Customers at stores in Peoria's Glen Hollow Shopping Center will see a slight sales tax increase next year, with the revenue earmarked to redevelop the area.
Following a 40-minute discussion at last week's meeting, the Peoria City Council voted to establish the Glen Hollow Business District over opposition from two members. The designation imposes a 1% retailer's occupation and service occupation tax within the district.
“This is not something that I take lightly, as someone who’s trying to balance my own household’s finances,” said Fourth District council member Andre Allen, who represents the area where Glen Hollow is located.
“But I know, in talking to my constituents and talking to many others, the amenities that you all want to have living in an urban city like the City of Peoria. You want to have quality shopping options, and this is how we can sustain this.”
The goal of the business development district and the added tax is to thwart continued deterioration of the area, revitalize the infrastructure, and reduce the number of vacant storefronts.
“The money that is being utilized for this would go back into not just the infrastructure of the building, but the infrastructure of the area,” said Assistant City Manager Kimberly Richardson.
“Lighting, any type of road that the city might even own, would be able to utilize these funds to be able to ensure that the area is maintained appropriately, so that we don’t get to a point of deterioration of where we have to look at demolition of property.”
Earlier this year, Best Buy relocated from the Glen Hollow area to East Peoria’s Levee District. Richardson explained that has left Glen Hollow with a large opening that would either need to bring in a new “big box” retailer or be divided and rezoned for multiple uses.
“With Best Buy leaving, and we have a very large parcel that is vacant, [and] the property owners coming to us trying to think of ideas and solutions to how they can bring different types of business into that space,” said Richardson. “We worked and connected with them, with other businesses are interested in locating in Peoria, and the problem comes down to cost.”
Alex Carmona and John Kelly voiced strong opinions against creating the business district and adding the 1% tax that goes with it.
“I have good friends in the ownership of this shopping center. Nevertheless, we seem to be on a trend that says to me, this is going to keep going and going and going,” said Kelly. “If we approve this, it’s another signal to shopping center owners to let their properties deteriorate. That way they can get the taxpayers to take care of their properties.”
Carmona said the added tax puts the cost of maintaining and improving the property on the public, when it’s something the shopping center owners should’ve been doing themselves already.
“I believe that we can do better by citizens of our city. I think that we need some sort of policy, some due diligence to identify properties that are actually in need by looking at vacancies, what I would just say is ‘actual blight,’ new investments,” said Carmona.
“Something that requires accountability and safeguards our citizens from bailouts and routine expenses that are supposed to be now paid by them. Also a policy that treats local entrepreneurs and national chains fairly, so we’re not just benefiting big box stores.”
Carmona moved to defer the council's vote until the city could establish the type of policy he recommended to set objectives and criteria for business development districts. The deferral failed after Richardson noted any delay would close this year's window to set the Glen Hollow district and force staff to restart the entire process.
Council member Zach Oyler supported the creation of the development district, suggesting that for too long, the city’s failure to provide business incentives has driven retailers away from Peoria.
“I know for a fact that Dillards is not here because we weren’t willing to do this some years ago. Von Maur isn’t here because we weren’t willing to do this. Bergner’s is gone because we weren’t willing to do this. We have to be willing to compete, that’s the reality of the situation,” said Oyler. “We can sit here and say we don’t want to do the things that it takes to get the retail and to give our citizens the amenities that they ask for. But what’s the alternative?
“Are you OK just sitting by and watching our constituents complain about the fact that we don’t have these things and somebody else does? Somebody else is getting the tax revenue off of those things that we could be getting. Somebody else is getting the property tax revenue off the buildings that are occupied when we’re talking about how we’re going to satisfy the vacant strip malls.
Council member Tim Riggenbach said he was originally skeptical about the use of business development districts and special service areas, but has come around to see them as vital economic tools.
“We all know how struggling the retail environment is across the country, and we are just a microcosm of that,” said Riggenbach. “So for us to tell the business owner that us 11 people around this horseshoe know what their business needs better than they do, I think that’s kind of insulting.”
The Glen Hollow development district and sales tax increase will take effect July 1.
Next year, the council will consider a similar special service area designation for the Westlake Shopping Center. A public hearing on that action was set for Feb. 24.
