Council tables financing ordinance
Developers of a proposed apartment complex in downtown Springfield came to Tuesday’s city council meeting armed with a drawing of the project and ready to answer questions, but no one asked.
The council without discussion tabled an ordinance that would have provided $700,000 in tax increment finance money to build the 70-unit project at the intersection of Fourth and Madison streets. The money would be spent to buy land for the five-story building proposed by Bluffstone, an Iowa company that specializes in building student housing. Under the proposal, TIF money would account for 7 percent of the budget for the project, which has a total cost of nearly $9.7 million.
The council’s refusal to advance the proposal for public money for the project is, potentially, a deal killer, according to Bluffstone.
“We’ll have to go back to the drawing table,” said Kelly Long, director of operations for Bluffstone, after the council voted not to advance the ordinance for consideration at next week’s city council meeting. “That $700,000 is critical to the project. We wouldn’t be able to do it without it.”
Ward 2 Ald. Gail Simpson was the only council member who voted against holding the measure. Afterward, Simpson said that she would have voted with the majority had she known that there were questions about the project, including who owns the site that would be purchased with public money.
The land with an asking price of $699,300 is now owned by a trust and is being marketed by Albanese Realty. The trust reportedly includes members of the Albanese family, which has developed and operated hotels in Illinois since the 1970s, but council members have not been told exactly who is a member of the trust. Officials with Albanese Realty did not return a phone call. Dennis Albanese, the listing agent for the property, did not respond to an email.
The proposal surfaced only recently. Next week’s council meeting is the last one before Mayor-elect Jim Langfelder is sworn into office, and Langfelder says that he doesn’t favor using TIF money to buy property. Rather, Langfelder said that TIF money for the project should be released in stages as construction proceeds. And he says that the city should know the names behind the trust that owns the land.
“I’d want to know the individual players,” Langfelder said. “When you put out that kind of money, you want to know who you’re dealing with.”
Apartments in the proposed building would be marketed to Southern Illinois University medical students and University of Illinois Springfield students. The site is now a parking lot. Long has said that Bluffstone wants to start construction this year and begin leasing apartments in the fall of 2016.
Ward 5 Ald. Sam Cahnman praised the project.
“I think it’s good for the economy downtown,” Cahnman said. “It provides more of a market for businesses to be successful downtown.”
But Cahnman also said that he wants more information.
“I think we should be able to find out who all the owners of the trust are before we do final passage,” said Cahnman, who was defeated in the April 7 election and will leave office next week.
While the city mulls TIF money for new construction, at least one downtown business owner is concerned that there may not be sufficient TIF money to fix up existing buildings before the TIF district dissolves at the end of 2016. The city expects to have slightly more than $13 million to spend. If all projects that have been either approved or are on the radar screen come to fruition, there would be nearly $1 million less to spend than the city projects would be needed.
Robert Egizzi, owner of the Hilton Springfield hotel, said that he hasn’t been able to close a deal that would provide public money to repair the hotel’s crumbling parking ramp, which also provides parking for city hall. Egizzi pegged the cost at $3.6 million; according to a city list of TIF projects either approved or contemplated, the city would contribute $3 million.
Egizzi said that repairs can begin as soon as the city approves TIF money, and he’s concerned about the TIF district disappearing without a deal in place.
“It’s been going back and forth between attorneys, ours and theirs,” Egizzi said. “This is frustrating. … Let’s hope all this (TIF) money doesn’t fly out the window before it runs out.”
Cahnman said that new construction should be a higher priority for TIF funding than existing buildings, but the city somehow needs to address the Hilton parking ramp.
“I agree that we need to maintain that parking ramp,” Cahnman said. “I know that it’s been talked about for some time, that some work needs to be done to shore up that parking ramp.”
Contact Bruce Rushton at brushton@illinoistimes.com.
