Board approves amendment to Montgomery Development Fund after debate over prevailing wage and reimbursement terms

The Village of Montgomery Board of Trustees on July 28 approved Resolution 2025-021, amending the Montgomery Development Fund program. The board voted 6–0 to adopt the changes after a detailed discussion about prevailing-wage requirements, program structure and application review.

Village attorney Attorney Kwan told trustees that accepting public funds for a project generally triggers prevailing-wage requirements: "if you accept a dollar of state funding or in this case, municipal funding, it makes the whole thing prevailing wage," she said, explaining why partial funding or sequencing matters when private contractors and public-funded portions work on the same site.

Kwan and others told the board that one possible approach is sequencing contracts or issuing separate requests for proposals so that work that is not covered by public funds does not take place concurrently with prevailing-wage work. She said the village can approve funding for a subset of a project (for example lighting) but noted the village would have limited control over the remainder of the privately funded work once the public portion is completed.

Manager Burke and staff described three program tracks in the amended documents: (1) a forgivable/reimbursement-style commercial improvement program (formerly a facade program) that includes eligibility criteria and an award structure, (2) a downtown restaurant-focused reimbursement tied to certificate of occupancy, and (3) a low-interest loan program for larger needs. Burke said the low-interest program will be reviewed by the Montgomery Development Fund Committee and that the facade-style forgivable awards for new businesses include a business-plan review by Waubonsee Community College's Small Business Development Center.

Trustees asked for clarity on timing and paperwork. Burke said the village issues written notification after approval and reiterated that applicants must apply before starting work; some limited reimbursement eligibility exists for work completed up to six months prior under older program provisions carried forward. He described the documents as containing a "clawback" or pay-back provision if businesses do not meet the continued-operation requirements tied to forgivable awards.

Several trustees expressed concern about the impact of prevailing-wage requirements on small contractors and whether the prevailing-wage differential could make projects financially unattractive. Attorney Kwan said vendors familiar with public projects suggested sequencing work or separating components to reduce overlap where feasible, but she cautioned that mixing public-funded and non-public-funded work on the same jobsite at the same time generally requires prevailing wage.

The board approved the resolution by voice/roll call after a motion by Trustee Maraszek and a second by Trustee Youngerman; the vote was unanimous.