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Council authorizes up to $100 million in industrial revenue bonds for Aldi project; city says no taxpayer obligation
Summary
The council approved ordinance authorizing taxable industrial revenue bonds for an Aldi project valued at up to $100 million, with company-purchased bonds and a 12‑year 50% abatement on net new assessed value; council and staff said taxpayers bear no debt obligation and estimated a $300,000 annual net benefit to taxing districts.
The O'Fallon City Council approved legislation authorizing the issuance of taxable industrial revenue bonds for an Aldi Incorporated project, with a principal amount not to exceed $100,000,000 (Bill 77 50.1; ordinance number 7218).
Patrick McKinnon, the city’s economic development director, explained the Chapter 100 structure used to induce private capital investment: the developer purchases the bonds and the city provides a public vehicle to facilitate the financing; McKinnon said the company agreed to retain all current employees and add about 30 positions. He told the council the project grew from an initial $50 million estimate to $100 million and that higher construction and materials costs explained the change.
McKinnon and council members emphasized that the city and taxpayers will not be on the hook for the debt: "That is very correct. There is no public money spent. The company itself buys the bonds," he said. Under the agreement, the company would receive a 50 percent abatement on the net new assessed value for 12 years; staff estimated an incremental net new benefit of roughly $300,000 annually to taxing districts.
Council unanimously passed the ordinance (10-0). Staff listed follow-up tasks to secure agreements and coordinate with the assessor to determine net new assessed value and the resulting taxes distributed to school, library and other districts.
