Street does not yet own the property.

Hopkins said the company was poised to buy it after its request for a sales-tax rebate and a special-use permit (to divide the building into two locations) was approved.

Hopkins said the developer could walk away from the project entirely.

However, given the time, energy and funds already spent on the project, Hopkins said he doubts it will happen.

On Monday, Third Ward Alderwoman Kristen Lash compared the council’s deliberations on the rebate to an earlier proposal from CVS Pharmacy, which is under construction at the southeast corner of Annie Glidden Road and Lincoln Highway.

“If this were a local business, I’d be more inclined to approve an incentive,” Lash said. “But with a big national chain, I just don’t see why a national chain can’t pay $11,000 a year for this.”

First Ward Alderman David Jacobson praised the project for a number of reasons, but he described giving a fast-food chain a sales-tax rebate as a slippery slope.

Schwartz, backed by Hopkins as well an architect and the potential franchise owner, reiterated Monday that the project would make the intersection a gateway to DeKalb and Northern Illinois University.

He also warned that the only kind of business that could afford the renovations without a sales-tax rebate would be a bank. While a bank would look nice on the corner, Schwartz said the city would not get any sales-tax revenue from it.

“We’re not CVS, we’re not a national company,” Schwartz said. “We’re a franchisee and a developer at the end of the day looking to do the right thing on the right project at the right intersection where, once again, the public-private partnership benefits everybody.”

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