Shopping centers, like the clothing in their stores, must keep up with fashion or get swept aside as hopelessly out of date. Yet in this era of tight credit, it's pretty much impossible for a shopping center to borrow the money needed to spruce up.
That's the essence of what Mike Williams, the general manager of Golf Mill Shopping Center, told the Niles village board at its meeting Tuesday night during an initial discussion of a proposal that would, in effect, have the village slightly raise sales taxes at the mall to fund infrastructure improvements that will allow it to renovate and stay competitive in the future.
"We're seeking your support," he told trustees, ticking off some of the troubles the mall is facing: below-market leasing deals, bankruptcies, tight bank financing, and competition in the form of proposed malls in Rosemont and Norridge.
Village Manager George Van Geem told trustees he has been working with the mall's management for months to develop a plan, because of the mall's importance in providing sales tax revenue to the village.
Williams drove home the benefits to Niles residents, saying that for every dollar spent at Golf Mill, 67 cents comes from non-Niles residents, while 33 cents comes from Niles residents.
Wendell Hollan, first vice president of brokerage services for CB Richard Ellis, the leasing agent for Golf Mill, and Bob Rychlicki of Kane McKenna and Associates, a financial services consultant which works with municipalities and economic development, also told trustees of the need to make improvements and updates at the mall and the fact that banks would not provide the loans to make such renovation possible.
According to a notice prepared by the village, the plan calls for the village to declare Golf Mill a "blighted area" in legal language, for the purposes of making it eligible to become a business district under the provisions of a state law, called the Business District Act. That law allows municipalities to enact a tax on the businesses there to, in effect, help them.
Under the plan, according to the village's notice, Niles would levy on Golf Mill tenants a tax of 0.25 percent, or 25 cents on a $100 purchase, according to Rychlicki. The money would finance the mall's improvements, which could include: water mains, sewer mains, sidewalks and roadways, site preparation, building rehabilitation and related professional costs.
Trustees voted to move the proposal along by scheduling a public hearing, which will most likely take place Sept. 13 or 20.
After the meeting, Trustee Andrew Przybylo remarked, "It's a smart move for the mall. They don't have the wherewithal to make the improvements that have to be made, so they have to do it in some other way."
The village would not be on the hook for any money, he pointed out.
"But will shoppers get wise, and realize there's a one-quarter percent sales tax?" he asked rhetorically.