2001-016 ORDINANCE 2001- 16
An Ordinance Approving a Contingent Infrastructure Agreement
for the Plaza at Buffalo Grove Shopping Center
WHEREAS, the Village of Buffalo Grove is a Home Rule Unit pursuant to the Illinois
Constitution of 1970; and
WHEREAS, Dominick's Finer Foods, Inc. ("Dominick's") currently operates a food store at
the southeast corner of Dundee and Buffalo Grove Roads within the Village and desires to relocate
the existing store and construct a new supermarket of approximately 66,000 square feet on the
property located at the northwest corner of Dundee and Buffalo Grove Roads known as the Plaza;
and
WHEREAS, Dominick's will serve as "facilitator' of the improvements necessary to
rehabilitate the Plaza on behalf of the owner, including the potential construction of an underground
detention storage vault as may be required on site as part of the redevelopment by the Metropolitan
Water Reclamation District and the installation of a Traffic Signal at the Buffalo Grove Road
entrance to the Project;
WHEREAS, the Owner of the property recognizes the needed improvement on the property
and acknowledges that this redevelopment project is not feasible without financial assistance;
WHEREAS, the construction and operation of the project will create job opportunities within
the Village, further the economic development of adjacent area, strengthen the commercial base
and enhance the tax base of the Village and reduce the risk of flooding of adjacent residential
properties.
NOW, THEREFORE, BE IT ORDAINED BY THE PRESIDENT AND BOARD OF
TRUSTEES OF THE VILLAGE OF BUFFALO GROVE, COOK AND LAKE COUNTIES, ILLINOIS,
as follows:
Section 1. The preceding WHEREAS clauses are hereby adopted by the Corporate
Authorities.
Section 2. The Village President and Village Clerk are hereby authorized to execute the
Contingent Infrastructure Agreement between the Village of Buffalo Grove, Dominick's Finer Foods,
Inc., (the "facilitator") and Buffalo Grove Plaza, LLC, (the "owner") a copy of which is attached
hereto as Exhibit"A".
Section 3. This Ordinance shall be in effect from and after its passage and approval.
This Ordinance shall not be codified.
AYES: 6 - Marienthal. Braiman, Hendricks Glover Berman Johnson
NAYES: 0 - None
ABSENT: 0 - None
PASSED: April 2, 2001 -, , 2001.
APPROVED: Aril 2, 2001 , 2001.
APPROVED:
Village P g resident
ATTEST:
I . S�
Villag erk
29-Mar-01
2
CONTINGENT INFRASTRUCTURE AGREEMENT
This CONTINGENT INFRASTRUCTURE AGREEMENT(this"Agreement") is entered into
this ��k day of �f�e, ��,ry_,200-4 by and between the VILLAGE OF BUFFALO GROVE,an Illinois
Municipal Corporation (the"Village"),DON HNICK'S FINER FOODS,INC., a Delaware corporation
("Dominick's")and BUFFALO GROVE PLAZA,LLC(the"Owner").
WITNESSETH:
WHEREAS, the Village is an Illinois Home Rule Municipal Corporation existing under and by
virtue of the Constitution and laws of the State of Illinois, including but not limited to the Illinois Municipal
Code;and
WHEREAS,the Village,as a Home Rule unit of government, may exercise any power and perform
any function pertaining to its government and affairs pursuant to Section 6 of Article VII of the 1970
Constitution of the State of Illinois, and pursuant to Section 10 of Article VII, is authorized to contract or
otherwise associate with individuals in any manner not prohibited by law or ordinance; and
WHEREAS, Dominick's currently operates a food store at the southeast corner of Dundee and
Buffalo Grove Roads within the Village(the"Existing Store"); and
WHEREAS, Dominick's desires to relocate the Existing Store and construct a new supermarket of
approximately 66,000 square feet(the"Project")on the property located at the northwest corner of Dundee
and Buffalo Grove Roads within the Village(the"Subject Property"); and
WHEREAS,Owner is the sole beneficiary with the sole power of direction of American National
Bank and Trust Company of Chicago as Trustee under Trust No. 116529-06, the record title holder of the
Subject Property; and
WHEREAS, in addition to the construction of the Project,other improvements will be made to the
Subject Property; and
1
WHEREAS,the Project may require the creation of on-site stormwater management improvements,
including but not limited to an underground detention storage vault(the"Drainage Improvements")which
may be required by the Metropolitan Water Reclamation District; and
WHEREAS,said Drainage Improvements will assist in alleviating drainage deficiencies that exist
in the area and that installation of the Drainage Improvements are in the public interest, health and safety;
and
WHEREAS, the Village desires construction at the earliest possible date of a traffic signal at the
Project entrance and Buffalo Grove Road(the"Traffic Signal")to improve public access and safety; and
WHEREAS,the Village may under its home rule powers agree to share revenue of the Village using
a formula which corresponds to new revenue generated by the development or redevelopment over a finite
period of time; and
WHEREAS, the hereinafter described funding shall be dedicated to the partial
reimbursement of the construction of the Drainage Improvements on the Subject Property which may
be triggered if the Drainage Improvements are required by the Metropolitan Water Reclamation
District; and
WHEREAS,R.EAS, the Sales Tax(as hereinafter defined) formula contemplated herein does not affect
other stores which might be located on the Subject Property and only includes those sales generated from
the Project; and
WHEREAS, the Subject Property consists of store space that is currently vacant; and
WHEREAS, the construction and operation of the Project will create job opportunities within the
Village; and
WHEREAS, the Project will further the economic development of adjacent areas; and
2
WHEREAS, the Project will strengthen the commercial base, substantially enhance the tax base of
the Village, and provide new services and convenience to the Village; and
WHEREAS, it is in the best interests of the Village to enter into this Agreement.
NOW,THEREFORE,FOR GOOD AND VALUABLE CONSIDERATION THE RECEIPT AND
SUFFICIENCY OF WHICH ARE HEREBY ACKNOWLEDGED,THE PARTIES AGREE AS FOLLOWS:
SECTION 1. Incorporation. The Preambles to this Agreement are hereby declared to be the
finding of the parties and that said Preambles and all Exhibits referred to in this Agreement are incorporated
herein as if fully set forth in this Section 1. Attached hereto as Exhibit A is a Financial Proposal which is
a representation of the formula set forth in Section 3A below with estimated amounts.
SECTION 2. Conditions Precedent to the Undertaki.n On the Part of the Villa e.
AI I undertakings on the part of the Village pursuant to this Agreement are subject to the satisfaction
of the following conditions by Dominick's on or before the date of the initial payment by the Village
provided for in Paragraph 3 below, or as otherwise specifically hereinafter stated:
(a) That the Metropolitan Water Reclamation District (MWRD) shall have required as a
condition for permit the construction of an on-site underground water detention storage
vault. In the event the MWRD does not require such an on-site underground detention
storage vault,the Village shall not have any obligation to contribute any monies toward the
contemplated Drainage Improvements or Traffic Signal improvements.
(b) Demonstration by Dominick's of a right to possess that portion of the Subject Property
known as the Project during the term of this Agreement.
(c) Dominick's shall have obtained occupancy permits and business licenses from the Village
which shall not be unreasonably withheld.
AWEM VRCl449683.1 3
(d) Prior to all payments by the Village of any sums as provided for in this Agreement,
Dominick's shall cause to be delivered to the Village, on a quarterly basis, the Illinois
Retailers' Occupation Tax,Use Tax and Service Occupation Tax(hereinafter collectively
referred to as"Sales Tax")returns and/or other documentation submitted by Dominick's
to the Illinois Department of Revenue("IDOR"),which detail the amount of Sales Tax that
Dominick's paid to IDOR with respect to Dominick's operations at the Project. If
necessary,Dominick's shall provide the Village with a limited power of attorney,addressed
to and in a form satisfactory to IDOR, authorizing IDOR to release to the Village all gross
revenue and Sales Tax information submitted by Dominick's to IDOR. Additionally, in the
event that IDOR does not make available to the Village said documentation, Dominick's
shall provide alternative documentation that details the amount of Sales Taxes that
Dominick's paid to IDOR with respect to the Project. Notwithstanding anything to the
contrary contained in this Agreement, Sales Tax shall not include any of the Village's home
rule sales taxes.
SECTION 3. Undertakings on the Part of the lillagre Upon Satisfaction of all the Conditions
Herein Stated.
A. To insure the proper development of the Subject Property,completion of the Project,
installation of the Traffic Signal and Drainage Improvements(collectively"Infrastructure
Improvements")and to foster the continued economic growth of the area,the Village shall,
commencing on the 1st day of the first calendar month following the opening for business
of the Project to the public at the Subject Property (the "Starting Date"), pay as partial
reimbursement for construction of the Drainage Improvements and Traffic Signal to
Dominick's,annually in arrears,an amount equal to the following formulas:
AWEMERC/449683.1 4
(i) In years one (1) and two (2) inclusive of this Agreement, seventy-five
percent (75%) of the Village's local share (currently one percent (1%)) of the
Incremental Sales Tax(hereinafter defined)generated exclusively from Dominick's
sales at the Project.
In years three (3) through five (5) inclusive of this Agreement, seventy
(70%)percent of the Village's local share of the Incremental Sales Tax generated
exclusively from Dominick's sales at the Project.
In years six (6)through ten (10) inclusive of this Agreement, fifty (50%)
percent of the Village's local share of the Incremental Sales Tax generated
exclusively from Dominick's sales at the Project.
B. The Village shall not be obligated to make any payments under this Agreement
unless the MWRD requires that its stormwater detention ordinance be met through the
construction of on-site underground vault stormwater detention.
C. "Incremental Sales Tax" as used herein shall mean the additional Sales Tax
generated only by Dominick's from the Project in excess of the Sales Tax generated from
the Existing Store. For purposes of this Agreement the Sales Tax generated from the
Existing Store shall be determined based on the Sales Tax paid by Dominick's for the
Existing Store during the twelve months immediately preceding the Starting Date (the
"Base Year"), but not less than$136,240.00 as detailed on Exhibit A. Dominick's shall
provide the Village with copies of its Sales Tax Returns for the Base Year for the Existing
Store,which returns shall be used for establishing the Existing Store sales.
AWEINBERG/449693.1 5
D. The amount due pursuant to this Agreement shall not be a general obligation of the
Village and the Village shall not have an obligation to pay any amounts except an amount
equal to the Village's local share actually received from IDOR.
E. The Village shall, at the end of each twelve month period after the Base Year(the
"Sales Tax Year"), pay the sums measured by Sales Taxes generated as provided in
subparagraph 3(A) above, which payments shall continue without interruption until the
earlier of(i)the ten(10)year term of this Agreement,or(ii) a maximum of$350,000 has
been paid. The Village shall make said annual payments to Dominick's within ninety(90)
days of the end of the Sales Tax Year.
F. In the event that any sales tax returns that have been submitted to the Village are
amended, Dominick's agrees to 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.
G. Payments pursuant to this Agreement shall be made to the entity that paid for the
Drainage Improvements and Traffic Signal(the"Facilitator")as determined by the Village
in its sole discretion. Prior to any payment by the Village,the Facilitator shall deliver to the
Village such documentation,as the Village shall require to signify(i)proof of payment for
the Drainage Improvements and Traffic Signal and(ii)that the Drainage Improvements and
Traffic Signal were fully completed.
SECTION 4. Re resentations and Warranties of Dominick's.
A. Dominick's hereby represents and warrants that at all times it shall comply with all
applicable zoning ordinances and regulations,Planned Unit Developments,and all building
AW EINBERG/449683.1 6
and fire code regulations, and all other applicable Village ordinances, resolutions, and
regulations.
B. Dominick's represents and warrants that it shall comply with all terms, provisions
and conditions of this Agreement.
C. No annual payments shall be made pursuant to this Agreement until the completion
of the parking lot and lighting system improvements at the Subject Property has been
approved by the Village, which approval shall not be unreasonably withheld. Said
improvements are set forth in Village Ordinance No. 2001-13,entitled Second Amendment
to the Plaza at Buffalo Grove Planned Unit Development.
D. The parties agree that an appropriate construction phasing plan, reasonably
acceptable to the Village, to provide for access to the existing commercial tenants of the
Subject Property shall be completed prior to issuance of building permits and followed
throughout the construction of the Project.
E. Dominick's shall actively market the Existing Store and seek potential tenants in
keeping with zoning requirements as well as the context of the neighborhood. Subject to
Dominick's rights under its existing lease,Dominick's will further encourage any specific
redevelopment proposals of the Cambridge Commons Shopping Center.
SECTION 5. Traffic Signal and Construction Recapture Provisions
A. Dominick's shall have the responsibility to construct and pay for the Traffic
Signal at Buffalo Grove Road and the Project drive immediately once warrants are met. This
will include design and completion of necessary warrant studies, acceptable to the Cook
County Highway Department. The warrant study shall be completed with the final design
AWEMERG/449687.1 7
for the Project and if warrants are met, shall include the design and construction of the
Traffic Signal. If warrants are not met at that time,Dominick's shall at the Village's request
complete a second warrant study within six (6) months of the opening of the Dominick's
store and then if warranted shall construct the Traffic Signal. If the Traffic Signal is still not
warranted to the satisfaction of the Cook County Highway Department,Dominick's and the
Owner shall pay to the Village and/or post a letter of credit in a form acceptable to the
Village attorney, one-third each of the cost of the Traffic Signal if the Village determines
warrants may be met in the future. The money and/or letter of credit shall be paid to the
Village prior to the final acceptance of the Project.
B. Dominick's shall be eligible to recover two-thirds (2/3) of the cost of the
Traffic Signal through a recapture agreement to be enacted by the Village. The recovery shall
be from the following:
A. One-third(1/3) from the Owner, who hereby agrees to said payment.
B. One-third(1/3)from the owner of the Grove Court Shopping Center(easterly
commercial). Payments shall be collected when a building permit is issued from a project
which has been favorably considered for a change in special use.
C. The recapture period shall run for twelve (12) years from the date of the
installation and the cost recovery shall include a six (6%) percent interest for years two (2)
through twelve (12).
SECTION 6. Audit-Reconciliation.
Each payment by the Village pursuant to this Agreement shall be accompanied
AW EfNBERGf449687.1 8
by a statement executed by the Village Finance Director, setting forth the calculations of
such payment. The Village Finance Director shall further issue a statement to the Facilitator
setting forth all payments made to date pursuant to this Agreement. The Facilitator shall
have thirty (30)days following the receipt of said payment to contest any of the calculations
or information contained in said statements. In the event that the Facilitator shall initiate any
such contest, it must be made by written notice to the Village. If such contest shows and the
Village agrees that the amount paid pursuant to this Agreement was less or more than the
amount that should have been paid,either the Village shall pay to the Facilitator the balance
of such amount due within thirty (30) days of the completion of such contest, or if the
Facilitator has been paid more than the amount that should have been paid, then the
Facilitator shall reimburse the Village within thirty (30) days of the completion of such
contest.
SECTION 7. Confidentiality.
The parties acknowledge that the information contained in any sales tax return is confidential
and proprietary information to Dominick's and agree that to the fullest extent permitted by law, all
documents, including tax returns, and information provided to the Village, its agents and
representatives pursuant to or with regard to the provisions of this Agreement, shall not be released
or made available to any third person,corporation,organization or association without order of court
or the prior written approval of Dominick's. The Village shall offer Dominick's the opportunity to
defend any claim made by any third party against the Village for release of such documents or
information.
A W EMERG/449687.1 9
SECTION 8. Term.
This Agreement shall terminate ten (10) years after the Starting Date. The rights,
responsibilities and liabilities of the parties under this Agreement shall be extinguished upon the
termination of this Agreement except for any obligations that accrue prior to such termination.
SECTION 9. Defaults.
The occurrence of any one of the following shall constitute a default under this Agreement:
A. Failure to comply with any term, provision or condition of this Agreement
within the times herein specified unless due to causes beyond the reasonable control
of the party in default;
B. In the event a representation or warranty of Dominick's contained herein is
not true and correct and not cured within a period of thirty (30) days after written
notice to Dominick's by the Village.
C. If Dominick's shall: (i)be unable, or admits in writing its inability to pay its
debts as they mature; or (ii) makes a general assignment for the benefit of its
creditors concerning its debts as they mature;or(iii) is adjudicated a bankrupt; or(iv)
files a petition in bankruptcy or to effect a plan or other arrangement with creditors;
or (v) files an answer to a creditor's petition (admitting the material allegations
thereof) for an adjudication of bankruptcy or to effect a plan or other arrangement
with creditors; or (vi) applies to a court for the appointment of a receiver for
substantially all of its assets; or(vii) has a receiver or similar official appointed for
substantially all of its assets and such appointment shall not be discharged within
AWE[NBERGM49683..1 10
sixty (60) days after his appointment or Dominick's has not bonded against such
receivership or appointment; or (viii) a petition described in (iv) is filed against
Dominick's and remains undismissed for a period of sixty (60) consecutive days,
unless the same has been bonded, provided that nothing in this Agreement shall be
construed to prevent the assignment of Dominick's rights herein for collateral
purposes with the prior permission of the Village, which permission will not be
unreasonably withheld or denied.
Notwithstanding the occurrence of a default by Dominick's as hereinabove
set forth, so long as Dominick's continues to operate at the Project, the Village shall
be obligated to make the payments required under Section 3 above.
SECTION 10. Liabili .
No party hereto, nor the Facilitator may compel any exercise of taxing authority by the Village to
make payments provided for hereunder. The provisions of this Agreement do not constitute an
indebtedness of the Village or a loan of the credit of the Village within the meaning of any
constitutional or statutory provision.
SECTION 11. Repayment by Dominick's
A. If for any reason, Dominick's or any successor or assignee ceases to conduct its
supermarket foodstore on the Subject Property within ten years of the Start Date,then
Dominick's or such successor or assignee shall repay the Village the following
percentage of any and all sales tax payments paid by the Village pursuant to this
Agreement:
AWE[NBERG/449683.1 t t
Year Percentap-e
1-5 100%
6 50%
7 40%
8 30%
9 20%
10 10%
B. The forgoing repayment to the Village shall be made within thirty days written notice
to Dominick's, or its successor or assignee.
SECTION 12. Litigation.
No party hereto, nor the Facilitator,nor their respective successors and assigns, shall challenge the
legality or enforcement or any recital, provision or covenant of this Agreement. In the event any
other person or entity attempts to enjoin or otherwise challenge the validity of any recital, provision
or covenant of this Agreement, the Village, at Dominick's request, agrees to vigorously defend this
Agreement and not to take a position adverse to enforcement of the same. Dominick's, shall petition
to intervene in any such action or proceeding and to participate, at its sole cost, in the defense of any
claim against the Village which challenges the legality or enforceability of any recital, provision or
covenant of this Agreement. Dominick's shall reimburse the Village for any of its costs and
expenses (including reasonable attorneys' fees) incurred as a result of defending, at Dominick's
request, any claim or action arising out of this Agreement.
SECTION 13. Governing Law.
This Agreement shall be governed by and construed in accordance with the laws of the State
of Illinois.
A W EMERG/449687.1 12
SECTION 14. Amendment,.
This Agreement may be amended only by the mutual consent of the parties, or their
successors and assigns, by a written instrument specifically referencing this Agreement.
SECTION 15. Notices.
All notices, elections and other communications between the parties shall be in writing and
shall be mailed by certified mail, return receipt requested,postage prepaid, or delivered personally,
to the parties at the following addresses, or at such other addresses as the parties may, by notice,
designate:
If to the Village: Village of Buffalo Grove
William R. Balling, Village Manager
50 Raupp Blvd.
Buffalo Grove, Illinois 60089
with a copy to: Raysa& Skelton, P.C.
William G. Raysa
1140 Lake Street, Suite 400
Oak Park, Illinois 60301
If to Dominick's: Dominick's Finer Foods, Inc.
711 Jorie Boulevard
Oakbrook, Illinois 60523-2246
Attn.: Real Estate Department
AW UNBERG/44968).1 13
with a copy to: Katz, Randall, Weinberg&Richmond
Arnold Weinberg
333 West Wacker Drive
Suite 1800
Chicago, Illinois 60606
If to the Owner: Buffalo Grove Plaza, LLC
Kourosh Tony Youshaei
888 Beverly Place
Lake Forest, Illinois 60045
Notices shall be deemed received on the fourth business day following deposit in the U.S. Mail, if
given by certified mail as aforesaid, and upon receipt or refusal, if personally delivered.
SECTION 16. Effective Date.
A. This Agreement shall be effective as of the date written above.
SECTION 17. Mutual Assistance and Consents.
The parties agree to do all things necessary or appropriate to carry out the terms and
provisions of this Agreement and to aid and assist each other in carrying out the terms of this
Agreement, including, without limitation, the enactment by the Village of such resolutions and
ordinances and the taking of such other actions as may be necessary to enable the parties'
compliance with the terms and provisions of this Agreement. In the event that any party to this
Agreement is required to grant its consent or approval to the other party to this Agreement in
connection with any of the terms and provision of this Agreement, such consent or approval shall
AWEMERG/44968I.1 14
not be unreasonably withheld.
SECTION 18. Severability.
If any provision, covenant or portion of this Agreement is held invalid, such invalidity shall
not affect the application or validity of any other provisions, covenants or portions of this
Agreement.
SECTION 19. Entire Agreement.
This Agreement supersedes all prior agreements, negotiations and exhibits and is full
integration of the entire agreement of the parties.
SECTION 20. Successors and Assigns.
This Agreement may be assigned by either party hereto and shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and assigns.
SECTION 21. Owner's Consent.
The Owner does hereby acknowledge and consents to this Agreement. The Owner further
acknowledges that this Agreement provides for needed improvement on the Subject Property and
further recognizes the benefits achieved by the enhancement of the economic development of the
surrounding area.
MVEMBERG/449683 1 15
IN WITNESS WHEREOF, the parties have executed this Contingent Infrastructure
Agreement as of the date first written above.
VILLAGE OF BUFFALO GROVE, an Illinois
Municipal Corporation,
Y
Its: President
ATTEST:
--Village Clerk
DOMINICK'S FINER FOODS, INC., a Delaware
Co ation
Its: A-ssist�t Vice President
ATTEST:
By:
Its: Assistant Secretary �.- .....
Owner
Buffalo GPI LC
L^'L/
By:
Its:
ATTEST: `��`
By:
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Its:
4/26/01 2:30 PM
AWEINBERG/449683 1 16
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