2005-004- I I W
Ordinance No. 2005 - 4
An Ordinance Approving an Economic Incentive Agreement
By and Between the Village of Buffalo Grove and
the Arlington Automotive Group, Inc.
WHEREAS, the Village of Buffalo Grove is a Home Rule Unit by virtue of the Illinois
Constitution of 1970; and,
WHEREAS, Arlington Automotive Group, Inc., operates as Arlington Toyota, Arlington Scion
and Arlington Collision Center at 935 West Dundee Road in Buffalo Grove, Illinois; and
WHEREAS, Arlington Automotive Group, Inc. desires to expand its business in the Village of
Buffalo Grove, including but not limited to, expanding its vehicle inventory, sales, service and repair
operations; and
WHEREAS, in an effort to maintain their business operation in Buffalo Grove, and to assist
with their corporate imposed expansion requirements, the Village is willing to grant certain incentives
to Arlington Automotive Group, Inc.
NOW THEREFORE BE IT ORDAINED BY THE PRESIDENTAND BOARD OF TRUSTEES
OF THE VILLAGE OF BUFFALO GROVE, COOK AND LAKE COUNTIES, ILLINOIS:
Section 1. The foregoing Whereas clauses are hereby incorporated herein.
Section 2. The Village President and Village Clerk are hereby authorized to execute the
Agreement between the Village of Buffalo Grove and Arlington Automotive
Group, Inc, a copy of which is attached hereto as Exhibit "A ".
Section 3. This Ordinance shall be in full force and effect from and after its passage,
approval and publication. This Ordinance may be published in pamphlet
form. This Ordinance shall not be codified.
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AYES: 5 - Braiman. Glover, Berman. Kahn, Trilling
NAYES: 0 - None
ABSENT: 0 - None
ABSTAIN: 0 - None
PASSED: January 24, 2005 , 2005.
APPROVED: January 24 , 2005.
PUBLISHED: January 25 , 2005.
APPROVED:
Village President
ATTEST:
Wilage Clerk
1/19/05
i . . •
EXHIBIT "A"
ECONOMIC INCENTIVE AGREEMENT
BY AND BETWEEN
THE VILLAGE OF BUFFALO GROVE
AND
THE ARLINGTON AUTOMOTIVE GROUP, INC.
This Agreement is made and entered into as of the 24th day of January, 2005, by and
between the Village of Buffalo Grove , an Illinois home rule municipal corporation (hereinafter
defined as the "Village ") and The Arlington Automotive Group, Inc., an Illinois corporation
(hereinafter defined as "Toyota ").
In consideration of the recitals and mutual covenants and agreements set forth herein,
the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
SECTION 1. RECITALS.
A. Toyota conducts its Business at the Premises commonly known as 935 West
Dundee Road, Buffalo Grove, Illinois.
B. Toyota has adopted the assumed names of "Arlington Toyota ", "Arlington Scion"
and "Arlington Collision Center".
C. Toyota desires to expand its Business in the Village of Buffalo Grove, including
but not limited to, expanding its vehicle inventory, sales, service and repair operations. The
single order acceptance point for all of Toyota's Business would continue to be conducted from
the Premises.
D. In order to encourage Toyota to maintain its business operation in the Village, to
assist with their expansion plans in the Village, and to undertake and ensure the success of the
Development, the Village agrees, pursuant to the terms of this Agreement, to share sales tax
received by the Village using a formula which corresponds to new sales tax revenue generated
by the Development over a finite period of time.
E. As of the date of this Agreement, the total sales tax rate applicable on the sale of
certain tangible personal property, including but not by way of limitation, items that must be titled
or registered by an agency of the State of Illinois (e.g. automobiles) within the Cook County
portion of the Village is seven and three - quarter percent (7.75 %), the Village portion of which is
one percent (1 %) (which is comprised of the one percent (1 %) Illinois retailers' occupation tax).
F. As of the date of this Agreement, the total sales tax rate applicable on the sale of
taxable tangible personal property (e.g. general merchandise but not including automobiles) is
eight and three - quarter percent (8.75 %), the Village portion of which is two percent (2 %) (which
is comprised of the one percent (1 %) Illinois retailers' occupation tax, and the one percent (1 %)
Village's Home -Rule Sales Tax).
G. The Village has the power and authority to enter into this Agreement pursuant to,
but without limitation, the home rule powers of the Village under Section 6, Article VII of the
1970 Constitution of the State of Illinois.
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SECTION 2. RULES OF CONSTRUCTION AND DEFINITIONS.
A. The language in this Agreement shall be interpreted in accordance with
the following rules of construction: (a) The word "may" is permissive and the word "shall" is
mandatory; and (b) except where the context reveals the contrary: The singular includes the
plural and the plural includes the singular, and the masculine gender includes the feminine and
neutral.
B. Whenever used in the upper case in this Agreement, the following words
shall have the following meanings:
Agreement. This Economic Incentive Agreement.
2. Audit. Undertaken at the sole cost and expense of the Village, a review
of the books and records of the Business by the Financial Consultant for the purpose of
making a determination of the amount of Municipal Sales Tax the Village should have
received under the terms of this Agreement and for the purpose of verifying Toyota's
compliance with the terms of this Agreement.
3. Base Year. The twelve months immediately preceding the
Commencement Date.
4. Business. All of the sales operations of Toyota. that occur on the
Premises, including but not limited to, the sales, service and repair of automobiles and
all associated operations.
5. Commencement Date. The first day of the first calendar month following
the date upon which Toyota is issued a Village Certificate of Occupancy for the
Development, but no later than December 31, 2006.
6. Development. The expansion and renovation of the existing facilities
and infrastructure on the Premises in order to increase vehicle inventory, and expand
service and repair operations. Project improvements include, but are not limited to, re-
imaging the existing dealership building to new Image USA standards, expansion of the
service building to add additional service bays, relocate or expand the body shop
building, expansion of parking, and construction of underground water storage vault for
on -site storm water retention requirements.
7. Financial Consultant. The person, firm or corporation and agents
thereof authorized by the Village to conduct an Audit, at the sole cost and expense of
the Village, of the Business regarding all transactions occurring during any given Sales
Tax Year following the date of this Agreement.
8. Gross Receipts. The term "Gross Receipts" shall have the same
meaning as that which is ascribed to it in the Retailers' Occupation Tax Act.
9. Home Rule Sales Tax. The one percent (1 %) sales tax imposed in the
Village pursuant to Village's Home Rule Sales Tax Ordinance No. 2004 -16 enacted in
accordance with the Home Rule Municipal Retailers' Occupation Tax Act (65 ILCS 5/8-
11 -1) and the Home Rule Municipal Service Occupation Tax Act (65 ILCS 5/8- 11 -5).
Pursuant to the Home Rule Municipal Retailers' Occupation Tax Act, said tax shall not
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be imposed upon an item of tangible personal property titled or registered with an
agency of the State of Illinois.
10. Incremental Municipal Sales Tax. The additional Municipal Sales Tax
generated by Toyota from the Development in excess of the Municipal Sales Tax
generated from the existing operation. For purposes of this Agreement, the Municipal
Sales Tax generated from the existing operation shall be determined based on the
Municipal Sales Tax paid by Toyota for the Base Year, but not less than $430,000.00.
11. Municipal Sales Tax. That portion or component of the Sales Tax
generated by the Development that the Village actually receives from the State of Illinois
pursuant to the Village's Home Rule Sales Tax, the Retailers' Occupation Tax Act, the
Service Occupation Tax Act, the Service Use Tax Act, and the Use Tax Act.
12. Municipal Sales Tax Payment. The payment to Toyota of a portion of
the Municipal Sales Tax that the Village is required to make pursuant to Section 3 of this
Agreement.
13. Payment Date. Within ninety (90) days after the end of each Sales Tax
Year.
14. Premises. The real estate and structures located at the commonly
known address of 935 West Dundee Road, Cook County, Buffalo Grove, Illinois.
15. Retailer's Occupation Tax Act. The Illinois Retailers' Occupation Tax
Act, 35 ILCS 120/1 et seq., as the same has been, and may, from time to time hereafter
be, amended.
16. Sales Tax(es). Any and all taxes imposed and collected by the State of
Illinois pursuant to the Home Rule Sales Tax, the Retailer's Occupation Tax Act, the
Service Occupation Tax Act, the Service Use Tax Act, or the Use Tax Act.
17. Sales Tax Year. The period of time commencing on the Commencement
Date and ending on the date that is one year after the Commencement Date, and each
of the seven (7) succeeding. one year periods thereafter.
18. Service Occupation Tax Act. The Illinois Service Occupation Tax Act,
35 ILCS 115/1 et seq., as the same has been, and may, from time to time hereafter be,
amended.
19. Service Use Tax Act. The Illinois Service Use Tax Act, 35 ILCS 110/1 et
seq., as the same has been, and may, from time to time hereafter be, amended.
20. Use Tax Act. The Illinois Use Tax Act, 35 ILCS 105/1 et seq., as the
same has been, and may, from time to time hereafter be amended.
21. Viltasae or Villane of Buffalo Grove. The Village of Buffalo Grove, an
Illinois municipal corporation and home rule unit as described in the Illinois Constitution.
SECTION 3. MUNICIPAL SALES TAX PAYMENT.
A. The Village shall pay Toyota the Municipal Sales Tax Payment on or before the
Payment Date an amount equal to the following.formulas:
1. For the first Sales Tax Year, eighty
percent
(80 %)
of that
year's
Incremental Municipal Sales Tax.
2. For the second Sales Tax Year,
seventy percent (70 %)
of that
year's
Incremental Municipal Sales Tax.
3. For the third Sales Tax Year,
sixty
percent
(60 %)
of that
year's
Incremental Municipal Sales Tax.
4. For the fourth Sales Tax Year,
fifty
percent
(50 %)
of that
year's
Incremental Municipal Sales Tax.
5. For the fifth Sales Tax Year,
forty
percent
(40 %)
of that
year's
Incremental Municipal Sales Tax.
6. For the sixth Sales Tax Year,
thirty
percent
(30 %)
of that
year's
Incremental Municipal Sales Tax.
7. For the seventh Sales Tax Year,
twenty percent (20 %)
of that
year's
Incremental Municipal Sales Tax.
8. For the eighth Sales Tax Year, ten
percent
(10 %)
of that
year's
Incremental Municipal Sales Tax.
B. Prior to any Municipal Sales Tax Payment, Toyota shall provide the Village with
copies of its Sales Tax returns for the Base Year for the existing operation, which returns shall
be used for establishing the existing operation sales.
C. The amount due pursuant to this Agreement shall not be a general obligation of
the Village. The Village shall not have an obligation to pay any amounts to Toyota except an
amount equal to the Village's local sales tax share actually received from Illinois Department of
Revenue on account of the Development and not exceeding the sales tax rates as set forth in
this Agreement.
D. The Village shall continue the Municipal Sales Tax Payments for the eight (8)
year term of this Agreement.
E. In the event that any sales tax returns that have been submitted to the Village are
amended, Toyota shall promptly forward a photocopy of such amended sales tax returns to the
Village, clearly identifying them as an amendment of a sales tax return previously submitted to
the Village.
F. Should Toyota cease its Business on the Premises within two years of the
Commencement Date of this Agreement, then Toyota shall reimburse to the Village 100% of the
Municipal Sales Tax Payments received pursuant to this Agreement.
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SECTION 4. LITIGATION AND DEFENSE OF AGREEMENT.
A. Litigation. If, during the term of this Agreement, any lawsuits or proceedings are
filed or initiated against either party before any court, commission, board, bureau, agency, unit
of government or sub -unit thereof, arbitrator, or other instrumentality, that may materially affect
or inhibit the ability of either party to perform its obligations under, or otherwise to comply with,
this Agreement ( "Litigation "), the party against which the Litigation is filed or initiated shall
promptly deliver a copy of the complaint or charge related thereto to the other party and shall
thereafter keep the other party fully informed concerning all aspects of the Litigation.
B. Defense. The Village and Toyota each agree to use their respective best efforts
to defend the validity of this Agreement, and all ordinances and resolutions adopted and
agreements executed pursuant to this Agreement, including every portion thereof and every
approval given, and every action taken, pursuant thereto.
SEC, TION 5. REMEDIES.
A. Remedies. In the event of a breach or an alleged breach of this Agreement by
either party, either party may, by suit, action, mandamus, or any other proceeding, in law or in
equity, including specific performance, enforce or compel the performance of this Agreement.
Any claim or suit related to this Agreement shall be filed in the Circuit Court of Cook County.
The prevailing party shall be entitled to recovery of its attorneys fees and costs.
B. Notice and Cure. Neither party may exercise the right to bring any suit, action,
mandamus or any other proceeding pursuant to Subsection A of this Section without first giving
written notice to the other party of the breach or alleged breach and allowing 15 days to cure the
breach or alleged breach; provided, however, that if the party accused of the breach or alleged
breach cannot cure the condition within 15 days after the notice, notwithstanding the party's
diligent and continuous effort, promptly commenced and diligently continued upon receipt of the
notice, then the period to cure the violation or failure shall be extended for the time necessary to
cure the violation with diligence and continuity, but in no event longer than 180 days unless
extended in writing by the non - breaching party.
SECTION 6. TERM.
This Agreement shall be in full force and effect from and after the date of its execution
until the date that is the earlier to occur of (a) the date that is eight (8) years after the
Commencement Date or (b) the date on which the Village has made all payments required
pursuant to this Agreement.
SECTION 7. RELEASE OF INFORMATION.
Prior to any payments by the Village of any sums as provided for in this Agreement,
Toyota shall cause to be delivered to the Village, on a quarterly basis, the Illinois Retailers'
Occupation Tax, Use Tax and Service Occupation Tax returns and /or other documentation
submitted by Toyota to the Illinois Department of Revenue, which detail the amount of Sales
Tax that Toyota paid to Illinois Department of Revenue with respect to Toyota's operations. If
necessary, Toyota shall provide the Village with a limited power of attorney, addressed to and in
a form satisfactory to the Illinois Department of Revenue, authorizing the Illinois Department of
Revenue to release to the Village all gross revenue and Sales Tax information submitted by
Toyota to the Illinois Department of Revenue. Additionally, in the event that the Illinois
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Department of Revenue does not make available to the Village said documentation, Toyota
shall provide alternative documentation that details the amount of Sales Taxes that Toyota paid
to the Illinois Department of Revenue.
SECTION 8. GENERAL PROVISIONS.
A. Complete Agreement; Supersedence. This Agreement constitutes the
complete agreement of the parties regarding the payment of Municipal Sales Tax to Toyota and
shall supersede and nullify all prior drafts and agreements concerning the payment of Municipal
Sales Tax to Toyota.
B. Amendments. No amendment to, or modification of, this Agreement shall be
effective unless and until it is in writing and is approved by the authorized representative of
Toyota and by the Village of Buffalo Grove corporate authorities by Ordinance duly adopted,
and executed and delivered by the authorized representatives of each party.
C. Notices. Any notice or other communication required or permitted to be given
under this Agreement shall be in writing, and shall be deemed delivered to and received by the
addressee thereof when delivered in person at the address set forth below, or three business
days after deposit thereof in any main or branch United States Post Office, certified or
registered mail, return receipt requested, postage prepaid, properly addressed to the parties,
respectively, as follows:
For notices and communications to the Village: Village of Buffalo Grove
50 Raupp Blvd.
Buffalo Grove, Illinois 60089
Attention: Director of Finance
with a copy to:
For notices and communications to Toyota:
William G. Raysa, Esq.
Raysa & Zimmerman, Ltd.
22 South Washington
Park Ridge, Illinois 60068
Mr. Gary Vicari
President
Arlington Automotive Group
935 West Dundee Road
Buffalo Grove, Illinois 60089
with a copy to: Matthew L. Moodhe, Esq.
Kovitz Shifrin Nesbit
750 Lake Cook Road, Suite 350
Buffalo Grove, Illinois 60089
By notice complying with the foregoing requirements of this paragraph, each party shall have
the right to change the address or addressee or both for all future notices and communications
to such party, but no notice of change of address shall be effective until actually received.
D. Indemnity. Toyota shall and hereby agrees to defend, hold harmless and indemnify the
Village, its President, Trustees, officers, shareholders, employees, agents and attorneys from
• . . •
and against any and all claims, demands, suits, damages, liabilities, losses, expenses, and
judgments which may specifically arise out of the subject matter of this Agreement regarding
sales tax refunds. The obligation of Toyota in this regard shall include but shall not be limited to
all costs and expenses, including reasonable attorneys' fees, incurred by the Village in
responding to, defending against, or settling any such claims, demands, suits, damages,
liabilities, losses, expenses or judgments specifically and only arising from the subject matter
referred to in this Agreement concerning sales tax refunds. Toyota covenants that it will
reimburse the Village, or pay over to the Village, all sums of money the Village pays, or
becomes liable to pay, by reason of any of the foregoing, and will make payment to the Village
as soon as the Village becomes liable therefore. In any suit or proceeding brought hereunder,
the Village shall have the right to appoint counsel of its own choosing to represent it.
E. Governing Law. This Agreement and the rights of the parties hereunder shall
be governed by, and construed, interpreted, and enforced in accordance with, the internal laws,
and not the conflict of law rules of the State of Illinois.
F. Interpretation. This Agreement has been negotiated by all parties and shall not
be interpreted or construed against the party drafting the Agreement.
G. Change in Laws. Unless otherwise explicitly provided in this Agreement, any
reference to laws, ordinances, rules, or regulations of any kind shall include such laws,
ordinances, rules, or regulations of any kind as they may be amended or modified from time to
time hereafter.
H. Headings. The headings of the sections, paragraphs, and other parts of this
Agreement are for convenience and reference only and in no way define, extend, limit, or
describe the meaning, scope, or intent of this Agreement, or the meaning, scope, or intent of
any provision hereof.
1. Time of Essence. Time is of the essence in the performance of all terms and
provisions of this Agreement.
J. Severability. It is the express intent of the parties hereto that should any
provision, covenant, agreement, or portion of this Agreement or its application to any person,
entity, or property be held void, invalid, or unenforceable by a court of competent jurisdiction,
such action shall not effect the remainder of this Agreement, which shall continue in full force
and effect.
K. No Third Party Beneficiaries. Nothing in this Agreement shall create, or be
construed to create, any third party beneficiary rights in any person or entity not a signatory to
this Agreement.
L. Counterparts. This Agreement may be executed in any number of multiple
identical counterparts. and all of said counterparts shall, individually and taken together
constitute the Agreement.
M. Assignment. Toyota may not assign this Agreement or the amounts, in whole or
part, to be paid hereunder without the Village's prior written consent. The Village acknowledges
that this Agreement is an obligation which runts to Toyota and is not a covenant running with the
land. Notwithstanding the foregoing, in the event that Toyota sells all of its assets, or the
principals of Toyota sells all or substantially all of their stock, and following the sale, the
• . . •
operations of the Business remain substantially the same and in conformance with all
obligations of the Agreement, this Agreement will remain in full force and affect and Village will
grant its approval of the Assignment of the Agreement. The assignee is bound by all of the
terms and conditions of the Agreement.
O. Audit. Upon prior written notice to Toyota, and at a place and time that is
mutually beneficial to both parties, the Village shall have the right conduct an Audit of Toyota to
inspect and review those books and records which are directly related to establishing Gross
Receipts for any Sales Tax Year, Base Year, or any portion thereof.
P. No Village Obligation. The parties acknowledge and agree that none of the
terms, conditions or provisions of this Agreement shall be construed, deemed, or interpreted as
(i) a restriction or prohibition on the Village from eliminating or amending it Home Rule Sales
Tax, or (ii) a requirement to impose a sales or other tax for the purpose of providing a source of
funds for the Municipal Sales Tax Payment.
Q. Loss of Authority. In the event that the Village's authority to enter into this
Agreement or to pay the Municipal Sales Tax Payment to Toyota pursuant to this Agreement
are repealed, become unexercisable, null and void or otherwise become invalid then the
Village's obligations hereunder shall cease and no further obligations shall be required of the
Village.
R. Certifications. Each party hereto certifies hereby that it is not barred from
entering into this Agreement as a result of violations of either Sections 33E -3 or 33E -4 of the
Illinois Criminal Code (724 ILCS 5/33 —E -3, 5/33 -E-4), that it has a written policy against sexual
harassment in place in full compliance with 775 ILCS 5/2- 105(A)(4), and it is in compliance with
the Illinois Drug Free Workplace Act (30 ILCS 58012).
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their duly authorized representatives as of the date first above written.
VILLAGE OF BUFFALO GROVE
Village President
ATTEST:
Vill Clerk
THE ARLINGTON AUTOMOTIVE GROUP, INC.
By:
Its:
ATTEST:
Its: Vick Anre- LI
! . . 0
ACKNOWLEDGEMENT
STATE OF ILLINOIS )
SS
COUNTY OF COOK )
This instrument was acknowledged before me one Z 2005 by
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the President o�THE ARLINGTON AUTOMOTIVE GROUP, INC. , an Illinois
corporation, and by �c 77 "Alu , the irc - .!'r1,0evkjf said company.
011fciel seal
Lawrence Juskwwicz
Notr i°ubkc sake or iiknoes Si natu of Nota
EMY 4 Commission Expres 07 /15ioe g rY
SEAL:
My Commission expires: 07
STATE OF ILLINOIS )
) ss.
COUNTY OF COOK )
CERTIFICATE
I, Janet A Sirabian, certify that I am the duly elected
and acting Village Clerk of the Village of Buffalo
Grove, Cook and Lake Counties, Illinois.
I further certify that on January 24, 2005 the
Corporate Authorities of the Village passed and
approved Ordinance No. 2005 -4 entitled: AN
ORDINANCE APPROVING AN ECONOMIC INCENTIVE
AGREEMENT BY AND BETWEEN THE VILLAGE OF
BUFFALO GROVE AND THE ARLINGTON AUTOMOTIVE
GROUP, INC provided by its terms that it should be
published in pamphlet form.
The pamphlet form of, Ordinance No. 2005 -4;:
including the Ordinance and a sheet thereof, was
prepared, and a copy of such Ordinance was posted,.
in and at the Village Hall, commencing January 25,
2005, and continuing for at least ten days thereafter.
Copies of such Ordinance were also available for
public inspection upon request in the Office of
Village Clerk.
Dated at Buffalo Grove, Illinois, this 25th day of
January, 2005.
yY% h� /`LCl�yt�
Vill Clerk
By
Ordinance No. 2005 - 4
An Ordinance Approving an Economic Incentive Agreement
By and Between the Village of Buffalo Grove and
the Arlington Automotive Group, Inc.
WHEREAS, the Village of Buffalo Grove is a Home Rule Unit by virtue of the Illinois
Constitution of 1970; and,
WHEREAS, Arlington Automotive Group, Inc., operates as Arlington Toyota, Arlington Scion
and Arlington Collision Center at 935 West Dundee Road in Buffalo Grove, Illinois; and
WHEREAS, Arlington Automotive Group, Inc. desires to expand its business in the Village of
Buffalo Grove, including but not limited to, expanding its vehicle inventory, sales, service and repair
operations; and
WHEREAS, in an effort to maintain their business operation in Buffalo Grove, and to assist
with their corporate imposed expansion requirements, the Village is willing to grant certain incentives
to Arlington Automotive Group, Inc.
NOW THEREFORE BE IT ORDAINED BY THE PRESIDENTAND BOARD OF TRUSTEES
OF THE VILLAGE OF BUFFALO GROVE, COOK AND LAKE COUNTIES, ILLINOIS:
Section 1. The foregoing Whereas clauses are hereby incorporated herein.
Section 2. The Village President and Village Clerk are hereby authorized to execute the
Agreement between the Village of Buffalo Grove and Arlington Automotive
Group, Inc, a copy of which is attached hereto as Exhibit "A ".
Section 3. This Ordinance shall be in full force and effect from and after its passage,
approval and publication. This Ordinance may be published in pamphlet
form. This Ordinance shall not be codified.
AYES: 5 - Braiman. Glover. Berman. Kahn, Trilling
NAYES: 0 - None
ABSENT: 0 - None
ABSTAIN: 0 - None
PASSED: January 24, 2005 , 2005.
APPROVED: January 24 , 2005.
PUBLISHED: January 25 , 2005.
APPROVED:
Village President
ATTEST:
(-Village Clerk