DeKalb city council might rescind Target tax breaks

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DeKALB – The city council may cut short an agreement that gives Target Corp. a tax break on its DeKalb distribution center after the company failed to meet required employment levels.

The city participated with other taxing bodies in a five-year tax abatement to Target Corp., 1111 Macom Drive, where 90 percent of taxes were to be abated the first tax year after the building began operations, 80 percent the second year, and so forth.

Under the agreement, Target agreed to hire at least 500 full-time employees and maintain that level until Nov. 1, 2009. For property tax year 2009, Target employed only 434 employees, Assistant City Manager Rudy Espiritu said at a news conference Thursday afternoon.

He said the company is “fully aware” that they didn’t meet their obligations with the city, citing that the economy slowed production and caused the warehouse to downsize.

The city council on Monday can vote to rescind the agreement with Target. In doing so, the city will receive the full amount owed in property taxes.

The city will receive about $60,000 in property taxes for the general fund, an increase of nearly $50,000 over 2008 property taxes received. Also, the $395,000 that is directed into the tax increment financing fund – those taxes are paid on a TIF parcel – will be kept in city coffers rather than rebated through the TIF portion of the agreement.

The city has received one year of abated taxes, Espiritu said.

Also on the agenda:

• A consideration to phase in the new city logo for a total cost of $54,300, split over two years. The logo would mainly be implemented when things like business cards and letterhead stocks need replenishing, or when things like water towers need a new paint job. The largest cost would be $36,000 to replace entrance signs into the city.

• A consideration to start charging overweight or oversize vehicles on city roads, which could bring in $20,000 a year. Permit fees are proposed to be between $25 and $200, depending on size, weight and number of trips.

• The Employee/Retiree Health Insurance Committee will give a report and recommendation to the city council related to health care benefits. The city has discussed making drastic changes to its health insurance program to cut costs.

• A request by staff to extend a $4 million bond anticipation note for another year until the city council comes to a decision on a future police station. The BAN was issued to finance the design and engineering of the downtown streetscape plan and the new police station, and also included costs to acquire property on West Lincoln Highway to house the new station. This short-term debt expires in December unless an extension is approved.

• Three resolutions with Comcast, ComEd and Verizon would allow the utility companies to move forward with engineering work to bury utility lines on Locust Street as part of the 2010 downtown streetscape plan.

If you go

What: DeKalb City Council meeting

When: 6 p.m. Monday

Where: DeKalb Municipal Building, 200 S. Fourth St. in DeKalb

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