BY WILL BUSS - News-Democrat
State Rep. Jay Hoffman, D-Collinsville, and Sen. Bill Haine, D-Alton, want an economic impact study approved before a new sales tax and revenue-based funding district would be made available for developers in Illinois
A "STAR" bonds bill in Illinois could pave the way for a $1 billion, 900-acre retail and entertainment development proposed for Glen Carbon as University Town Center, funding the project's restaurants, retail and more.
State Rep. Tom Holbrook, D-Belleville, and Sen. James Clayborne, D-Belleville, are sponsoring the bill, but colleagues Haine and Hoffman filed an amendment asking that a study be completed before STAR bond districts can be established. The proposed metro-east development is located within districts that Hoffman and Haine represent.
"That concerns us greatly," Hoffman said. "What we're saying is you would have to do an impact study that would prove it would not have a negative effect before you could issue STAR bonds."
Haine said he does not know how long an impact study would take or whether it would derail the proposed project.
"I'm not going to vote for this bill unless I see for an impact," Haine said. "I voted for it in the Senate under the impression that it would only create winners. But my mayors tell me that's not correct."
"We're still working on it," Holbrook said. "I would say that we're trying to be as responsive to all parties as we can. We're not going to make all parties happy, but we are going to try. We're going to try to meet as many concerns as we can."
University Town Center spokeswoman Rebecca Rausch said language soon will be introduced into the bill that includes provisions to protect communities surrounding STAR Bond districts from losing their retail businesses, which might otherwise seek to relocate into a STAR bond district. The bill has passed the Senate and sits before lawmakers in the House.
The amendment states that retail sales taxes cannot be used to amortize STAR bonds if the sales are derived from a business which occupies more than 20,000 square feet of retail space and which closes a store within a 25-mile radius in the state in order to relocate to the STAR bond district. Among the proposed changes, the amendment defines "local sales tax increment" to leave existing local sales taxes in place and capture only the increment for STAR bonds purposes. It removes language that allowed STAR bonds to be used with other incentives and specifically states that no portion of a STAR bonds project can be financed with tax increment financing.
The St. Clair County Board passed a resolution Monday opposing STAR bonds, stating such developments "would result in an unfair negative impact on existing and future commercial development in St. Clair County and its municipalities."
County Board Chairman Mark Kern could not be reached for comment Tuesday.
Rausch said the board has not had an opportunity to review the new amendment.
"(The amendment) makes great strides to protect existing and future economic development and municipalities' interests," Rausch said.
Southern Illinois University Edwardsville's School of Business: Economics & Finance completed an impact study on the University TownCenter before the project and bill were introduced earlier this spring. The study concluded the development would provide more than 4,000 jobs in the area at its peak and more than $200 million in local income plus more than $15 million in state and local tax revenue. Once completed, the retail, office and hotels are projected to create almost 1,700 new jobs and more than $60 million in local income as well as more than $16 million in state and local tax revenue.
Haine called that study "absolutely insufficient."
"It just shows what they estimated that they will spend in STAR bonds," Haine said. "That's one factor to consider, of course. But we have to consider other factors."
Contact reporter Will Buss at wbuss@bnd.com or 239-2526.