City of Lexington City Council met October 8.
Here is the minutes provided by the council:
The regular meeting of the Lexington City Council was called to order at 7:00 p. m. by Mayor Spencer Johansen in the City Council Chambers at City Hall.
Mayor Johansen led the council in the Pledge of Allegiance.
Roll call was taken to find the following physically present: Mayor Johansen, Alderman Schreiber, Alderman Stover, Alderman Colclasure, Alderman Franklin and Alderman Richard with Alderwoman Wilson being absent. Members of the staff and public present were: Chief Belvery, Don Cavallini, Sondra Wisdom, Tim Grusy, Angela Labertew and Joel Labertew.
It was moved by Alderman Colclasure and seconded by Alderman Franklin to approve the minutes of the September 24, 2018 regular City Council Meeting. Motion carried unanimously.
It was moved by Alderman Stover and seconded by Alderman Richard to approve the Treasurer’s Report in the amount of $21,113.40. Motion carried unanimously.
Public Input: Angela Labertew introduced herself and her husband Joel and stated that they live in Normal and have been there for four years. Before that they lived in Naperville area.
She is here regarding an application for the subsidy grant to rent the old Upper Tap space to put in a boutique. She has been in customer service for many years and manages a retail shop called Whimsy in downtown Normal for the last year and one half. She wants to do it for herself. She loves people. She wants them to come in and have an opportunity to shop and enjoy their time in her shop. When thinking of retail along with new, she will have resale of nicer items along with furniture, home décor and accessories. She will also be bringing new clothing items as well. The name will be Lavender and Lili/Occasions. Talking about making life beautiful she will do event planning but it will be different than what Old Oak Vintage does. They have large pieces that they rent out, she will have smaller pieces such as center pieces, glass ware and china that can be rented out for special events. She will also offer event planning. She will also offer craft glass for tea parties. The building is big enough for her needs and is a great space for her to offer a homey environment.
Joel is a pastor at First Assembly Church in Normal.
Angela is excited to be opening a shop in Lexington. She is embracing this and wants to start out with around 30 hours a week and graduate to more. She really wants to be open more but for now she would be open Thursday, Friday and Saturday but would prefer not to be open on Sunday but will do whatever it takes to get the job done. She has an amazing online website that is open 24/7. She is super creative and thinks outside the box.
Angela is currently working with the Small Business Association at Illinois Wesleyan and does have a business plan. She has been working with them to apply for her LLC and is meeting with them every two weeks and they have been helping her fill out her plan. She feels this is good for her as she has been trying to learn everything. Meeting with them enables her to learn from people who know more than she does and can answer all her questions.
She does not have a loan at this time but does have access to a small amount of money to get started. She does not have a line of credit but could get one if needed. Her goal is to stay under $10,000 to get started. She is being very careful with her money because she knows it is tight.
She would not be able to open without the grant subsidy which makes it more doable and the Small Business Association helping her. She has been thinking about doing this for a while but the grant subsidy really makes it doable at this time. The cost of start-up is so high. The Small Business Association has been working out our tax flow and that first year there are so many expenses.
Sondra Wisdom is very excited to have another retail store opening in Lexington. People come here to eat and want to know where the other stores are. It is a wonderful thing to be able to offer high quality retail merchandise. There are three shops in my building, this will be a wonderful addition to the town.
Rent for the old Upper Tap building is $750 per month. Angela tried to negotiate it down but the owner would not budge. He did negotiate the lease from 5 years down to 1 year. Angela needs to know what she needs to do to make this happen. She knows that the more days she is open the more she will sell. Also the more days she is open she will need to hire employees and that is an expense she is not ready for at this time. It will depend on how the town is responding and shopping.
Sondra suggested that she should be open when Kemp’s Upper Tap was the busiest and they could come to her shop while they waited. She had someone come in and bought two or three things and thought her shop was the cutest thing ever. We can make Lexington a destination.
Angela remarked that she is a team player not a competitor and wants everyone to succeed.
She has set a target opening date of November 1st with November 15th (Lades Night Out) at the latest. The sooner the better and hopes to have a large inventory as soon as she can.
New Business:
Discussion with County Tax Assessor:
Tim Grusy was asked to explain how his job of County Tax Assessor works with the County Tax Bills. Tim has been Township Assessor for about 8-10 years. He is the assessor for 10 townships in McLean County. The job requires 15 hours a year of continuing education.
When you get your assessment notice there are three lines on the assessment notice. That is the notice of what your next year’s taxes are based off of. The assessed value is 1/3 of market value, now you need to figure out what is market value. The assessment world is driven by market value. When you purchase a house all the forms, bill of sale, real estate transfer, declaration, etc., go to the Department of Revenue. The Department of Revenue will go through them and verify the transaction and forward them to the County. The County verifies a list of all sales for the County once they get it back from the Department of Revenue. All Tim is interest in is what sells and where it is located.
Tim went on to tell of the exemptions that are available to home owners:
Homestead Exemption: This is for living in the property. The billing address is the same as the site address. You are only entitled to one Homestead Exemption.
Senior Exemption: This is $5,000 off your assessment for those who are 65 years of age. You must go to the McLean County Tax Collector’s office to apply for this exemption.
Senior Freeze: If your household income is $55,000 or less that will freeze your assessment at that level when you sign up for it. That is for seniors on a fixed income.
Homestead Improvement Exemption: This is to build a garage, deck or any home improvement. This exemption is limited to the cash value of the improvement and carries for four years. Siding or anything that would improve the value of your property. This would be for outside improvements only as the assessor does not go inside your home.
The question was asked if the assessor looked at every house. The answer was that he tries to but not every year. Typically he concentrates on different subdivisions. Next year is a quadrennial year where he is supposed to go to every house and revalue everything.
Returning Veteran’s Homestead Exemption: That is a two year exemption.
Disabled Veteran’s Standard Homestead Exemption: For veterans with service related disabilities.
Disabled Persons Homestead Exemption: If you have a doctor’s statement you receive $2,000 off the property EAV.
These exemptions are available and people should take advantage of them.
Also there are your exempt property such as churches and parks. Those properties are reviewed annually through the Department of Revenue who determines whether they are exempt or not. Then they are sent to the County and the County sends out the Taxpayer Assessment Letter. By law, if they are not taken care of then their property is assessed.
The Township Assessor has three duties. He identifies the property. The assessor does the assessment on all new buildings. He gets copies of all new building permits. These permits allow him to identify what is on the property such as garages and decks. He then puts a value on the property. After he puts a value on it he turns that in to the County.
Landscaping is not included in the value of the property. Items that will increase the value of your property would be extra plumbing or bathrooms. All land is assessed separately. New homes and business buildings are prorated for the first tax year. We also use aerial photos now to help in our assessments. These photos help us to see buildings on the back of properties that we could not see before. We compare the photo to the property card and match them up for the tax owed.
After Tim turns his forms in the Notice to Taxpayer of Assessment Change Form is mailed out. There are three columns: Prior Year Assessed Value (After BOR action), Current Year Assessed Value (Township Assessor) and Current Year Assessed Value (CCAO after multiplier).
There are five listings under these columns: Land/Lot or farm homesite, Buildings and structures (non-farm), Farmland, Farm Buildings and Total.
Farm Buildings do not depreciate but they depreciate by staying the same as everything else goes up.
The middle column is the one that Tim submits. If he does not submit anything column one and two should be the same. Column three has the multiplier amount. That is the final amount that the County Supervisor sends out. Farmland changes are based off of soil types and are not done by the Township Assessor. Once these Notices go out they are posted in the Lexingtonian and the County makes sure that the paper goes to every resident. The only ones that are posted are the ones that are changed, revalued or new buildings.
Once you get your Assessment Notice you may file an appeal. To file an appeal you may call Tim Grusy at the number on the assessment. He is able to fix some of the errors. If he has included something on the assessment that is not there in error. If the homeowner feels his property is over assessed he will need to go through the Board of Review to get that corrected. He cannot change anything regarding the value of the home.
The McLean County multiplier is set by the County Supervisor. The County takes the property sales for the year that it gets back from the Department of Revenue. The average price for the houses sold for that year divided by the average assessed value of those homes equals a percentage. This percentage must, by law, be 33.33%. If it is not, the 1.000% multiplier is adjusted up or down to reflect the average of the last year’s home sales.
If your multiplier is greater than 1.000 it means that the median value in your township was less than 33.33%. If it was less than 1.000 your township median was greater than 33.33%. Each township in county and state is equalized. The goal is to get the median property to exactly one third ratio of assessment to market value.
Consideration/Vote Application Retail Grant TIF Request: Resolution 2018-3:
This is the application made by Angela Labertew doing business as Lavender and Lili/Occasions located at 217 W. Main Street, Lexington, IL.
Motion was made by Alderman Franklin and seconded by Alderman Stover to approve Resolution 2018-3 authorizing TIF grant agreement for the operation of a retail business at the property commonly described as Lavender Lili/Occasions, 217 W. Main Street, Lexington, Illinois pursuant to the terms and conditions of said agreement between the City of Lexington and Angela Labertew. Motion carried with four yes and one no.
Discussion New Road Douglas Drive:
Mark Hanson and Casey’s have reached an agreement on the price of the property and the contracts are in the mail.
The original plan was that Casey’s was going to have an entrance off of P. J. Keller Hwy. and Hansons was pretty persistent about having a road put in there and him not paying for it, we are still in talks about that. The discussion that Mayor Johansen had with Casey’s was that the City was not going to offer any incentive to Casey’s. No tax incentive, no rebates or anything else. That is not what we want to do or something that we got to pay back in relation to the TIF. We are providing some fill dirt that is not ours, it belongs to Wirtz. Wirtz is going to give that to us. Casey’s will move it. Then that almost an acre of County right of way that the County is going to deed to us we will deed that over to them without charging them.
The proposed road extends all the way north and that is not happening. Mayor Johansen suggests that we go 300 feet, maybe a little more to allow for snow removal, fire truck and a fire hydrant at the end of it. Farnsworth gave us a rough estimate a little on the high side of $300,000 for that section. That includes curb and gutter. That could also come in cheaper as a lot of the leg work was done for Wirtz when Wirtz Way was put in. It will be like copy and paste of Wirtz Way except the elevation is different because the land is sloped. That should save us some engineering fees on that.
Even if the cost is $250,000, Mayor Johnsen thinks that the return that we are going to get off of Casey’s on property tax and sales tax, he thinks we will see our money back in five years. Casey’s average inside sales is $1.6M and over a1M 087gallons of gas, and average building cost will be $1.3M.
Casey’s will not have any cost in the road or curb which might be a trade for not requesting any redevelopment agreement. Mayor Johansen does not want to enter into anything where we pay them back for doing business here for the next 12 years, the duration of the TIF. There are a lot of those deals already that were done in the past. Alderman Stover reminded the Council that the good thing about those deals are we are not playing with our money.
Mayor Johansen had passed out some information and a map of the area with the proposed road for Casey’s. It also included a timetable of when things should begin to happen. Casey’s have about nine months before they start building and this timetable gives the City a time frame for when we should be working on the road. Farnsworth will also give budget estimates as time goes on. Casey’s will pay for the access to Wirtz Way and they do all their own sewer hook ups. Casey’s will have two approaches off of Wirtz Way and one off of Douglas Drive. Casey’s is making an investment of their own on Wirtz Way.
The dirt that Wirtz gave the City is back behind Wirtz. Casey’s will move it. The only thing Wirtz wanted was some kind of agreement with us was if a tile got damaged while they were moving the dirt that it would be repaired. It was noted that there was a tile back there that had been broken before. There is a lot of fill dirt back behind Wirtz and should be enough for Casey’s.
Once Casey’s goes in it should bring 15-20 jobs to Lexington.
To pay for this road we do have $200,000, $80,000 in the Water Fund and the remainder in TIF. At one time we had decided to pay early on the EPA Loan on the new Water Plant. The only advantage to paying down on that loan is it is going to end a year earlier at the end of the 30 years. There was $300,000 before the loan was amortized. There is no benefit now since they will not re-amortize the loan.
The question was asked about asking Casey’s to pay for the road to which Mayor Johansen replied that he had asked them. They do not want to pay for the road.
The question was asked about getting the power out that way. Mayor Johansen replied that he is meeting with them next week.
There is a grant to improve truck routes. It is called a Park Grant. Zach from Farnsworth explained that through IDOT and sometimes when you get those grants from IDOT there are so many loopholes it costs you more to get the grant than it does to put the road in.
This is what Mayor Johansen proposed to Farnsworth: Why can’t we have David Leake go in and rough cut the road in or give us a price on just doing that? We would need to have a compression test. We would go back to Hanson with that bid and say “We cannot afford to put this road in. You pay this bill, you pay to get it ready and we will do the concrete work.” I am not done working with Hanson yet.
Casey’s bought not quite five acres. The question was asked if they could be convinced to redesign to have all entrances off of Wirtz Way. Mayor Johansen did not think so as they wanted the P. J. Keller Hwy. entrance for the local residents so they do not have to go all the way up to Wirtz Way and contend with the semis coming out of those entrances. The road has already been moved over onto Casey’s property so it did not go over the sewer system. We could ask them to put two approaches off of Douglas Drive. One toward the front and one toward the back. It would mimic what is over on Wirtz Way. It might cut down on some of the traffic coming out of there. Casey’s is responsible for doing a traffic studies out there and has already started
The question was asked about the cost for the road. Would it be in next year’s budget? Mayor Johansen thought the majority would be in next year’s budget. It would depend on what the costs are if some of it would be this year. It also would depend on if we would start on the new building but Alderman Richard does not think that will happen this year. The question was asked about how far it was from the road to the property line. Mayor Johansen will need to get that answer and get back to the Council.
Discussion Old Water Plant Project:
The person doing business as Just Fine Beer is ready to move forward with his project in the old Water Plant. Mayor Johansen asked him how soon he would be ready for the building in front of the Water Plant and he is in no rush at all. It will be a year to a year and a half before he is ready to really need that. I have talked to Attorney Shields, and we can do this, I propose that we discuss some kind of lease option on the Water Plant that he can go in there and start construction now and start building his business. It is probably a two year project building the brewery with all the stuff he needs to take out of there. He is open to the idea. Attorney Shields can draw up the legal document and what needs to be included such as insurance. The only thing is that once we enter a lease with our property it becomes taxable. We would need to figure out after the first of the year what the taxes are and get enough off the lease to pay the taxes so it doesn’t cost us money. If we are not going to put a building up, the longer we wait he is going to lose interest and go someplace else and that building is just going to sit. He also wants the Morton building but not right now. When we get ready to sell that Morton building he will bid on it like everybody else. There are three parcels there. The Salt Shed, where the squad cars are parked, the Water Plant is one parcel and the Fire Station is separate parcel.
The question was asked why we cannot sell him the whole thing. The answer was we can but we need to decide how we are going to pay for a new building. Since we are not building a new building we still need the building that the squad cars in. The thought is that he can go ahead and start on the Water Plant. We lease that to him and that brick building next to it. He can start on the Water Plant and in two years by that time we should be prepared to put a new building up and then we can enter talks about him buying the parcel.
The question was asked if we had any idea what kind of lease rate we wanted for the building. The answer was no but we should keep it reasonable enough so he can put all his money in the building but we do not want to pay taxes on it. It should be a year before we see any kind of tax bill on it. Attorney Shields thought we could leave some of that open until we saw what the tax bill was or have someone estimate what the tax bill would be. Keep in mind it would cost us approximately $150,000 for us to tear the Water Plant down. He will pick up the utilities. It is either that or we tell him we are not interested and we are going to tear the building down.
Mayor Johansen will put this on the agenda for the next meeting and have Attorney Shields work on a lease agreement.
Alderman Stover wanted to know if we were certain that we absolutely could not get by without those buildings as far as storage. That we cannot find someplace else?
There was some discussion on which building the gentleman was interested in and which ones were going to be leased to him. The Water Plant has no value and that is what he is wanting to work on now. It would be much better to sell him the whole parcel but the City is not ready to put a building up and would need somewhere to store two squad cars and a mower that is in the shed. The City needs to find a place to rent to put their equipment so they can sell the parcel. Another idea would be to sell him the parcel and the City rent back the storage shed from him for a year or two.
It was decided that Mayor Johansen would talk to him again to see how he felt about it. As soon as he gets a physical address for his business he can start applying for his federal license which takes a while to get.
Old Business:
Closed Minute Review:
Alderman Richard and Alderman Stover have completed the closed minute review. The report was last done in April 2018 and nothing has changed since then. They do not feel it is appropriate to make any of the minutes from these session public at this time.
Discussion Surplus Property:
In addition to the discussion above Mayor Johansen added that one thing we can do. We have already declared that Surplus Property, we can go ahead and put it out for bids. Put out all three building up there. See what comes in and we can refuse all the bids if we don’t think it is enough. I have been talking to a guy who wants to put a gym in the old Fire Station. He has had people come and do some measuring to see how much it would cost to put in new heating and air conditioning. Mayor Johansen would much rather have retail in there. We have three pieces of property we can try to sell right now. We talked about $45,000 for the parcel with the Water Plant on it, if someone offers more, by statue we do not have to accept the highest bid. We also have the property next to Attorney Shields, we could list that.
There is four acres out by the new Water Plant but there is not room for a shed.
Committee Reports:
Mayors Report: Mayor Johansen told of another business that is very interested in coming to Lexington. They are looking at property at the North end of Wirtz Way. That was part of my talk with Hanson on that. The property tax would be great but it would not be a huge sales tax. We would see some but it would not compare to Casey’s. It would be an attraction that would bring people to Lexington.
The question was asked if Mayor Johansen had heard any more about the hotel that was interested in coming to town. He replied that that meeting had been cancelled and needed to be scheduled again. Mayor Johansen is interested in what the cost to put a hotel up would be and how much each investor would need to invest. He believes the cost of the hotel would be around $4M.
Police: None
Building/Insurance Alderman Stover is still in talks with agents getting quotes on property insurance. He still has not received the packet on the health insurance.
Finance/TIF: Alderman Stover has the EAV and in another week all of the appeals against the EAV should be complete and he should get an updated report and then he will be ready to talk about the levy.
Mayor Johansen made a suggestion that as we work on the Casey’s deal that if we will need to pay for the road, the Finance Committee get together and figure out ways that we can work all this out.
Water/Sewer/Sanitation: None
Street/Alley: None
There being no further business, motion was made by Alderman Franklin to adjourn at 8:37 p.m. Motion carried by unanimous voice vote.
https://www.lexingtonillinois.org/images/minutes10818.pdf
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