The Village of North Riverside will give out a total of $750,000 to two local businesses to help defray the cost of future expansion projects. On Sept. 4, village trustees signaled their support for the two “business district grants”-$150,000 to Edward Don & Co. for a parking lot expansion and $600,000 to Joe Rizza Ford for a remodeling project to accommodate a new line of vehicles.
The board is expected to give its final OK, via a pair of ordinances setting forth the terms of the two grants some time in October, according to Village Administrator Guy Belmonte.
The village, as it has done in the past, will look for short-term financing options to obtain the money for the grants. For example, two years ago, North Riverside granted Best Buy $500,000 for its expansion at the North Riverside Plaza in exchange for a promise that the electronics retailer would stay in the village until 2018.
According to Belmonte, North Riverside will consider granting money for important commercial development if the amount of the grant can be recouped in three years. The financing deals for the grant money, therefore, typically are repaid in three years.
“The mayor and the board pride themselves in not having a TIF [tax increment financing district],” Belmonte said. “This is the way we help businesses. The additional money that [the development] will give us will pay for [the grant] in three years. Then the money [for example, sales tax revenue] is ours.”
Edward Don & Co., the world’s leading distributor of restaurant and foodservice supplies, has had its headquarters at 2500 Harlem Ave. in North Riverside since 1970. During a meeting of the village’s finance committee in August, Edward Don & Co. CFO Jim Jones told trustees that his company had added 60 employees and needed to expand its parking lot.
Initially, the company suggested adding parking along Harlem Avenue. However, North Riverside’s village engineer, John Fitzgerald, estimated that expanding along Harlem Avenue would cost $300,000-$500,000, with 30 percent of the cost related to excavating the earth berms that border Harlem Avenue.
Later, Edward Don & Co. suggested expanding the lot to the west, a project that would cost $150,000. Mayor Richard Scheck suggested that the village provide the company a grant for the full amount provided that Edward Don promises it would not move before 2012.
Belmonte said Edward Don & Co. is looking to complete the parking lot expansion this fall.
Joe Rizza Ford, which received a similar business district grant when it remodeled its showroom a number of years ago, will be remodeling again in order to accommodate a Lincoln-Mercury line. According to Rizza Ford CFO Dan McMillan, Rizza is still putting together final details for the purchase of a Lincoln-Mercury franchise.
Rizza plans on a $3.5-million remodeling project to its existing business on the northwest corner of Harlem Avenue and Cermak Road and expects the new line to add $25 million in sales. Part of that project, according to McMillan, would be to renovate the body shop, which is currently underused, into a showroom. The body shop building was built by the dealership in 1984.
“With estimated additional [sales tax] revenue with Rizza, we’re talking $200,000 to $250,000 a year,” Belmonte said.
With that figure in mind, Scheck called for the village to grant Rizza $600,000 to help defray the cost of remodeling. In exchange, Scheck called for the grant agreement to state that Rizza will not leave the village for 10 years.
No timetable has been set on when work will begin on the improvements. McMillan indicated that work would not begin until at least 2008.
The grant money will not be turned over to Rizza until the renovation work commences, Belmonte said.