Riverside’s Board of Trustees appears to be moving toward granting economic incentives in the form of sales tax breaks and fee waivers to attract new businesses officials believe can pay dividends in the future.

At a meeting of the village board on Aug. 20, trustees to varying degrees supported the notion of incentives — a new concept to Riverside — after being pitched on the idea by two local businessmen who are contemplating new restaurants in downtown Riverside.

“This is really radically new ground for Riverside,” said Village President Ben Sells.

Last week’s discussion was triggered in part by a building permit application submitted by Scott Zimmer, owner of The Chew Chew, the restaurant in downtown Riverside. Zimmer is proposing opening a sandwich/salad restaurant, called Sawmilly, at 35 E. Burlington St., directly east of The Chew Chew. Zimmer purchased the property in 2013.

Along with the building application, Zimmer sent an email to Sonya Abt, the village’s community development director, stating he was “in favor of any economic incentives that could benefit successful completion” of his new restaurant.

On Aug. 19, Patrick Leone, the owner of the Village Center development at 10 E Burlington St. added his voice to the conversation with a letter to Abt requesting that the village board offer incentives to property owners and new business ventures.

At the village board’s Aug. 20 meeting, officials stated Leone was negotiating with a prospective restaurant tenant for the long-vacant ground-floor corner retail space at the Village Center. 

Reached on Monday, Leone said, “I am currently exploring several alternatives and concepts which would anchor the [Village Center].” 

Leone characterized incentives the village could provide as “a comprehensive package of strategies and tools to assist new or expanding business development” and encouraged Riverside to “embrace change and assume some risk to encourage new business development.”

The village board could move quickly, by as early as Sept. 7, to approve some sort of incentives package for Zimmer’s venture, though trustees say they want more information on what’s being proposed.

“I know nothing about the restaurants or the operator [involved in the Village Center negotiations],” said Trustee Doug Pollock. “Before I know more about it, I’m not willing to give them anything. Is this a business we want to invest taxpayer dollars into?”

Liz Peters, chairwoman of the Riverside Economic Development Commission, which serves in an advisory capacity to the village board, told trustees on Aug. 20 that incentives are a tool the village ought to use to attract new businesses.

“The idea that we as a village could show these entering businesses that we’re here to support them and that we want to give them as many incentives as possible, it would go a long way,” Peters said. “Having that positive message out there would hopefully have a snowball effect with new businesses as well.”

That message was reinforced by Sonya Abt, the village’s community development director. Abt said offering some type of economic incentive would allow Riverside to compete with neighboring communities that offer tax breaks and even cash payouts to seal deals with prospective business owners.

“Staff believes that for us to be competitive and to just offset the cost of doing business in Cook County that it’s important to offer some sort of economic incentives to people who are looking to open and invest in our community,” Abt said.

Trustee Ellen Hamilton enthusiastically supported the idea of offering incentives, particularly for retail businesses, which Riverside has trouble attracting.

“We’re great for service businesses, but in terms of attracting businesses for people to come in [to the village], we don’t do so well, and on top of that we don’t offer incentives,” Hamilton said.

“Let’s be bold.”

Incentives are likely to be considered on a case-by-case basis, with some trustees cautioning that the village needs to derive a benefit from the deal in exchange for any short-term tax or fee breaks.

“I don’t think we’re Santa Claus here,” said Trustee Michael Sedivy. “There has to be a need and we have to evaluate the opportunity.”

On specific incentive mentioned last week was a short-term rebate, perhaps for three to five years, of the village’s 1-percent tax on food and drinks sold at local restaurants. The village also instituted a 1-percent non-home rule sales tax about a decade ago.

It’s unclear whether those taxes can simply be waived, since they must be reported to the state. However, the village could work out a deal with a business to rebate those taxes.

In the case of a restaurant business like The Chew Chew, said Sells, the rebate on the places of eating tax would be in the $6,000 to $12,000 range per year.

“It seems to be something the village can realistically do,” Sells said.

The village could also waive all or a portion of building permit fees, which depending on the scale of the project could save a developer thousands of dollars.

“It could be $5,000 to $10,000 depending on the size of the job,” Abt said.

Trustee Joseph Ballerine suggested setting aside money the village collects for its places of eating tax into a fund specifically to address economic development.

“If we can help one of these big spots flip, that will always pay dividends to the village,” Ballerine said.

6 replies on “Riverside mulls financial incentives for new businesses”