DeKALB – The international food company DeKalb is trying to entice to the ChicagoWest Business Center is a Fortune 500 international confectionery, City Manager Bill Nicklas said.
“They make confections worldwide and they’re looking to consolidate facilities in the upper Midwest,” Nicklas said Thursday, declining to name the company, which would bring along 1,000 jobs, as negotiations still are in progress.
He spoke in a pitch to urge the DeKalb Park District to greenlight a 15-year property tax abatement program, just one of many incentives on the table for what’s being dubbed the Project Hammer Development.
Nicklas estimates in 15 years, the confectioner will bring in about $69 million in property tax revenue for the taxing bodies.
By comparison, the combined total revenue of the five major companies in Park 88 – Target distribution center, 3M, Panduit, Goodyear and Nestle – in that 15-year period, is estimated at $78 million.
DeKalb is competing for the bid against a similar-sized city in Wisconsin, Nicklas said. The DeKalb City Council will vote Monday on the same tax abatement contract. It’s an intergovernmental agreement that Nicklas said needs to be signed by the City of DeKalb, the DeKalb Park District, the DeKalb County Board, DeKalb School District 428, the DeKalb Library District, DeKalb Township, Kishwaukee College District 523, and the Kishwaukee Water Reclamation District, as well as the confectionery company.
The DeKalb County Board already has approved the measure, and the park district will take up the vote Dec. 19. The city individually offers some additional incentives, and the council will also vote on a 15-year utility tax abatement program, which would, like the property tax abatement, cut in half the taxes the company has to pay for the first 15 years.
“They have been looking for a site that at the outset would provide them with redundant, substantial and reliable electrical power because they’re going to be a big electrical user,” Nicklas said. “It happens that Commonwealth Edison has two major transmission lines [in DeKalb].”
ComEd’s power lines that would be used by Project Hammer run down Peace Road on one side from Gurler Road to Pleasant Street, and the other (currently used by Nestle in Park 88) west of Crego Road. Nicklas said they also are interested in the site’s abundance of pressurized water because of the type of production they will be doing in their facility.
Krusinski Construction Company, which owns ChicagoWest, has already built the pad for the 1.2 million-square-foot distribution center, Nicklas said, and graded the site to get it ready for the confectionery, which will have three total buildings on the site.
“They also wanted access to the tollway,” Nicklas said. “We happen to have two access points, two full tollway interchanges. So [the company] made a decision to proceed toward an intergovernmental agreement.”
Also in the agreement are clawbacks that require the company to staff up to a certain threshold or else give back a portion of the incentive, documents show. In addition to 1,000 permanent site jobs, the project also will spawn about 1,000 temporary construction jobs for the build-out.
“It’s very important to have jobs,” Nicklas said. “We’re going to give them two years to come up with full employment, and after that, if they drop down to 20%, they have to give back a prorated share. If they fall below 50% in any of the three parcels, the abatement is suspended for one year.”
With the passage of the fiscal 2020 budget Nov. 25, the city will put forward $500,000 from the water fund to construct a portion of new water main for installation along Crego and Gurler roads, and Route 23 to provide a looped water main serving ChicagoWest.
The business park also is being scouted by a knowledge-based, international tech company which could bring in an additional 200, highly skilled tech jobs, although that deal is in more preliminary negotiation stages, Nicklas said.
The City Council has in the past issued strong support for the ChicagoWest developments, and Nicklas said Thursday he believes they’re ready to support the intergovernmental agreement.
On Oct. 28, the council approved the first of Project Hammer’s proposed developments, a 1.2 million-square-foot distribution facility, with a bay for
The confectioner hopes to set up
a facility that would have 1,000 jobs by 2020 at the 343-acre site between
Route 23 and Gurler Road, with an additional 466,000-square-foot food packaging center, which would be Phase 2 of the project.
If approved and if DeKalb wins the bid, construction would have to begin on the site by June 30, 2020, according to the agreement.