Elwood sues Centerpoint Properties, village wants to know how tax dollars were spent
By Janet Lundquist email@example.com February 7, 2013 6:18PM
Workers build a bridge in 2001 for the 2,200-acre Centerpoint Intermodel Center in Elwood. | Sun-Times Media file photo
The billion-dollar project proposed by CenterPoint Properties was supposed to put the small town of Elwood on the map.
Not only would CenterPoint build Deer Run Industrial Park there, but the company promised town leaders it would bring restaurants, hotels, shopping and 12,000 new jobs.
Elwood officials agreed to help CenterPoint develop a 1,820-acre site on the former Joliet Arsenal property with $150 million in tax dollars through a Tax Increment Financing district.
Now, more than 12 years later, village officials say the jobs and new development have not materialized like the company said.
And when CenterPoint officials refused to allow village leaders to see how they’ve spent the tax dollars, Elwood officials took them to court.
The village filed a lawsuit Thursday in Cook County against CenterPoint Intermodal to force the Oak Brook-based company to detail how it spent the TIF money.
“CenterPoint made a lot of promises in order to secure $150 million in taxpayer dollars,” village President William Offerman said in a press release.
CenterPoint officials released a statement Thursday afternoon that said they believe the lawsuit is “baseless and counterproductive.”
“CenterPoint is disappointed and surprised at Elwood’s decision to file this suit,” the statement said. “CenterPoint took an abandoned Superfund site and, with the help of many others, turned it into one of the most successful transportation hubs for global commerce. Thousands of jobs and millions of dollars of economic benefit have resulted from this project, and Elwood has been the beneficiary in multiple ways.
“Any funds we have received under the TIF program were a fraction of the moneys we spent on the project and were only lawful reimbursement for investments made by us,” the statement said.
A Tax Increment Financing district establishes a “base” property tax value for a certain number of years. When the property values increase, the money above the initial base value is collected in a special fund to use for redevelopment of the district.
The Deer Run Industrial Park was heavily subsidized by the TIF money, the lawsuit claims.
If the company received $90 million in TIF money, CenterPoint pledged to invest about $840 million of its own money, the lawsuit claims. But the company has not produced any records showing how much was privately invested in the project.
The village issued $150 million in TIF notes to subsidize Deer Run Industrial Park, which could only be issued if CenterPoint projected enough tax revenue to repay the principal and interest by 2023. But the revenue being generated by the park is not enough to pay the interest alone, according to the lawsuit.
The development was supposed to include the industrial park as well as a truck stop, power plant, water and sewer treatment plant, hotels, restaurants and retail — and a projected 12,500 jobs, the lawsuit states.
So far, the company has built warehouses that brought 3,800 jobs, an intermodal facility and three times the truck traffic it predicted, the lawsuit states.