The City of Peoria is getting closer to unveiling redevelopment plans for the downtown block anchored by PNC Bank Building.
City Manager Patrick Urich said the city received proposals from three developers, and has been in talks with the one of them about the desired vision for the three properties dubbed “the Tower on Adams.”
Peoria purchased the tower at 301 SW Adams S., the adjacent Creve Coeur Building and accompanying parking garage for $1.75 million in 2024, in hopes of attracting a mixed-use residential and commercial development.
Last month, the Peoria City Council approved creating a new Adams-Liberty tax increment financing [TIF] district to facilitate such a project.
Urich spoke with WCBU reporter Joe Deacon about a range of topics, including the planned redevelopment and the end of Peoria’s quest for a land-based casino.
This transcript has been edited lightly for brevity and clarity.
WCBU: Let’s start with the Tower on Adams project, the PNC Bank Building and adjacent properties downtown that are currently owned by the city. Where do things stand with choosing a developer for the site, and what is the ultimate vision for what that will become?
Patrick Urich: We had three developers that submitted proposals. We have shortlisted one of those developers that we’re currently negotiating with. The negotiations have taken a while; we’re still kind of going back and forth on a few items. We hope that in the next, you know, month to month and a half, we should have something that we’ll be able to bring back to the [city] council for them to consider.
The intent would be that we would be looking at taking the PNC Bank Building, the [former] Commercial National Bank Building, and converting that into residential, and then looking at retaining PNC in the first floor. Then, we’ve got some discussions that we’re working with the developer on about the rest of the block, and that’s something that as those negotiations kind of crystallize, we’ll be able to let the public know what that would look like.
I think you mentioned at the last council meeting that the parking garage itself may not be salvageable and may need to have a new one built, or something like that?
Urich: Yeah, I think one of the challenges with the parking structure is that to fix that current structure, it’s going to take $7-8 million. So I think we’re looking at what’s feasible and what’s really feasible on the block in that area, knowing that the city has the Jefferson parking deck, which is literally next door, which provides an opportunity for additional parkers for people that are there.
That’s something that we have to continue to discuss and hammer out with the developer, and that will be part of those discussions that we hope to finalize and then present to the council in the near future.
The city council recently approved a TIF district for that location, as well as one for Northwoods Mall. How will these TIF districts attract investors and assist the desired projects?
Urich: The TIF and having a new 23-year TIF on the PNC block is vital. Number one, it’s important because the assessed value of the properties have gone down below their base EAV when they were established as part of the Warehouse District TIF, or the Downtown Conservation TIF. So this allows us to basically reset the base EAV, which will allow more of that TIF money to go into the redevelopment of the property. So, it’s very important for the PNC block.
Around Northwoods Mall, you know, we have Northwoods Mall, which is doing great. It’s got a challenge with one of the anchors, with Sears being gone, of trying to find another anchor tenant for it. But one of the things that we’ve been really trying to explore is looking at what other communities are doing around their large indoor shopping malls, which is looking at infill development.
A good example of that is the Fox Valley Mall in Aurora. In the inner ring around the drive that was created around the Fox Valley Mall, there’s a couple of apartment complexes that have been built. So there may be opportunities for that type of infill development that will take up the sea of empty parking spaces, and look at ways that we can redevelop that.
In addition, there are properties along Brandywine Drive that will be very important to be targeted for redevelopment, that we’re more hopeful that the TIF will help us to encourage redevelopment of those properties, as well as across the street at Westlake Shopping Center and other areas.
Turning to the casino saga, the Illinois Gaming Board last week approved the revised renovation plan for the existing Par-A-Dice location in East Peoria. Prior to that, the city withdrew its lawsuit to block the original plan. Does this mean that the matter is now closed from Peoria’s standpoint, or will the city look at pursuing this further?
Urich: No, I think from this end, the book on that has closed. I think what we’re really looking at is if they are going to build on water, which is a permanently moored barge, that’s legal under both the intergovernmental agreement and under Illinois laws. So I don’t think there’s any reason that the city would pursue any other additional legal issues.
We objected to their first plan that we felt was a land-based casino. So, this is something that they’re certainly allowed to do. Having the casino, we still share in the gaming revenues with the City of East Peoria, so we hope that Boyd [Gaming] is very successful.
I realize you are an administrator and not a politician or an elected representative, but do you think the council made a misstep in declining the settlement offer that Boyd Gaming made before they switched their plan?
Urich: I think that policymakers came to those decisions, and they didn’t come to them very easily. I think that there was a number of arguments to be made on both sides. That is, I think, the beauty of a local government system and a system of democracy, is that we’re entrusting our elected officials to make decisions in the in the position that they feel is best.
And I think that if you ask each and every member of the council and the mayor, I think they would say that they made the decision based on what they thought was the best for the city. So, I can’t fault any member of council for a decision that they make on any topic. They come to those decisions thinking, what is in the best interest of the city.
With that in mind, though, the staff’s recommendation was to accept the proposal. What could that have meant to the city?
Urich: It would have meant additional revenue to us that we would have been able to plan for and build into our budget. But, again, once the decision was made by the council to not accept that settlement, then we moved right onto litigation because that was the position that we were in and that we knew that we were going to have to be in.
So, in a system where we have elected policymakers and we have the professional staff, when the elected policymakers make their statement of direction of policy, then it’s our job to carry it out.
Also at the most recent council meeting, the members approved a method for funding some projects and purchases that relate to the bond market, with some potential volatility in the market, and the timing of how the city pays itself back. Could you kind of try to explain this as simply as possible, and why that approach was considered?
Urich: Normally, what we’ll do when we plan on issuing debt, is that we will issue a ... whether it’s called an inducement resolution, or we’ll just start to issue the notice that we’re going to start to look at issuing debt and then go out and time it with the market. At this point in time, our finance director and our financial advisors have said that with just some of the uncertainty in the market, we might want to time this issuance later in the year.
We had budgeted and built our budget on the issuance of about $8 million worth of bonds. So this is just a way that we’re able to time it, looking at what the interest rates might do. I think that’s something that we have to be mindful of. I think that it’s looking at when is the best time to go out to market for the city to get the best interest rate.
How would you characterize the city’s current financial outlook?
Urich: I think that our financial outlook is still very strong, regardless of the way in the manner in which we’re getting our advice on this issue. We have healthy fund balances in place, which are really affording us the opportunity to absorb some additional pension costs and obligations that we have from that.
Our biggest headwinds that we as a city face are state and federal mandates — the state mandate being pension costs and pension obligations, and the federal mandate being the Clean Water Act and the Combined Sewer Overflow. Those are the two issues that over the next 15 to 20 years we’re going to be dealing with and that we’re going to be working through.
But in addition, I think that we have investments that we need to make on infrastructure. We have investments we need to make to position the city for growth. We have the investments that we need to make in our neighborhoods. We have to provide services to the public, and we fully intend to do so.
A couple months ago, Peoria gave the green light to the Hengst Foundation’s riverfront amphitheater plan. What are the next steps in that process and the city’s next responsibilities for moving the project forward?
Urich: We’re really excited about the amphitheater project. Currently, the design team has been garnering some input from the Civic Center Authority and the [Peoria] Park District to build in the capital side of the of the design, and how they design the amphitheater to minimize its impact on [their] operations, but also be able to attract the types of acts that we might want to see on the riverfront.
We’re about halfway done with the design of the plans, and then once they’re done, we’ll bring those back to council and roll that out for the public to see. Then we’re going to be working with Core Construction on actually building that out, so they’ll be costing out with their subcontractors. That’s what’s the next step is, they’ll be costing out with their subcontractors what we need to build the project.
We’re moving full speed ahead to hopefully see in 2027 that we’re able to have the first concert.
What are some of the key items on the agenda for the next city council meeting?
Urich: The upcoming city council meeting, we have the Westlake special service area request, which includes the request of extending the special service area out to 2055 and then increasing the sales tax from 0.75% to 1%. So, that’ll be discussed by the council.
Then we have — over the last couple of years, really starting with COVID, we started waiving the fees for food trucks and food carts in downtown to encourage their operation. We’re looking to do that again as well. That’ll be on the agenda, with the intent that hopefully we’re able to expand the number of food trucks with the opening of the two-way streets [conversion of Adams and Jefferson] in downtown this spring.
