Development of a Dutch Bros Coffee franchise near a well-traveled Peoria intersection will benefit from a tax reimbursement deal to offset some project expenses.
Rockford-based RSCC Group, Inc. is building the popular drive-through beverage shop on the vacant southeast corner of University Street and War Memorial Drive. The total project is estimated to cost more than $1.4 million.
Under an agreement unanimously approved Tuesday by the Peoria City Council, the developers will be reimbursed for 50% of expenses eligible under tax increment financing [TIF] district guidelines, with a cap of $1.2 million.
“This is going to be a good development. The TIF has been established, this is what it’s here for,” said council member Alex Carmona.
The Dutch Bros site in Peoria will be the chain’s eighth Illinois location. A franchise in Bloomington opened last month.
“They’ve broken ground, and I know a lot of constituents are looking forward to having Dutch Bros on the corner there,” said Carmona.
TIF reimbursements will only start once the project begins generating tax revenue. However, RSCC will only be getting a portion of those reimbursements at the outset.
An existing agreement with a prior developer for infrastructure work on the site’s shared driveway already commits 75% of the available tax increment to reimbursement for that part of the project.
“That agreement sets aside any future tax increment that’s generated from the site would go towards that agreement first,” said City Manager Patrick Urich. “Once that’s been paid off, then ultimately the increment will go back up, and they’ll be able to get more reimbursement back from Dutch Bros.”
The council originally approved plans for the Dutch Bros site in May of 2025, with the shop expected to occupy about 1.5 acres of the full 4.5-acre former auto dealership property. Future development is expected to add a second drive-through business just east of the Dutch Bros.
In a separate action, the council approved a reimbursement plan for development of the Keller Station multi-tenant commercial center on Knoxville Avenue, tied to an existing business development district [BDD] established in 2022.
The BDD imposes a 1% sales tax within the boundary, and the updated agreement will use those funds to reimburse 75% of private development costs and 90% of related infrastructure improvements.
The Keller Station BDD generates about $50,000 annually, with around $190,000 collected to date. The reimbursement funds will be capped at $1.975 million.
The approval vote was 7-0, with council member Mike Vespa abstaining as a legal representative of the developer.
Other business
The council spent 50 minutes discussing whether or not to overturn the Historic Preservation Commission’s denial of a certificate of appropriateness related to stucco wall repairs at a private property in the 800 block of North Prospect Road.
Some council members felt the property owner should be permitted to have the repair work done, while others expressed concern of setting a precedent by reversing the commission’s ruling. Ultimately, the council voted 5-3 in favor of the appeal, with Mayor Rita Ali, Bernice Gordon-Young and Andre Allen opposed.
In other action taken under regular business, the council approved receipt of the police department’s annual grant for the Tobacco Prevention and Enforcement Program in the amount of $17,000.
A report-back on the progress of the East Village Growth Cell as requested by council member Tim Riggenbach was received and filed. The tax increment financing [TIF] district was established in 2010 and will remain active until 2034, supporting reinvestment in residential, commercial and workforce development.
“A lot of times, TIF districts are misunderstood by people, and I think this is a good example of it benefiting the business community as well as the neighborhood,” said Riggenbach.
Items approved as part of the consent agenda include:
- Spending about $46,000 on a new Ford Explorer Interceptor for the police department, and another $25,000 to equip the vehicle for patrol needs;
- A one-year renewal of existing property and commercial auto insurance coverage from Liberty Mutual at a cost of $570,000, a decrease of 14%;
- Contributing slightly more than $64,000 to the Tri-County Planning Commission for the 2027 fiscal year, as part of an existing joint funding agreement;
- An amendment to the special service area for Westlake Shopping Center to reflect a banking services change;
- A series of 10 appointments and re-appointments to various boards, committees and commissions.
At council member John Kelly’s request, a vote to deny a short-term rental in the 3600 block of North Gale Avenue was deferred until the next meeting, so council member Denise Jackson can be present because the property is in her district.
Kelly also pulled from consent a boundary amendment for the Peoria Urban Enterprise Zone that adds parcels in the former Exposition Gardens, the Grey Oak Subdivision, War Memorial and Monticello Drive, and the north Allen Road commercial corridor.
He noted the amendment prevents the council from pursuing additional incentives for development at Expo Gardens. The measure passed unanimously.
As part of the approval for a series of site improvement projects at the Islamic Center of Peoria, Allen added an amendment requiring the addition of an ADA-compliant sidewalk along Charter Oak Road within two years.
“The goal, talking to our partners at the county, is to — when funding come available — to have sidewalks along Western Charter Oak,” he said. “We want to make sure that we are stepping in that direction to make West Charter Oak more pedestrian friendly.”
