Council Reviews Redevelopment Agreement for Banks Oil; Resident Urges Pause Over Downtown Impact

A draft redevelopment agreement with Banks Oil was put before the Streator City Council for discussion, outlining a reimbursement program for up to $2,570,000 in eligible expenses and a projected private investment of $11,000,000.

City staff told the council the plan would not require upfront city funds. Instead, reimbursement would be made "by taking the taxes that they pay" and returning 85% of those incremental tax receipts to the developer until the $2,570,000 cap is reached. Staff said the assessor estimates the completed site could generate about $150,000 in annual tax assessment increment; at that level, staff projected the reimbursement period could run about four to five years under the TIF-like structure.

A resident identified in the meeting as Mr. Phelan asked the council to "pause and articulate to all of us clearly and publicly why this deal in this location with this level of public subsidy is the best choice for people of Streator," saying the proposal would "forever gonna change the city" and would demolish historic structures in the downtown area. He urged the council to explain how the project fits with the city's adopted comprehensive and downtown strategic plans, which he said call for preserving historic character, encouraging mixed-use development and enhancing pedestrian connections.

Staff described several points of the current draft agreement: reimbursement will be "pay as you go" and based only on the taxes generated by the property; demolition costs at the site are estimated at "over a million dollars" and are included among the claimed eligible expenses; the agreement includes a requirement that a commercial drive-through car wash be built on the site as an amenity; and in the event of default, repayment language applies to subsidies paid to that point. Staff also said the draft was adjusted to clarify that an "act of God" event (for example, tornado damage) would not automatically trigger default if reconstruction took longer than 90 days.

Staff said the developer's attorney requested clarification to avoid a default where reconstruction after a catastrophic event would take longer than the 90-day default window. Staff confirmed the agreement would require the developer to document all eligible expenses in order to be reimbursed, and consultant or TIF-creation costs paid by the city would be recovered first from any reimbursements.

Council members and members of the public discussed alternatives for the historic church on the site, noting the diocese's 2010 report had previously estimated $1.2 million for repairs at that time. Councilmembers and residents said subsequent inspection showed continued deterioration and that proposals to reuse the church became cost-prohibitive when demolition or repair costs were measured.

No formal vote on the Banks Oil redevelopment agreement was recorded at this meeting. Staff said, if the agreement proceeds, demolition was expected to occur this winter. Council indicated the site plan and any landscaping will return for plan commission and council review before final approval.

Provenance: First related transcript line: "So I come here tonight ... You're being asked to approve development and a tax incentive package that's forever gonna change the city." (Public comment, 00:00:52) Last related transcript line: Staff: "They said demolition this winter. This winter, demolition." (Project timeline discussion, 00:23:29)

Sources: Meeting transcript blocks starting 00:00:52 through 00:23:29.