That has.
economic capital development, technology development is
called to order. We will now have a roll call to establish
Quorum. Please use the iPads provided to you and Mark
yourself. Present note, that your present response will be
deemed a? Yes, vote. When this Quorum calls used as a
reference vote for later. Mr. Venegas, please open the
vote.
Mr. Blakemore, you're going to be the only speaker so if
want to wait a couple of minutes,
we want to hear from you.
Did you you voted for perfect? Thank you.
Second second.
How many people have voted? What if we'll take a, um, Voice
vote while
Our colleagues are um, signing on so we can move forward.
We have thank you. Ladies and gentlemen, we have Quorum,
uh, Alderman's Mitchell, Gutierrez chiquin Mosley, have
requested to participate. In today's meeting, remotely
under rule. 59, can I get a motion to allow them to
participate? Remotely almond, Cardona motions to allow
Alderman's Mitchell, Gutierrez Chief, and Moses.
Participate, remotely all those in favor, please say, I any
opposed say, nay in the opinion of the chair, the eyes have
it. The other person's mentioned are permitted to
participate remotely. Today, they will be marked as present
on the Quorum call Alderman Mitchell.
Alderwoman geras.
Here.
Alderman.
Present. Thank you.
Uh, for today's meeting, we did receive um, a written
public comment.
We I'm sorry strike that. Um, for today's meeting, we did
not
We did not. I'm sorry. We did not receive any written
public comments at this time, we will begin the public
comment period. Public comments are limited to 30 minutes
out of respect for everyone's Time. Each speaker is limited
to 3 minutes.
Uh, we have 1 speaker, that is signed up for public
comment. Um, within the applicable, provisions of the
sergeant-at-arms protocol. That speaker is Mr. George
Blakemore, Mr. Blakemore please proceed. When ready?
You have no public speakers.
Made it. The people been don't feel that this is a
important meeting the reappointment
of people to sit on this board.
When the people are not involved.
This is where corruption comes in.
part of your duties, as
A city council member.
Is the educate, the people.
The inform the people to engage the people of the process
you want to help.
Many people should be here.
A real.
Important to sit on these boards.
Especially SSA some of the people don't even know what a
SSA is, or are what what kind of English are you speaking?
Your job.
As an ultimate is to inform engage and Enlighten your
constituent. Sir. You have failed to today.
You all of you have failed because you failed to do this
because if you had a educated your people surely they will
be involved.
So each 1 of you maybe you are happy, maybe you don't want
them to be educated and informed and then by doing this,
you can take advantage of them.
You can start them.
the miseducation of the citizen of the city of Chicago,
You didn't know your job was uh, educator, Raymond Lopez.
You got people that in your ward.
That will speak right here on ssas and what these
appointments.
Did you inform them?
Why you didn't?
Why?
That's the big question is why?
Why is it that Mr? Blakemore is the only 1 here to speak.
Maybe it's something wrong with Mr. Blakemore
Maybe there's something wrong with you need us. And we your
job is a educator. Also to inform and engage and you didn't
do this. You you're a failure.
We have 1 public speaker.
You all of you that that are up here. You all have failed
to to get the people to come out.
Mr. Blakemore is not the problem.
You are the problem.
You're not serving your constituents, you're not informing
your constituent, you're not engaging your Constitution,
you're taking advantage of them. Thank you.
Thank you, Mr. Blakemore that concludes the public comment
portion of our meeting.
The first order of business is approval of the April 2025
monthly report, which all members of the committee should
have received at the Shared via the shared Drive. Are there
any questions or comments from the Committee Member members
regarding, uh, the report?
All right, seeing none. Um Alderman Lopez makes a motion to
approve. The April 2025 monthly report by the same roll
call vote. That was applied to the terminal Coram.
Hearing no objections sore ordered. Uh, at this time, I'd
like to invite any of the special service area.
Commissioner appointees that are present to come up front
and take a seat. Um,
please, if your name is called, please indicate your
presence to be acknowledged.
The SSA members, please sit up front, there we have. Some
other assay SSA members that are participating remotely as
well, uh, colleagues moving forward, all SSA members will
be uh, either uh, present or um, virtual in order to uh
hear questions from members of this committee.
All right, so items. Um while everyone's getting ready uhhh
items?
1 through 129 on the agenda are appointments and reappoint
of the following special service areas. The following
individuals are being considered before the committee.
uh, reappointment of Elizabeth bald, James M Ludwick and
Michael V rafti Rafi, as members of special service area,
number 18, North hosed Commission.
Item number 4, an appointment of Jenny Smith, as a member
of the special service area. Number 19, Howard Street
Commission.
Number 5, appointment of Gabriel. Sanchez is member of
special service, aerial number 24, Clark Street.
Number 6, appointment of Rajan, Shahi member of special
service area. Number 26, Broadway, commercial District
Commission.
number 7, the appointment of Patricia a Hutzel as member of
the special service area number 34, Uptown Commission
The appointment of claw. D Gibson is member special service
area number 42 71st, Stony commission. The reappointment of
panayotis Pete, valavanis. As member of special service
area number 43, Devon Avenue Commission, reappointment of
Kelly, A Smith member of special service area number 62
senos Commission,
Items number 11 and 12, our appointments of Savas ER and
Stephanie Knight Watson as members of the special service
area. Number 762-2024, North Michigan advisory Council
commission at this time, with the Department of planning
and development is available to answer any questions on.
these appointments and reappointment,
The ectd team has confirmed the support. We're not objection
from the following council members with appointment and
reappointment within their respective wards.
Alderwoman clay, alderwoman, Haden alderwoman, Harris
Alderman, Hopkins, Alderman, Lawson Mana hoppenworth
Alderman. Martin Alderman, Mitchell, alderwoman nent
Alderman. Reilly alderwoman Silverstein alderman yansi.
The appointees that are present in the room. Would you like
to make a statement at this time? Please indicate so
Yes, sir. Please identify yourself and make your comment.
I'm Jim Ludwig. And uh, North Hall said, uh, special
service area number 18,
I've been doing this for 20 years, like 5, Mayors and
stuff, and I'm honored to be reappointed. I haven't messed
up yet, I guess, but thank you for all your support for the
SSA programs. We Believe greatly in them. We do have a bit
of difficulty getting reappointed people to volunteer, go
through the process of being reappointed. And that's
something I don't have the answer to but we we sit with
Often 2 3 vacation. That each of the alderman for the areas
might come up with, to help us, get better representation,
it would be greatly appreciated.
Thank you.
Any other other members?
Hi, this is Stephanie Knight. I just wanted to Second
everything that that commissioner had said
and total agreement with everything he presented to you
all. And I want to thank you for the opportunity.
Very much appreciated. Thank you.
Any other commissioners?
I'll make his statement. Thank you.
My name is Pete. Vivani, SSA 43, Devon Avenue. I've been a
commissioner for I don't know maybe as long I I don't
remember. It's been a while. Um, I just want to say the SSA
program. I'm a big fan of its, uh, I can say that. Uh, I'm
really proud of the achievements. We've had up there. Um,
I've seen the difference and my neighbors have as well.
It is unfortunate that a lot of people uh are are citizens,
our fellow, our neighbors, don't really know what the SSA
is and does. I'm not sure how we can
Improve that but uh regardless uh our our project goes
forward and is doing pretty well. And I really appreciate
the uh the opportunity. Thank you. Thank you.
All right. Uh, are there any questions from the committee
members, Alderman, Napolitano?
Thank you, chairman. Yeah, I would actually like to make a
request to you individuals as Commissioners. Um, I'm in the
41st Ward. Uh, we don't have an SSA. We don't have a tiff,
we've tried it. Uh, we've tried to implement an SSA and
where I would implore your help is, um, there's a lot of
misinformation about how SSA work and how they affect the
residential area, um, and they don't understand how it
helps. So, to grow the SSA program in the future, if you,
if you see time, maybe you could put together kind of a, a
bio of how it helps your neighborhood. How it works? Well,
how it should be used a lot more across our our city, um,
because it really affects my word drastically that we don't
have 1. We, we've tried to implement 1 about 10 years ago
and due to misinformation, uh, residents came out adamantly
adamantly against it and understandably. Um, but if you as
Commissioners can say, hey, this is how it works properly,
this is what it affects and what it does and affect. You
know, we can not only grow the program but we could
probably bring more Commissioners into you guys as well,
and help you out. So, just an idea but I would appreciate
your help. Bringing them to, uh, the Northwest side of
Chicago as well. Thank you. Thank you.
Chairman. Thank you alderman, patano alderwoman mabor.
Thank you, chair.
Thank you Commissioners, who have been serving for for many
years and thank you to new ones who have stepped up. I I
would love to hear from my uh, newly appointed commissioner
in the 48th Ward Rajan, if you could just speak to why you
would want to do something like this on a volunteer basis,
I know you must be very busy person as well, but you know
that the 48th Ward is is Edgewater and Uptown very diverse
across race and economics. And and so, I would like to, to
hear from you, on why you would want to do something like
this.
Sure hello. Um good morning everyone. Um Rajan Shahi um I'm
the currently a little bit about me. I'm the CEO of Seva
senior care and I have also founded a nonprofit called
Nepalese Aid, which is also in is water, both business and
the uh my nonprofit.
Um, before starting my own business. Um, I was, I was the
coin term executive director at uh Chinese Mutual Aid
Association. Uh working there for 15 years and uh sir
serving families in through Chicago land and also, you
know, we have office in Elgen, so always been giving back
to the community and I started my own also nonprofit um,
little bit about, uh, why I wanted to serve, uh, in a
commissioner, uh, for SSA 26, is because it's very is
Is very close to my heart, uh, because, uh, uh, when I
immigrated back in 2009, um, the is water, is I called my
first home. Um, so that's why it's very special and, uh,
now as a business owner and also nonprofit leader, who is
giving back, uh, many years. Um, uh, you know, I I want to
see is Waters growth, uh, and its success. And with my
leadership and with the connection and uh uh, with the
nonprofit background. Uh, I want to contribute and uh, just
do what I could, uh, to improve. And, you know, uh, growth
of as water.
Thank you. Thank you for stepping up Rajan and and thank
you to all the Commissioners here and and online. And who
have served in the past that uh, you truly are making
decisions to make our communities better. And so I I
commend you. Thank you.
Thank you, Alderman. Any other colleagues have questions?
All right. Uh, thank you again for
Um your uh civic duty of uh participating on the ssa's. Um,
we value the work that you men and women do are doing on
on the ground. The corridors are important to us, uh, and
hearing, um, from you on a regular basis is important as
well. So I would recommend that, um, at any time, please
feel free to reach out to my office and we'll be more than
happy to take a look at how we can help. Uh it is important
again that those corridors continue to thrive continue to
create revenue for the city uh and and uh be put in a
position to to be destinations for residents, throughout
the city of Chicago. So thank you for your service to the
city.
Thank you. May. I have a motion to recommend approval of
the appointments and reappoint by the same roll call vote.
That was applied to determine Quorum ottoman cardono. So
moves here in no objection. So ordered the due pass
recommendation of the appointments and re-appointments will
be reported out the next city council meeting. Appointees,
congratulations on your confirmation and partnership with
the city of Chicago. We look forward to working with you.
Thank you. Thank you.
Um, item 13 on the agenda is an ordinance on a class 6B tax
incentive for property at 2519 West, Fulton Street, and
2520 West Lake Street in the 27th. Ward Jeffrey Cohen,
Deputy Commissioner for Department of Planning. Development
is here to present in support of the item and we'll be
available to answer any questions. We also have members of
the development team available to answer any questions. Mr.
Cohen, when you're ready, please begin the presentation.
Thank you, chairman.
Uh, good afternoon, chairman viegas members of the
committee for the record. My name is Jeff Cohen. Deputy
Commissioner in the department of planning and development.
I'm here today to request your support for an ordinance
authorizing, an initial Cook County class 6B property tax
abatement for Kinsey Commerce development.
Uh the project is located at 259, West, Fulton and 2520
West Lake streets. This is located in the near West Side,
Community area, the 27th board and West planning region.
Alderman, Bernett has expressed his support in writing.
Uh, the subject property is bounded by West Fulton Street
to the north and Ally to the East West Lake Street, to the
South and North Maplewood Avenue to the West.
2519 West Fulton Street contains approximately 25,000
square feet. That was previously used by eagle grinding
wheel. Corporation for the manufacturing of custom grinding
wheels. It has been condemned by the city of Chicago.
2520 West Lake contains approximately 25,000 square feet of
improved of of a of improved facility uh and it is a
100-year-old building that is currently being used for
steel fabrication. This structure requires extensive
repairs.
Uh, the next 2 slides demonstrate, the current conditions
of the site and structure.
Uh, here you can see uh, the loading, docks and Exteriors.
And in this, uh, the Interiors of the existing facility.
the applicant requesting an initial 12-year Cook County, 6B
property tax and abatement, which is essential to
attracting tenants to the city. Given the reduced costs of
operating in Suburban counties, in Northwest, Indiana,
The applicant acquired the subject property in January of
this year and plans it to the existing structures
approximately 50,000 square feet in total. In favor of
constructing 2, new modern industrial buildings, totaling
68,000 square feet which can accommodate up to 8,
individual tenants. The developer is working with CB to
market the space and is actively listing it
The project is expected to cost approximately 18.8 million
and the total estimated tax savings for the applicant over
the 12 year period is approximately 1.86. Million
construction is anticipated to commence this summer with
completion in the summer of 2026.
The drawings on the next 2 slides show. The approximately
69,000 square feet of Industrial Development.
Each building will contain 1 interior Dock and drive in
drive indoor for each demise space up to 8 of each in
total. And then parking spaces will be used by occupants of
both buildings.
The development team plans to invest approximately 18.8
million. Sorry, this is uh, exterior rendering. Sorry.
Uh, the development team plans to invest approximately 18.8
million in the site and is fully financed with equity and
debt. The developer has significant experience owning
developing and building projects of this nature having
built over 10 million square feet of industrial space
throughout the country. Uh, since 2018,
as a previously stated the estimated tax abatement to the
developer is approximately 1.86 million uh 1.4 million on
the npv basis over the 12 year period with the city, share
estimated at around 430,000.
Uh, supporting a 6B incentive for this property will result
in several positive outcomes for the City and surrounding
Community, including the accommodation of up to 8, new
industrial, tenants in the area retention of the industrial
nature of this area with anticipated, light, industrial
users and staying competitive. We are not with the nearby
locations in Indiana and the surrounding suburbs.
Specific benefits to the city include Redevelopment, and
activation of a deteriorating 2 and a quarter acre site,
creation of at least 20 full-time, equivalent positions and
up to 256, temporary construction jobs, also the
revitalization of the area through developer tax savings of
more than 1.8 million. While still, increasing property
taxes over the current rate during the 12- year. Period,
uh, this will also support, uh,
Support for minority and women-owned businesses throughout
the construction process.
I'd like to thank you for your favorable consideration of
this matter. Uh, I am joined with us today uh by Seth
Halpern and Jared Ruben of the development team and Peter
nicastro from dla Piper their Council. We are happy to
answer any questions members may have for the team.
Thank you. Uh Jeffrey uh almond Bernett has provided a
letter of support for this item. Are there any questions or
comments from members of the committee?
Seeing none, I have a motion to recommend pass of this item
of the same role. Call those apply to establish quorum.
All woman lie makes so makes that motion hearing no
objection. So ordered the do pass recommendation will be
reported out the next city council meeting. Thank you.
Item. 14 on the agenda is a class 6B tax incentive for
property at 838 patent Drive in the 41st, Ward Jeffrey
call. Deputy Deputy Commissioner for the Department of
planning and development is here to present in support of
the item and we will be available to answer any questions.
We also have members of the development team available to
answer any questions. Mr. Cohen, when you're prepared,
please begin the presentation.
Again, good morning chairman viegas and members of the
committee uh for the record. My name is Jeffrey Cohen.
Deputy Commissioner for the Department of Planning and
Development. I am here today to request the approval of an
ordinance supporting an initial 6B property tax incentive
for arrows. Chicago 2 LL uh for the property located at 838
Patton Drive
The project site is located in the 41st Ward within the
O'Hare community area, Northwest planning region. Uh,
Alderman. Napalitan has expressed his support for this
incentive.
Shown here is an aerial view of the Northwest cargo
facility, which is situated in the northeast corner of
O'Hare complex. The subject property under consideration
today is the area, highlighted in red. The area highlighted
by yellow uh by yellow Dash lines are the other 2 phases
developed by the applicant.
Uh I thought it was important to provide a little
additional context on the northeast cargo facility as well.
Um the completion of this project which is uh phase 3
marks, the culmination of a nearly 20-year process to bring
the Northwest Northeast cargo facility to fruition. Uh this
Uh, this process started in 2008 when the city issued an
RFP to redevelop, a former decommissioned military base on
the O'Hare Air Base, uh, real term formerly Aero term was
selected as the winning bidder and their proposal split the
Redevelopment into 3 phases, the first 2 phases, and a fuel
Farm were delivered in 226.
15 and 2017 with phase 3. The subject of this incentive
request delivered in 2023 and fully operational in summer
of 2024. In total the Northeast cargo facility total 65
acres, 900,000 square feet with positions for 13 of the
largest group, 6 B, 478 F, cargo aircraft. It is important
to note that each phase of the development. Redevelopment
is subject to its own ground lease. The phase 3 lease was
executed in January 2021 and commenced in 2023 for initial
305 year term expiring in 2058
As part of the phase 3, ground lease, the city indicated
support and facilitating this class 6B property, tax
incentive, and in total across all 3 phases, the ground,
leases provide, the city with additional Revenue. Uh, this
is via the base rent of the ground lease as well as a 3%.
Net rent participation from the lessee's of the facilities
between the applicant and tenants.
On average the revenue to the city from this structure is
approximately 7 million annually and over 245 million over
the initial lease terms. That's in today's dollars.
The revenues from the ground lease. Also the, the revenues
from the ground. Lease structure will also be supplemented
with additional revenue generated from Landing fees. As a
result of the increased cargo traffic at the airport,
supported by all 3 facilities, being open and operational.
Sorry, 1 sec.
Uh, here's a slide shows in an aerial of the entire
Northeast cargo facility looking East identifying. The
completed buildings by phase with the subject property for
this request again. Outlined in red, in addition to the 3
vertical developments, that applicant also improved nearly
450,000 square feet of the former military Brownfield with
new concrete, paved taxiways, providing additional
connectivity to the other facilities to the north, as well
as the ohare field taxiway to the West. It also created an
extension of an access road to the southeast connecting to
patent drive. This location also provides easy access to
Runway, 9 to 7 that 27c 1 of the 2 dedicated cargo runways
at O'Hare.
Uh, the incentive applicant is Eros, Chicago, 2 LL, a
special purpose, entity of real-term formerly known as Aero
term. This entity is the groundless sea for the land where
the property is situated and has entered into an agreement.
For the leasehold, improvements with Worldwide Flight
Services acting as the tenant
As the primary tenant operator of the constructed facility.
Uh, the subject property consists of approximately 132,000,
square, feet of Class. A are to Freight industrial
warehouse distribution facility uh marking the third and
final phase of the Northeast cargo complex. Uh that
developed the unused form military base,
uh, using the first 2 phases as comparables dpd projects,
the estimated tax savings to the applicant from this class
6B incentive to be approximately 6.3 million over the 12
year, period or 3.78 million on a Net Present Value basis.
There's a total net benefit to all taxing districts of
approximately 5.35 million.
Uh, total project costs for this. Third phase was 52.3
million with construction. Having commenced in July 2021,
with completion in April 2023, and full operational ribbon
cutting and August of 2024,
Uh again, as noted earlier, this development will also
provide additional Revenue to the city. Via the ground
lease and rent participation of approximately 7 million
dollars per year and additional Revenue, increasing in
additional revenue from increased Landing fee Revenue uh
from The increased Air Cargo traffic
this project was funded, uh, by 38 million of of this
project, consisted of 52.3 million in total project cost,
including 38 million of hard costs, 6.4 million of soft
costs and about 7.8 million of additional infrastructure
work. The project was funded with 44 and a half million of
equity from the applicant and included City, reimbursement.
from the Chicago Department of Aviation for sub projects
related to the re sub projects, related to the development
such as pfas, remediation, new and improved utility
infrastructure, South Access Road improvements and airspace
perimeter work.
uh, in addition to the 133,000 square foot, industrial
building, the property features, 154,000 square feet of
total airplane. Ramp parking, uh, for up to 3 Air Cargo,
uh, uh, bra airplanes.
Uh, this also includes around 43,000 square feet of ground
support equipment. As you can see on this Slide, the
facility includes a total of 32 dock doors, including 26
truck, doors, 4, airside, loading doors and 2 Drive-In
doors.
Uh here is a photo of the truck side of the facility uh in
addition to the 32 docks, the property features 24 foot
ceiling, clear Heights uh and 10,000 square feet of
mezzanine office space. Uh it is also can accommodate up to
104 parking spots.
Uh, shown here are the 3 Air Freight spots with 4 airside,
loading docks. Uh, this configuration can accommodate up to
a dozen, jumbo Freighters per day and processes more than
100,000 metric, tons of cargo per year.
Uh, and here is a picture of the entrance to the completed
project.
I was previously mentioned the applicant is a special
purpose entity of real term formerly known as aeroterm.
Real term is a developer and operator of Transportation of
real estate and infrastructure assets that serve Land, Air
sea, and rail networks across the world. Real term was also
responsible for delivering the first 2 phases of the
Northeast cargo complex in 2016. And currently managed 11
facilities on the Airfield, as well as the fuel Farm.
uh the applicant has contracted with Worldwide Freight
Services also wfs a global Air Cargo Logistics leader and
best-in-class ground handling partner. Uh as the master
tenant of this facility, wfs is responsible for the
day-to-day management and operations of the facility and
Contracting with over 270 air cargo carriers to utilize the
facilities. Uh, it is estimated that the 3 facilities
combined will handle nearly 33% of all Air Freight Cargo at
O'Hare on an annual basis.
Uh, that's the made to 12 year tax savings to the applicant
as approximately 6.3 million of, which the city share is 1
and a half million uh, or 4.7 million on a or 4.7 million,
um, total and 1.1 million on the Net, Present Value basis.
Uh, as the property was previously exempt, uh, generating,
no, real estate taxes. There's an estimated net benefit to
all taxing districts of 5.35 million over the 12 year
period, or approximately 3.78 million on an MPV basis.
Uh, dpd is in support of this project that enhances
Chicago's position as a leading Global shipping hub, while
stimulating job, creation and economic growth in the
region, the project estimated to create 175 full-time jobs,
and 250 construction jobs currently employs approximately
200 uh full-time positions at the facility.
Additionally, the developer achieved a 55% MBE and wbe
participation rate in total. 23 million was contracted to
minority or women who owned firms, 20 20% being
African-American 18%, Hispanic and 7% of Asian descent. Uh,
the remaining 10% was contracted with women business
enterprises.
It was also the first major are Car Airport cargo facility
to be built by an African-American Le construction team.
And it is also projected to create 2,200 ancillary cargo
related jobs throughout the region.
Uh, the investment in impact of this is also important to
note as well uh, with the completion of the 52.3 million
phase 3. Real term is invested nearly 175 million to create
the Northeast cargo facility from a former unused military
Airbase.
uh this helps O'Hare process over 1.9 metric, tons of landed
Freight uh in 2023 ranking at seventh globally in terms of
tonnage and that cargo was also valued at 300 billion
billion making O'Hare. The number 1, ranked Air Cargo port
in terms of value for cargo delivered throughout the
country. And again, 33% of the total metric tons is handled
by these facilities.
Again, this also this the project also activates a
previously, exempt property generating, a net benefit to
the taxing districts, estimated to be 5.35 million over a
12 year, period or 3.78 on npv basis.
Uh, the abatement is a pass through that lowers, the
overall occupancy and operating costs for the tenant and
Air Cargo services provider, uh, creating an inducement for
additional tenancy, uh, that concludes my presentation.
Thank you for your favorable consideration of this request.
I'm also joined today by David Rose from real term, John
Dairy with WF wfs and their Council Mark Rogers of listen
and santis.
I, as well as the members of the development team are happy
to answer any questions. The committee may have
Thank you Jeffrey. Um,
Uh, I now recognize ottoman Napolitano who would like to
speak in support this item. Almond, the politano.
Thank you, chairman. Uh, I do support this. I'll make this
very brief. Um, I just like to thank you for supporting the
growth and strength of O'Hare Airport. If O'Hare Airport,
doesn't grow and maintain, its Transportation needs of, not
only people and cargo it will become irrelevant.
What you are doing is to help keep O'Hare.
In the city of Chicago, as a trans as a transportation
transition point, for the entire world, we appreciate this.
That's why I support this last but not least. Thank you for
putting people to work when it's needed. Most
As I support this. Thank you chairman. Thank you, Alana
alderman waguespack.
Thank you, chairman uh thank you for the presentation. Mr.
Cohen. Um, did was it 3 or was it 4? Air Cargo ramps. Uh,
so it can handle 3 planes at a time, but there are 4
airside doctors that can be utilized when there's, uh,
airplanes parked their excellent, okay, I misread that
then, um, thank you for the presentation. And um, I also
support this. Uh, I think it's an excellent project and are
really, um, ramp up. So to speak the the cargo that we're
seeing there, um, and, you know, continue to improve on
everything that happens at O'Hare. So I appreciate all the
work that you all put into this. Thank you very much. Thank
you. Cheryl. You killed him as August back. Alderwoman Lee.
Good morning everybody, and thank you for the presentation.
Um, I'm also in support of, uh, of the 6B, um, having
worked for United Airlines prior to coming here. I, I
understand, uh, just like, uh, Alderman Napolitano and so
many others here, the importance of cargo business, uh, to
the city of Chicago. Um especially through coid it was a,
the 1 bright shining part um, of Co for us was that cargo
was still flowing, um, and much needed Cargo in fact, so
the growth at O'Hare is really important, um, happy to
support this tax. Incentive to ensure that we continue to
do this. Thank you, thank you. Ultimately, any other
members uh have any questions or comments?
All right. Thank you.
um,
seeing no other questions. May I have a motion to recommend
a pass of this item by the same role. Call that was applied
to establish Quorum alitan so Mo's hearing no objections.
So ordered the do pass recommendation will be reported out
the next city council meeting. Thank you. Thank you.
Alright item 15 on the agenda, the final item is the
presentation from William Jeffrey's managing Deputy
Commissioner of the Department of planning and development
on the Department's tax incentive applications review
process and the presentation on the tax incentive
recipients annual compliance report.
Mr. Jeffries. When you're available or ready? The floor is
yours sir.
And The Voice.
and before you start, um,
Uh, Jeffrey. This is this is a um,
A request that came from some of the members around, uh,
the department, um, analyzes and selects 6 BS uh and that
that whole process. And so I thought it was, uh, crucial
that the newer members that they get in a crash course on
tax incentives. Uh, so that way, uh, as you're thinking
about your ward and trying to, uh, spur Economic
Development, that's 1, look at the tools. We you'll know
about the tools in the toolbox
Good.
Uh, yes, good morning, chair, Vegas. And members of the
committee for the record. My name is Tim Jeffries managing,
Deputy Commissioner in the department of Planning and
Development, uh, at the request of the chair, I'm here to
provide an overview of the various, uh, property tax
special classification incentive programs, the overall
review process, and the 2 year summary of the program,
uh, I know this body is generally familiar with these
programs but uh, the property tax incentive or PTI. Program
is a series of, uh, Economic Development tools that were
originally authorized by Cook County in the late 1970s,
with the goal to encourage the Redevelopment of vacant and
underutilized Commercial and Industrial properties.
Uh this is done by providing eligible projects with a
meaningful tax abatement. 60% uh, reduction of a properties
nominal or a projects proper 12. Nominal property taxes
generally over a 12-year term. Uh, these programs are
authorized by the Cook County Board of Commissioners, but
are administered by the Cook County assessor's office in
coordination with local municipalities.
Um the PTI program is not a single incentive, um rather
they're a series of distinct programs. That each have
specific focus and similar. But often Divergent rules, um,
these include, uh, the class 6 B program which is offered
to Industrial properties and is the most utilized, uh,
incentive program. Uh, the class 7, a b and c programs are
all offered to commercial users. Uh, class 7D is 1 of the
newer classifications and is specific to grocery stores and
food deserts, uh, the Class 8. Allow municipalities to
designate a specific area as being in need of
Redevelopment, which then allows them to qualify for a
class A incentive. Uh the Class 8 micro is very similar to
a Class 8 but is limited to the uh, Illinois Quantum and
micro Electronics Park in the South Chicago neighborhood.
Um, Class C is available to projects. Requiring
environmental remediation, and last is class L, which is
provided to projects redeveloping, a designated City of
Chicago Landmark. I'll just note that that 1 program class
L is not administered by the, by departments Bureau of
Economic Development. It's from the Department of the
Bureau of historic preservation. So my comments will
generally be limited to not that program.
Um, although these are each distinct unique programs with
specific rules rules and requirements. They are also
similar to 1 another because they rely on the same
mechanism to provide a financial incentive.
Um, to describe that benefit. Um, I'll start with this
simplified chart showing how property taxes are calculated
in Cook County. Um, just at a very high level, um, the, the
assessor's office will first establish a property's fair
market value or FMV, uh, that FMV is in multiplied by a
Project's assessment rate, and then the state's
Equalization factor, and that results in the property's
annual equalized, assessed value, or EV. And then, finally,
the eav is multiplied by the local tax rate, which gives
the final tax bill.
Um,
these programs work in that system, by reducing a Project's
assessment rate shown here, uh, under a typical
circumstance commercial or industrial properties, have an
assessment rate of 25%, uh, however, when a property is
granted a special classification. Assessment rate is
lowered to 10%, which is a 60% reduction of the real dollar
property tax bill.
Uh, this benefit remains in place for 10 years before, uh,
increasing to a 15 and a 20% assessment rates in years 11
and 12 respectively. And then, the property returns to a
full um, uh, assessment when the classification expires at
the start of the 13th year. Uh, that said many of these
programs do allow for extensions which could provide an
additional 12 year benefit
Um, I'll note that the assessment rate is the only Factor
that's modified. Uh, as the result of this incentive
properties are still subject to try any all reassessments.
They can still appeal their taxes and they are still levied
at the same rate as other properties in the city of
Chicago.
Um, in order for, uh, projects to receive this benefit, uh,
they must go through the general approval process
identified on this slide. Uh, this includes reviews by both
the county and the city, uh, and that is because although
these are ostensibly County programs, the county code
requires that a Project's application, include an
ordinance, from the local municipality affirming, its
support of the use of the incentive. So on this chart
County actions are in blue. While City actions are
ingrained
Uh, following the submission uh, of both of an application
to both the assessor and the city dpd's. First action is to
provide written. Notice to the subject Alderman and asked
for their input and feedback on an application. Um that
application is then subject to a review by dpd staff to
ensure that the project is eligible and able to move
forward. Um I'll Define that criteria. What that criteria
is exactly in the following slide, um, but once our review
is complete, and a recommendation has been made to move the
project forward dpd. Will again, notify the subject
Alderman of this determination and Our intention to
introduce legislation. Uh, before that happens though, dpd
finalizes the legal elements of the ordinance including
reaching consensus on a Redevelopment agreement or RDA. Uh,
this defines the minimum thresholds for Investments job
creation and construction compliance requirements. Uh, once
a project is uh then approved by city council, the
application moves back to the county and is subject to
further review and approval by the assessor's office. And
in some cases May, um,
Require additional approval by the County Board of
Commissioners.
Uh,
uh, while that represents the process as a whole, I'll
provide a little bit more detail on the specific elements
included in dpd's review.
Uh, as I mentioned these programs can and do have very
different eligibility requirements. This means that dpd's
review varies between projects um, that said there's 4
factors or tests that generally apply to all PTI
applications. Uh, regardless of programs.
These are each legal requirements that are specifically
identified in the programs and enabling legislation in the
in the County's code of ordinance. Uh and our um first
confirming that the project that the Project's proposed,
use meets the primary purpose of the relevant program, uh,
that exact purpose between programs, but each of them does
have a primary focus that must be addressed just as an
example. This would include uh that only industrial
projects are eligible to apply for a 6B. Um, so if a
project applies a commercial project and applies for 6B,
they would be denied or at least routed to the appropriate
program.
Uh, second is determining, if a project involves either new
construction, the substantial rehab of existing property,
or the reoccupation of abandoned property, uh projects are
only eligible in as much as they result in Redevelopment or
reoccupation of a property. So our review here focuses on
ensuring that a project scope is sufficient to uh be
considered substantial a project with very minor our
cosmetic repairs such as painting. It would not meet that
test would not be eligible. Uh additionally this review May
uh include a product which has been vacant for a long
enough period to meet the County's definition of abandoned.
Uh, next is verifying that an application was submitted on a
timely basis. The county has various requirements around
when applications must be submitted typically, before the
start of construction or reoccupation and we ensure that
these headlines have been met and then finally the city's
required to affirm for all projects that the use of the
incentive is necessary for the project to advance and the
development to occur. This typically revolve involves a
review of the Project's finances. The development budget
and the market conditions.
Uh, in addition to those Universal factors, there are other
elements that is considered that are considered when we're
reviewing projects. Uh, in some cases, these are program
specific specific requirements identified in the county
code that uh, uniquely apply to a specific program. Uh,
highlighting just a few of those. Um, the class 7A and B
projects must be located within an established.
Redevelopment area Class. C must be located in a USDA
defined food desert Class. C projects. Must have had no
further remediation letter issued by the ieepa. And uh just
generally the ability to renew these programs has a high
degree of variability. Some can be renewed indefinitely
While others, uh, just once or never. Um,
in addition to those County specific elements, the City
reviews, um, other factors in an application, including the
ratio of the estimated savings to the total Investments and
the number of jobs created or retained. Um as well as other
public benefits, that may be created. Uh and those factors
are important because of the city will also consider. If a
project can reasonably meet the requirements in a city's
RDA, including mwbe compliance, uh on the basis of these
factors dpd makes a determination if an application is
eligible and should be Advanced to the next stages of the
approval process that I previously described.
Um,
and just to provide some context on the the number and the
volume of projects that go through this process. Um, over
the past 2, full calendar years, meaning January, 1st 2023
through December, 31st of 2024, uh, the cities received a
total of 45 applications for these property tax incentives.
Uh, the chart on the right or left rather shows the general
status of where things, sit for those but that includes 20
by city council. Um, 5 applications were withdrawn at the
applicant at the request of the applicant and they're no
longer being considered uh 3 applications were determined
by dpd to Simply Be ineligible and then 10 of them. Uh they
remain actively under review and maybe Advanced to city
council at a later date.
Uh also shown here is the uh on this map are the 35 projects
that were approved by city council over that same time
period, in 23 and 24. I'll note that the number is slightly
different because this reflects actual Council approvals,
regardless of when the application may have been submitted,
um, and these projects are projected to have a significant
impact once they're completed. Um, the cumulative value of
the tax abatement provided through this program is 90
million, but they will result in nearly, uh, 690 million of
total investment in Chicago's neighborhoods. That's a ratio
That's a ratio of of 7.50 cents of private investment for
every city, a dollar of taxpayer abatement that's going in,
Um, they also have a very significant job component, uh,
and our, our estimated to result in the, uh, creation or
retention of nearly 6,000 jobs.
Um, and I would also add critically. This this impact is
being done in an equitable manner 80% of the projects that
were approved by Council are located in community areas
that are either on the South Southwest or west side of the
city.
Uh it's also essential the dpd that we ensure that Pro
approved projects are holding up on their end of the
bargain and delivering on the promises and commitments that
they use as the basis of City council's approval. Uh, that
effort was significantly advanced in 2020 when city
council, uh, with the leadership at Cherry Vegas approved
an amendment to the municipal code that requires most
Project PTI projects to enter and into an RDA with the city.
Uh, this ensures that projects meet the minimum level of
investment, job, creation figures and MBE mwbe
participation that formed the basis of the review and
approval. Uh this change resulted in dpd beginning an act
monitoring of PTI projects, including the collection of
annual reports in 2021. Uh
In 20124. Uh, we collected a total of 19 projects were
subject to these requirements. Um and at this point it the
reality of the construction Cycles is that most of them
have not yet been fully completed uh and have not been able
to provide us with full data. Um but that said the outcomes
from the first set of projects that I have is promising uh
3 projects. We have 3 projects that have been fully
completed and each of them have exceeded their mwbe
requirements and have resulted in the creation of more than
600 jobs.
Uh we expect that as more projects are completed, the state
will become increasingly robust and we are now starting the
2025 annual report process and believe that more projects
will be begin to provide the data this year. Um, once that
annual report, uh, effort is complete. We'll provide the
committee with a compiled summary of that data in late
September.
Uh, and finally, um, I think that we believe that these
outcomes associated with the PTI program are positive, but
I think we're still cognizant that there's improvements and
efficiencies that could still be made, um, specifically
addressing 3, high level issues, could create immediate
operational benefits for both applicants and the city. I've
identified those in the left-hand column but I can briefly
touch on each of them. Um, as I said, in multiple times in
this presentation, there's many PTI programs and they have
small, but significant, uh, rule differences between them.
This really can make Pro the programs difficult, uh, for
businesses, especially small businesses to understand the
totality of the program which creates barriers to entry.
And in the, at the end of the day, dpd doesn't believe that
it's reasonable to expect small business to become an
expert on these programs simply to apply uh, or even
understand what they are.
Um these varying requirements also represent,
inconsistencies between programs, which could make a
specific incentive either easier or harder to secure than
others. Um, this also creates loopholes that allow some
projects to avoid City. Requirements that we would
generally wish to enforce just as an example Class. C
projects have an extremely low threshold of investment and
are not subject to the RDA requirement. So an applicant
could legally be allowed to make a minimal investment. That
is not commensurate with the level of tax statement that
they're receiving while simultaneously not being
Subject to job creation MBE wbe participation or annual
reporting requirements.
Uh and then finally there's just a lack of clear
information resources on these programs.
Uh, what does exist is generally lacking because they're
either too high level. They don't describe the process as a
whole and they don't identify cities specific requirements.
Uh, dpd we are always willing to be a resource but we know
that people may be hesitant to reach out if they don't if
they feel like they don't even know what questions to ask.
Um,
these issues aren't insignificant but we believe that they
could be addressed by implementing 2, programmatic changes.
Uh, the first would be to attempt to consolidate these
various program rules in order to have common rules and
regulations to the greatest extent possible. Um, just to be
clear creating a single program. It is impossible, uh,
because of so many factors that are outside of the
legislative control of the city. Um, but there are elements
that we could that we could consider to to make them common
including in uh instituting minimum investment thresholds.
Uh uniformly applying review standards and formalizing
renewal requests. Uh I'll just note that this approach is
extremely similar to what dpd did last year uh with the
consolidation of our Capital grants program that has been a
success. Um we would then build on this by publishing a
series of comprehensive guides for each program. The person
purpose of these documents would be to have a single, uh,
source that outlines all of the city, all of the county and
City requirements, and also defines the overall review and
approval process.
With the goal of lowering barriers to entry.
um, we believe that these changes would provide a
significant benefit by improving transparency and
communication, streamlining, internal operations and
addressing these loopholes, um, in the past we've discussed
these, uh, concepts with Cher, vagus, uh, and we would be
willing to present a draft, uh, uh, presentation of
Concepts to this body at a future meeting for, uh, review
and feedback. If if requested
Um, so that uh concludes my presentation and I am happy to
answer any questions that the committee might have.
Thank you. Uh, Tim for that for this presentation 2, quick
questions, the 7 dollars, 50 Cent investment to the dollar
um, tax break.
What's like the industry standard? Is that good bad? Is
that what? What do you what do you take? What's your take
on that? Uh,
I don't know that we have a what I would consider an
industry standard. I can get you provide, you through the
chair through yourself uh like what what the relative
numbers would be for like our CDG medium and large program,
but
My gut says that's a great number. Yeah that's a lot of
money that's that's a 7 almost 8X return. So it's that's
what I'm saying. I I think that's a good number too. As it
relates to um some of the solutions for information, have
we taken a look at incorporating AI as an opportunity to
leverage that technology to allow public to say, like a
chat GPT or something like that to ask, hey, I'm going to
apply for this type of program or
or I'm thinking about this type of investment and then allow
AI to kind of uh uh answer that question for you and give
you some insight, but still require them to obviously, come
to you. But at least they would be be a little bit more
well-versed on the application process. Since you said
Since you said that, there's a lot of nuances between
these, I guess my concern with something like that would be
that. I don't know that.
The information to train an AI even exists today. So it's
like we could, you know, do some of these resources I
could, you know, we could query it with AI and how it
stands today. But I think that what they people would get
back would be
would be minimal and they wouldn't be as useful as it could
be because the data that that we're talking about just
isn't out there right now today and it should be
gotcha. Okay. Uh, are there any questions from members of
the committee Alderman wages back?
Thanks, chairman. Good question. Um, the uh, I guess my
questions were a little bit around pop Beyond publishing
the guidelines and maybe talking about AI.
When the 35 applicants came in the ones that were awarded,
um, did they already know about it? Or did you have to
inform anybody? Like look we can give you this incentive as
well or or how. How did those numbers kind of pan out? Um,
Are you you know educating somebody, when they come in to
say, by the way we could get you this other incentive to
close the gap. I think the
I don't have specific, you know, percentages, I give you
right now but anecdotally I I think the the the majority of
them call them 80 80% uh coming on their own uh the
remaining 20% are projects that um you know we might have
we have a project, a grocery store on the west side, that
is in process now and I know that we
It's a grocery store, it's the west side. It's a, you know,
local independently owned thing and we we proactively told
them like this 7B exists. You should really be looking at
it as a resource as well. Um, and then occasionally we also
have um, projects that we they come in for the capital
Grant and we tell them
This is maybe not the best pit fit for for a capital Grant,
but we have this other program available that provides a
like still substantial benefit but it might be a better fit
for you. Um, and do they need? Um, I mean I don't think
they do but uh, are you kind of helping them through the
legal process for doing all this, as well as opposed to,
you know, you see, most of the people that come in, they
have, um, development teams that are have significant
experience and they probably have an attorney with them.
And it seems like the ones we get, you know, that you see
the attorney doing a lot of the work. So you guys actually
doing the work for some of those uh
you know, smaller groups that might not have the
Capacity to do that. A short answer.
is, yes, I think we try to meet people where they are, if
they have a
A a development team. Then we'll work with their
development team. And if they don't, well, we we never tell
people. It's like you must have an attorney to do this. Um,
We just try to give them the guidance. We can't make
decisions for them and we, we don't want to. We never want
to insert ourselves into their business. Because as their
business, they have to, you know, they have to make the
right decisions for their business. No matter what long
after the city is gone, but we still
Work with them to, to get them to the point that they that
they can come in front of this body.
Okay. Uh, thanks and I think that information resource
effort will be very beneficial. Um,
It's interesting. The county doesn't really.
Have that same kind of packaging in. In fairness to the
county, they they do have some of this stuff but these
these um uh incentives. Apply to all 15040, whatever
municipalities throughout Cook County. So the information
that they provide
Just sort of needs to be at that level as applicable to
every single 1 of those communities. I think it's, you
know, it is up to us to to, to take that synthesize it and
say, this is the standard that the city has
Okay, thank you very much. And then maybe piggyback off
Alderman while I get back. So, um, when I worked in state
government, we started, we, we had a issue with folks
submitting applicate, uh, applications and documents that
we needed. We started doing some YouTube tutorials, uh, and
allowing and pointing people towards those YouTube channels
to say, hey, if you're going to apply for this incentive
and then we had an actual expert from the Department. I
would actually walk through the majority of it, of, of, uh,
the information. So that way, uh, it would give them a head
a little bit of a leg up when they submitted a lot of that
documentation, or or information would be, would be
already, uh, submitted to the dpd for for consideration. So
again, a recommendation of potentially doing some type of
YouTube tutorial, uh, might make it a little bit easier for
folks. Yeah. Any other questions from uh all woman? Mors?
I'm sorry. Sorry. Uh, yeah, I will just we'll we'll
definitely take a look at that. We actually just last week
posted our refreshed version of exactly what you're talking
about, the CG medium program and
Advance of the round coming up. So we will take a look at
it for the, for the this program as well. Thank you. I'll
have more.
Thank you, chair, and thank you, Tim for for the
presentation. I'd love the deck. If you, if you can send
Uh thank you. I I just want to clarify that these
incentives are for commercial properties or yeah,
commercial or industrial properties. Uh, the benefit, if I
could just hop back here to, oh, I'm not not providing it
anymore, but presenting an any more but the, uh, oh, thank
you.
uh,
if you see here, the assessment rate, if it lowers it from
25 to 10, um, 10% is what Residential Properties are at
normally. So this really just treats, these industrial
commercial properties like residential ones. So, um,
The way they exist. Now there's no that they're already
getting the benefit of it. There's other programs that
exist like, the 8020, um, tax change that happened in
Springfield a few years ago. Um, but those are generally
overseen by the Department of Housing.
There is a program though, a newer program, the low
affordability, Community low affordability. That's the it,
yeah, it has been called 8020 in the past but low
affordability is the better name? I think now. Uh, yes,
that is, uh, that's that mechanically is different than
this. Um, and uh, I have a write up. I can provide you um,
if you'd like, um, but that 1 is overseen by the Department
of Housing
Yeah, through the, through the cessor, right? Yeah. Yeah.
The city component is overseen by housing with the in, in,
in coordination, with the Assessor's Office.
Yeah, yeah, because in the in Edgewater we're trying to
Spur economic development through.
Creation of more housing, especially around the red line.
That's being reconstructed for the first time in a 100
years, you know. And we we have a a challenge because that
because of uh, land use Downing specially from Foster to
Devon and and we want to attract development.
um, and then in a way that
that that people understand, especially to make it more
predictable in terms of the the um the way taxes are
assessed.
Um, so is that something that you can help?
uh, I can certainly provide you with, like, the, the write
up, the overview that we have, and then we can, we can
discuss from there like, the best way to to
To to facilitate whatever you want I suppose, but it's
definitely going to be in coordination with do. Thanks,
Jim. Thanks Jim. Thank you and uh for the members that are
here and online, my staff did send over all this material
in the share Drive. Um, so if you did receive it, uh,
follow up with our team and we'll get it to you but it
should be in a share Drive.
Or do you know the questions for members of the committee?
Right seeing none. Thank you. Tim for the presentation.
This is something that all of our, a lot of our colleagues
have been asking for and I appreciate you making it as
simple as possible. Um and looking forward to continue to
work with you and your department around these incentives.
Always. Thank you. All right, since there's no further
business, um, may I have a motion to adjourn by the same
role call that was applied to the term Quorum Alise. So
moves hearing no objections. So ordered the meeting on the
committee and economic capital technology development is a