Public Watchdog.org

It’s Shakedown Time At City Hall

05.28.19

It was political philosopher George Santayana who famously said: “Those who cannot remember the past are condemned to repeat it.”

This post is for the benefit of the current members of the Park Ridge City Council and City Staff who either never knew, cannot remember, or just don’t care about the City’s relatively recent past as they address one of the more important items on tonight’s (May 28) Council agenda: Taxpayer subsidies to the developers of a proposed “boutique” hotel on the current Mr. K’s property down on Higgins.

We don’t object to a hotel – “boutique” or otherwise – in Park Ridge or on that property. What we do object to are money-grubbing developers and money-grubbing property owners who seem confident they can shake down our City officials into handing out what amount to bribes as incentives to certain development projects in our community.

Shake them down how?

According to the Agenda Cover Memorandum of C.P. & D. Director Jim Brown, how about with seven years of hotel tax rebates after the City more than doubles its hotel tax?

How about by waiving building permit fees that could run as high as $200,000?

How about by paying for architectural/design fees up to $250,000?

How about by rebating the City’s incremental property tax increases on the property for a period of seven years?

All of those shakedowns are intended to take money out of Park Ridge taxpayers’ pockets and put it in the pockets of developer Scarlett Hotel Group (“SHG”) and the owners of Mr. K’s – based, of course, on various projections and calculations (even the worst of which will be rosy) intended to convince folks that the requested bribes will still be a great deal for the City.

If you think you may have seen this movie before, you have.

You saw it back in 2003-05, when interim-mayor Mike Marous and then-city manager Tim Schuenke sold a bovine city council on the idea of subsidizing the private redevelopment of Uptown by borrowing many millions of dollars (secured by the City’s issuance of general obligation bonds). Not surprisingly, all the rosy projections of a $23 million return on that “investment” proved bogus, and when those bonds are finally paid off the City will likely end up booking a several million dollar loss.

Now contrast that with the situation seven years ago, when developer Lance Chody thought he could sucker Mayor Dave Schmidt and the then-council into believing that Whole Foods would only come to Chody’s stagnant property on Touhy and Washington in return for approximately $2 million of sales tax revenue sharing. A number of residents, including many members of the local business community, foolishly bought Chody’s pitch and demanded the mayor and the council comply.

Schmidt’s and those aldermen responded like the taxpayers’ champions: If WF needs a bribe to come to Park Ridge, it must not really want to be here.

Two weeks later, Chody and Whole Foods came back before the Council and said they would do the deal without the revenue-sharing windfall.

Just saying “no” to these kinds of shakedowns should be the automatic default mechanism any time such demands are made. Unfortunately, none of the current aldermen were part of that 2012 council that hung tough against Chody and Whole Foods, so there’s no way to predict whether any of the current seven have the spine to stand up to whatever pressure might be applied, or emoluments offered.

Not surprisingly, Brown’s memo has a few baseless conclusions that appear designed to encourage the City’s cutting a deal with the developer and property owners, such as: “In particular restaurants would benefit from the influx of hotel patrons.”

That might be a reasonable conclusion if the proposed hotel were in Uptown. But down near the City’s southwestern boundary, hotel patrons are more likely to be lured away to Rivers Casino and its restaurants, or to that garish garden of earthly delights called Rosemont.

Brown’s memo also doesn’t attempt to quantify the cost to the City of those seven years of rebates not only for the increased hotel tax but also for the City’s incremental increases in its property tax revenue. And although the memo references certain April-May correspondence between SHG and City Manager Joe Gilmore, none of that correspondence is included with Brown’s memo.

So much for transparency and accountability by Gilmore and Brown.

At the end of the day, however, this isn’t about speculative restaurant revenue and all the other happy horsebleep that anybody conjure up out of whole cloth to market this idea to the feeble-minded. It’s about the bottom line public policy questions:

1. Is Park Ridge so desperate it should allow itself to become an easy mark for these shakedowns?

2. If the hotel developer really wants to be in Park Ridge, why does it need a bribe?

Let’s see if either of those gets answered tonight.

To read or post comments, click on title.

8 comments so far

Good call on this, PW. You know any concessions the developer gets from the City will just go into its and/or seller’s pocket.

This “boutique” business also sounds like sizzle instead of steak. 100-125 rooms, no restaurant, maybe a bar. Big whoop. It could end up a Days Inn.

Lastly, I’m already hearing how this hotel would be great because it would have no enrollment impact on our schools. But that property is currently zoned only for business, so as long as the City doesn’t do something stupid like re-zone it for multi-family residential, it’s going to be business or nothing.

EDITOR’S NOTE: Agreed.

The Council seems to be turning into a baseball player with no sense of the strike zone, swinging at every pitch in the hope of hitting something.

Seems to me you have completely missed the real issue. Will the parking lot at this structure be concrete, asphalt or green pavers??

EDITOR’S NOTE: That all depends on how much ankle grabbing the aldermen are willing to do for the hotel developer – and what kind of secret deal Moran can work out with MWRD.

At least with Whole Foods we knew we were getting a Whole Foods, not some mystery market. But Maloney’s posting on FB about how excited he is about it (great poker face, mayor), so let’s just give them what they want and get it over with.

EDITOR’S NOTE: Where did the mayor say “how excited he is about it”?

If Gilmore’s correspondence with the developer was important enough for Brown to mention it in his memo, why isn’t it attached to that memo? Sounds like Gilmore was engaging in some Chicago style wink and nod that neither he or the developer want the public to see.

EDITOR’S NOTE: That’s what we were thinking.

Once upon a time you were a fan of putting a hotel in the Higgins Corridor west of Cumberland. Now that City Hall is finally working to make it a reality, you don’t like the idea. Are you schizophrenic?

EDITOR’S NOTE: We have always been fans of a hotel in Park Ridge, including on the Mr. K site, which you can read about in several of our posts including our 01.07.2009 and 06.16.2009 posts. But we rarely (if ever) have supported bribes to developers.

We don’t think that qualifies as “schizophrenic” per DSM-5.

So if the mayor supports it, what are the chances that it passes?

EDITOR’S NOTE: 100%. Based on the mayor’s nose count at last night’s meeting, it’s already 5 (Moran, Wilkening, Melidosian, Mazzuca and Joyce) to 2 (Milissis and Shubert). And Milissis will be gone in another week or so, most likely to be replaced by somebody with a POV different from his.

Of course there will be a variety of Kabuki performances by those “politicians” around The Horseshoe so that they can pretend to be deep thinkers and defenders of the public purse. But to paraphrase the late-but-totally-corrupt IL Sec’y of State Paul Powell: “We can smell the meat a-cookin’.”

I just finished watching the video of the hotel portion of last night’s Council meeting and this is sounding like a done deal. Softball questions lobbed all around, only Milissis and Shubert (and resident Joan Sandrick) objecting to the hundreds of thousands of dollars in incentives, staff (Gilmore and Brown) ready to start negotiating, and they don’t even know what kind of hotel it might be, other than there’ll be no restaurant (just a little pantry), and low-end room rates that the mayor, Council and Staff are treating like it’s going to be a Four Seasons.

EDITOR’S NOTE: We haven’t made it through the whole “hotel” portion of the video, but everything we’ve seen and heard is exactly as you say.

Interesting, after watching the video it reminds me of the deals/incentives Frimark and gang would cut and be crucified later for doing so. At least aldermen Milissis and Schubert clearly do not support the incentives, but it appears both aldermen Mazzuca and Melodosian struggle taking a side and aldermen Moran, Wilkening and Joyce have already folded like cheap suits. In any case, it appears the Mayor’s math sees five votes, likely making this a done deal for all practical purposes. Sigh, the more things change, the more they remain the same. Agreed, time for a shakeup.

EDITOR’S NOTE: “[T]ime for a shakeup”? Moran and Wilkening just got re-elected without opposition to 4-year terms; Melidosian and Joyce got elected to their first full 4-year terms; Milissis is leaving next week; and Mazzuca and Maloney have almost two more years left on their terms.

Even Penn and Teller couldn’t figure out how to “shakeup” this Horseshoe.



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