McHenry County Blog

This morning I played photographer’s assistant on Pleasant Valley Road.

I held up the remote controlled flash.

Antonio Olivo is doing a story on things immigration, including the financing of the Lakewood SportsPlex complex with EB-5 “buy a visa” program money that is scheduled to finance the development.

Larry Larson and Al Stenstrom have been researching the financing mechanism and apparently have found something that interested the Tribune to interview them a couple of times and send a photographer to take their photo.

The photographeer had them stand near some signs on Pleasant Valley Road in front of Larson’s magnificent property.

Take a look at his back yard with a dammed up Laughing Creek running through a pond.

He has a covered bridge over one part of the water.

No wonder neighbors to the proposal have signs in front of their homes.

The group even lists how each county board member voted on its web site, “Stop the McHenry County SportsPlex.”

There’s a page addressed to Lakewood residents.

The Tribune photographer was off to the McHenry County Jail to take pictures of the cell blocks were illegal immigrants are housed.

Below is the emailed letter that Lakewood Village Trustee Ken Santowski sent concerning Tuesday’s meeting which resulted in the approval of annexation of additional property to the village, plus economic incentives to the McHenry County SportsPlex.

The SportsPlex is probably the biggest building project other than schools and hospital additions that have been seen in years.

I find the following conclusion of interest:

“…the village would only lose face if the project fails…”

Friends:

As you may have seen in the newspaper this meeting of 07/27/10 was devoted entirely to the SportsPlex.

Several key “things” had to happen before the MCS (McHenry County SportsPlex) could go forward in Lakewood.

There was a planning and zoning hearing to recommend annexing some other properties into the village so some infrastructure changes could be made. Those changes were presented as something good for the complex and those changes would only enhance the potential benefits of the complex to its neighbors and residents of Lakewood.

Over the previous couple of days I received a couple of calls (3 to be exact) from residents NOT living in Lakewood expressing their desire to have me vote against the MCS.

At first I was leery of their phone calls, but after listening to them I determined that some of their reasons for wanting to reject the complex were legitimate.

The #1 reason that I ascertained from those calls was that the complex would encroach upon their lives and severely impact their quiet existence.

Also that the MCS people had not contacted most of the non-Lakewood residents about how the complex would affect them.

Since I am not a member of the plan and zoning board, I sat in the audience like everyone else.

There were  many consultants and experts ready to speak on behalf of the project. The presentation went well.

Members of the audience were allowed to cross-examine those experts, voice concerns and eventually give their opinion’s. Several key objections were raised during this first meeting. All were dignified and sincere.

The village board meeting started after a short 15 minute break.

Once again the experts presented their case, members of the audience were allowed to cross-examine them, ask questions and give opinion’s.

While some pleas against the complex were based on the simple desire to ward off progress, again many major concerns were raised.

From my viewpoint it appeared that the complex has 3 major hurdles.

• Completion of studies showing the feasibility of the potential success of the project based on other similar projects;
• water and sewer supply and discharge, and
• traffic.

It appeared that several members of the audience had found a way to get under the skin of a couple of consultants. The consultants did not have the answers to questions, either because their study was not complete or their study did not encompass the residents questions.

The ability to have water and sewer on site seemed to be a rather large issue.

As of last night, the complex did not have a clear answer as to who and how water and sewer were being brought to the site. The other part of the question was as to the financial aspects of paying for that water and sewer rights.

Extensive traffic studies were done regarding the complex.

Unfortunately the traffic study did not include areas to the far west and far south side of the complex. It was in the engineers  opinion that those areas did not need to be studied since the current amount of flow through traffic represented only a very small % of the potential traffic survey.

I agree with those residents who raised these concerns. While the project looks good and seems to be a viable addition to the village, I had hoped that the MCS people had been more “neighborhood friendly” especially with those who do not live in Lakewood, but will have

• ball fields,
• parking lots and
• other “structures”

outside their windows and across the street.

During the meeting, I asked Jack Porter to make sure that he  does in fact talk to every single person directly affected by this potential development.

He said he would try.

Though these objections were raised it was not enough to dissuade the board (or myself) from stalling this project.

There are many larger and more legally challenging concerns that need to be taken care of by the developers before this project can move even on handful of dirt.

It was my belief that the business model they would be presenting to potential investors would be the stumbling block they most need to be aware of.

I felt that my giving them a “yes” vote it would be up to them to complete and answer those residential and non residential concerns and objections.

This project is far from being a done deal.

Many more meetings, plans, details, discussions (and Votes) will be needed before the first construction vehicle shows up.

Since their is no liability against the village if the project fails, I felt it best to let them proceed.

While we are making some concessions, deals, grant writing and revenue sharing the village would only lose face if the project fails.

While we are waiving a potential significant amount of fees, we would have done the same for any potential developer within the village’s limits.

Staff has spent time (a lot of time) researching the ways and means to accomplish the agreements made in the shortest period of time. While it is true that I have not been a huge supporter of certain staff members, I have to believe their efforts are put forth with the best of intentions.

I like the look and feel of this complex.

It meets all of the criteria that most towns would love to impose upon a development, but would not take the risk of asking.

Do I believe this complex will be successful?

It matters what you(r) level of success is at.

I do not think they will be able to obtain the eventual number of visitors each day/year without having serious growth pains and complaints.

However, if they only meet their number by 50% I believe the project could be sustainable long enough to ride out the horrendous economy, and still appease those who live nearby and those who would use the complex.

After the meeting ending I expressed my concerns of the developer being a “good neighbor” to ALL of our neighbors; even if they do not live here.

I explained to him that I would be checking with each and every property owner in the area to make sure he (Jack Porter) or his staff talks to them.

He seemed to take me seriously.

I shall keep my eyes, ears and mind open for ANY news, developments or even rumors regarding this complex.

Kenneth M Santowski

The Lakewood village board unanimously approved economic incentive and annexation ordinances that allow the $40 million, 165 acre McHenry County SportsPlex to proceed.

The result is three happy guys, Lou Tenor, EnRico Heirman and Jack Porter, plus a plethora of consultants who pretty much answered every question thrown at them.

A zoning hearing started at 6 at the Lakewood-owned Red Tail Golf Club with over 120 people in attendance at its peak.  Less than half that number lasted until the midnight hour when about ten minutes of voting approved all the paperwork.

Besides the consultants, village officials and staff, most in attendance were people objecting from the neighborhood.

Lakewood, trying to garner more revenue, has moved aggressively in the last two months to annex property along the western side of Route 47 up to the northern leg of Route 176.

Adjoining property owners are not happy.  That includes those who will be living next to baseball fields, plus those south of the area in unincorporated Colleens Cote.

Subdivision board member Peggy Keegan put it this way,

“You’re putting a ghastly complex in the middle of a corn field.  If it doesn’t succeed, you have a Motorola, you have a Sears Complex.”

“We feel all of this was done behind our backs,” Tom Balboney, also a resident from the subdivision, said.

An earlier supporter of the project had talked of his father’s having pointed to where Woodfield would be built.

Balboney said that’s why he had moved out here, to get away from places like Woodfield.

“We all feel this was done behind our backs,” he concluded.

Earlier Colleen’s Cote resident Catherine Francis had accurately observed,

Colleens Cote's Kathryn Francis told of the Blandings Turtle and blue birds she had on her property south of the property being annexed for ball fields.

“This feels to the residents as a moving train.  Suddenly you are in our back yard.  Venues could come in that would invite people that we wouldn’t want.  There has been no discussion about our safety.

“Are you telling us you want to do this to us for a half a million a year (in new revenue to Lakewood)?”

Village President Erin Smith told neighbors that their concerns would be taken into consideration.  Concerns included traffic on Hamilton and Pleasant Valley Roads, noise and light pollution.

It took two hours for the project’s consultants, choreographed by attorney Tom Zanck, to finish their testimony.

Traffic Engineer David Miller explained the new intersection that will result once Pleasant Valley Road is relocated south so it is opposite the south leg of Route 176.

No longer will motorists see a sign that asks, “got mulch?”

Once completed, there will be an elaborate entryway.

There will be ball fields all over the place.

A selling point to the proposal was its environmentally sensitive design by Jack Porter, who developed the Sanctuary of Bull Valley in the City of Woodstock.  High quality wet lands like Lighting Creek are being completely avoided.  The cold water creek, which contains the Iowa darter, a little perch, will be crossed by a boardwalk.

The boardwalk will be part of a trail system that will be available to the general public.  The

developers will charge those participating in tournaments, but don’t plan to do the same for family, friends, coaches, etc.

Porter touted the development as “an opportunity to stimulate the Northwest Quarter of the village.”

He described it as “a public-private partnership” that would never have happened without the support of Dick Durbin, Melissa Bean, Pam Althoff and the village board.

500 construction jobs will be created and under terms of the EB-5 financing, which, as former village president candidate John O’Hara put it,

“We’re selling visas to foreign residents.”

The Federally-approved financing device allows foreigners to invest $500,000 in a project like the SportsPlex and get a visa, as long as enough jobs are created.  For the amount of money involved, there must be 353 Full-Time Equivalent jobs created.

O’Hara summarized the financial arrangement like this:

“So, there’s no taxpayer risk for the EB-5 bonds, no taxpayer risk for the Recovery Zone Bonds.

“So, the only risk for the taxpayers is the off-site improvements.”

Village President Smith replied, “That’s right.”

The $18 million in county board-approved Federal stimulus bonds is being used “only as a start-up mechanism.”

It was also described as “a bridge loan.”

The off-site improvements include a promise by the village board to provide sewer and water to the property.  Current Lakewood sewer and water lines are about two miles away, so it may be cheaper to build on-site treatment and water facilities.

“The village has made a commitment to provide sewer and water,” Village Administrator Catherine Peterson explained.

A man asked why the SportsPlex was not being built on the east side of Route 47.

Porter replied there were three reasons:

• “the availability of land (on the west side of the road)”
• “it’s in the center of the county”
• “it would be in the village of Crystal Lake (if it were on the east side of Rt. 47)”

Financial information for the private enterprise was not revealed.

Stressed several times was

“This is all equity financing.”

Eventually, $36 million is being sought from E-5 financing, while $4 million in equity is being sought elsewhere.

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More illustrations here.

You will remember that details about the McHenry County SportsPlex have been dribbling out a little bit at a time. Some residents have been upset enough to distribute a broadside, which I publishes here. (We found it after coming back from a visit to Independence Hall in Philadelphia and Thomas Jefferson’s plantation of Monticello. What appropriate timing.)

I noticed that signs have been prepared as well, but I have only seen this one on Route 47.

As one who has watched public police roll-outs for decades, it seems to me the village should have been done two newsletters ago.

So far, no mention of the SportsPlex has been made in any official publication to residents/taxpayers. Really strange.

I’ll be reading this explanation of the Village official’s viewpoint as I am posting it this Monday morning.

Before I start, I can tell you I want to know who has how much money invested in the SportsPlex and ownership interest in this project, if any of my money as a Lakewood property owner is at risk.  [I've now read the part where the financing for the golf course that cost residents $500 a year for the better part of a decade is said to be nothing like that of the SportsPlex.]

The county board didn’t care to make that public, if anyone knows, even though the Federal stimulus package is involved.

I do not want Lakewood to end up owning a huge building, if the promoters are unsuccessful, so if that is part of the backup plan, something like a demolition bond ought to be included.

First is a cover letter from Village President Erin Smith, who now has enough allies on the board to do anything she can convince them of.

July 14, 2010

Dear Residents:

Erin Smith

During the past several months, there has been some discussion about a sports complex within the vicinity of Illinois Routes 47 and 176.

This includes land that was recently annexed into our community. While no formal proposal has yet been submitted, the Board of Trustees and I believe it is now appropriate to address some of the most frequently asked questions we’ve heard.

I have enclosed a document that provides a summary of the most frequently asked questions. As new questions are received, we will update this document and post an updated version on our Village website at: http://village.lakewood.il.us

We anticipate that the sports complex will be considered at our meeting on July 27, beginning at 6:00 p.m. [no location indicated, but the golf course club house where regular meetings are held, it seems to me, is way too small], and I urge residents to attend the meeting and learn more about this proposal. As always, I encourage you to contact me directly at erin.smith.lakewood@gmail.com or (815) 356-8005 with any questions or concerns regarding this matter.

Sincerely,

Erin Smith, President
Village of Lakewood

Lakewood Sports Complex Frequently Asked Questions

Updated Last on July 9, 2010

1. What is the sports complex and where will it be located?

While no formal submittal has yet been made, we believe that the sports complex will include about 160 acres of land that consists primarily of outdoor sports fields for baseball, softball, and soccer. There will also be an indoor facility of approximately 125,000 to 150,000 square feet. It will include basketball and volleyball courts as well as a restaurant and retail space.

There is also a five (5) acre outlot that is proposed to be developed as a gas station/retail complex.

The exact location of the complex has not been finalized, but it will likely be located on the west side of Route 47, south of the northwest leg of Route 176. The gas station and retail complex will likely be closest to Route 47, with sports fields extending west along Pleasant Valley Road. More information regarding the land and location of buildings and fields will not be available until we see the first formal proposal for a planned unit development (PUD).

2. Will my taxes be raised if the sports complex fails?

It is essential for our residents to understand that the Village of Lakewood will have no responsibility or liability for payments if the sports complex fails.

While references are being made to the Sears Centre or Libertyville Sports Complex, these comparisons are not relevant.

In both of these instances, the facilities were financed using General Obligation or Alternate Revenue Bonds, which require that property taxes are pledged as a revenue source if the enterprise revenues do not cover the debt payment.

This financing model has never been considered for the proposed sports complex in our community. The sports complex financing is entirely private.

3. Is it possible that our taxes will be raised as they were to pay for RedTail Golf Course?

In order to maintain open space and support property values throughout the community, the Village of Lakewood made a decision to purchase and operate RedTail Golf Course using Alternate Revenue Bonds. As the owner, the community is ultimately responsible for the payment of debt if the operating profit cannot cover this obligation. The final payment for RedTail Golf Course will be made in 2011. As stated earlier, the Village of Lakewood will not own, operate, or be responsible for any payment relative to the proposed sports complex.

4. Will there be any economic incentives for the developer?

As all of our residents know, residential and commercial development is at a virtual standstill throughout our country, and it requires creativity and partnerships in order for projects to move forward.

As is often the case when communities are negotiating with commercial developers, we are discussing both a waiver of certain fees we would normally charge for development and a formula for sharing revenues produced by the development.

These are revenues that would otherwise not be available for our community, including:

• sales taxes,
• parking fees,
• entertainment taxes, etc.

We are also willing to partner with the developer to seek grant funding for infrastructure or unique environmental aspects of the project.

No cash contribution from the Village of Lakewood is being considered.

5. Are there any other risks to the Village of Lakewood related to this project?

The Village Staff has and will continue to invest a significant amount of time and resources to supporting the development phase of this project. There is certainly an opportunity cost associated with this time investment, as residents may find that there are days when there is a delay in responding to non-urgent resident requests. We believe that this time investment is worthwhile in the end, as commercial development at this major intersection is essential to maintaining essential services and public infrastructure without a future increase in property taxes.

A second risk is that the project will fail, leaving a vacant building and land behind. This is land that could easily be redeveloped by another land owner in the future. We believe this is an unlikely scenario, as the business plan for the sports complex has been vetted by several independent consultants and financial institutions, including Stern Brothers.

6. Did McHenry County contribute $15 million in financing to this project?

McHenry County received $27.5 million in federal bonding authority for private projects under the $789 billion American Reinvestment and Recovery Act.

The bonds are meant to encourage lending for shove-ready projects by giving investors a 45 percent refund of the federal taxes payable on them.

The McHenry County Board chose to dedicate $18 million of its allocation for this project.

Private investors will choose of their own volition to purchase these bonds, and McHenry County will have no obligation or responsibility for repayment.

7. Has there been an investment of foreign funds into this project?

Another funding source will come from a federal financing program called employment based fifth preference, or EB-5.

The program, created in 1990, offers permanent resident status to foreign investors who fund businesses that create or save jobs.

It is simply a unique investment tool that the developers have identified to help fund their project, and the use of EB-5 funds for this project has no bearing on the deliberations by the Village of Lakewood.

8. What benefit is there for the Village of Lakewood?

The recent annexation of about 565 acres of land was consistent with our boundary agreements with neighboring communities, our Comprehensive Plan, and our Facility Planning Area.

It brought four (4) existing businesses into our community and will help to grow and diversify our limited sales tax base.

The proposed sports complex is also consistent with these underlying documents and has the potential to significantly increase our General Fund revenues. It is also likely that ancillary projects (i.e. restaurants and retail) will develop to support the sports complex.

Finally, the proposed sports complex will be built incorporating best environmental management practices and provide a template for sustainable development within our community.

Not only will it generate new sources of revenue which are essential to our long term sustainability, but it does so by creating a destination that is consistent with our vision for our community.

9. How can I learn more about the proposal?

We anticipate that the proposal will be considered at our meeting on July 27, beginning at 6:00 p.m.

10. Should I be concerned with the statements that were included on a flyer that was placed in my mailbox recently?

Since the flyer was sent anonymously, it’s not possible for us to follow up with the person(s) who have expressed these concerns. Nor is it possible to understand the basis of their misinformation.

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Previous articles that might be of interest:

$18 Million Federal Stimulus Request for $40 Million Route 47 & 176 Lakewood Recreational Complex on County Board Finance Committee’s Agenda Tuesday

Concept Drawings of the Proposed McHenry County Sportsplex in Lakewood

May Letter Outlines $5 Million in Direct and Indirect Lakewood Financial Assistance to Sportsplex Developer Lou Tenore

So, You Want to Know More about the Lakewood SportsPlex?

Lakewood Village President Erin Smith Endorses Ken Koehler for County Board

First Electric Newspaper Finds Potential Snag in Lakewood SportsPlex

Chicagoland Foreign Investment Group Sends SportsPlex Investment Letter

Investment Bank Announces Commitment to SportsPlex, If

Thoughts on “Money in the Bank”

Lakewood SportsPlex Proposal Getting Curiouser and Curiouser

Lakewood Gains New Economic Development Tool

Lakewood Seeks to Annex 540 Acres, including Route 176 & 47 Golf Courses & SportsPlex Site

Judge Michael Caldwell Gives Lakewood Green Light to Grow to Route 176

Former Village President, Republican Activist Win Lakewood Trustee Spots

Big Zoning Doings in Lakewood Tuesday Night

Lakewood Annexes Past Route 47 Up to Route 176

Village of Lakewood Summer Newsletter, Anti-SportsPlex Flyer Arrive

The summer letter from Lakewood Village President Erin Smith has arrived and I share it at the bottom of this article.

Missing from this second newsletter since the possibility of a SportsPlex near the intersection of Routes 47 and 176 was raised is any mention of the proposal.

I could find no information whatsoever.  And there was plenty of room to put it.

When we got back from vacation, however, I did find this flyer opposing the idea in with my accumulated copies of the Chicago Tribune and Sun-Times:

Given the fact that first impressions are quite important in public relations, I cannot understand why official village publications have ignored the issue, which certainly appears to be controversial.

The flyer, whose content I have tried to reproduce below, but for whose accuracy I do not vouch, says,

NO Lakewood Sportsplex

Did you know Lakewood residents:

• Will pay to develop Pleasant Valley Road.
• Will pay to bring water and sewer to the area.
• Will pay taxes to support the Sportsplex if it fails.
• Will pay for increased village services needed–police, fire, etc.
• Lakewood could be stuck with a 125,000 sq. ft. building to support.

Village of Lakewood told residents they would never have to support the golf course.  GUESS WHAT?  You, the residents, are supporting the golf course through increased taxes.

DID YOU KNOW…

• Location of the SportsPlex was given  incorrectly to the county board when they applied for the American Recovery and Reinvestment Act.  Location is actually on Pleasant Valley Road, a small residential area that is not designed to handle 600,000 people.
• Developer claims 600,000 people annually would visit the site.  From where would they come?
• $18 million of our taxpayers money is going to build this Sportsplex.
• $27 million will be sought from foreign investors.
• Foreign investors can buy a VISA that grants permanent U.S. residency to those who invest in this Sportsplex and after five years can apply for citizenship.
• People behind the Sportsplex are NOT investing any of their own equity in the project, but stand to make BIG money from this project.

$5,000,000.00 is being offered by YOUR VILLAGE LEADERS.

Remember our Lakewood Pool?

Contact your village council representatives to say NO to a Lakewood Sportsplex!

Check out First Electric Newspaper.  Search for Lakewood Sportsplex.

I think you will agree that many Lakewood residents would have questions after reading the broadside above.

Village President Erin Smith’s letter follows:

Dear Neighbors,

In this edition of our newsletter, I am pleased to share with you many positive developments within our community during the past few months.

Primary among these is the annexation of 565 acres of new property into the Village of Lakewood.

This action was approved unanimously by the Board of Trustees at our meeting on June 8 and is consistent with both our signed boundary agreements with neighboring communities and our Comprehensive Plan.  In general, the annexation follows

• the north side of Ballard Road west from the existing Autumn Ridge Subdivision;
• north along both sides of Illinois Route 47; and
• southwest along the northern leg of Illinois Route 176.

Our northwest boundary will now be the southeast intersection of Illinois Route 176 and Dean Street.

In addition to providing for future retail/commercial growth, the annexation brings four (4) existing businesses into our community, thereby nearly doubling our existing commercial
base. These businesses are

• Crystal Woods Golf Course,
• Craig Woods Golf Course,
• The Gardens of Woodstock, and
• Kolze’s Garden Center.

We are also happy to welcome Yuppy Puppy Dog Grooming and More to Lakewood Commons.

I strongly encourage you to visit the newest members of our business community and to welcome them. While I know that it’s sometimes difficult to change shopping habits, it is important to support all of our local businesses so that they thrive and your sales tax dollars stay in the Village of Lakewood to support our services.

AAA Bond Rating

As a part of issuing bonds for the construction of a new water tower, the Village of Lakewood requested that Standard and Poor’s issue a rating. Upon review of our information, I am very pleased to report that we have been assigned a rating of AAA, which is the highest rating possible. It has been determined that the outlook for this rating is stable. The rating was based in large part on Standard and Poor’s opinion of the Village of Lakewood’s:

• Participation in the deep and diverse Chicago metropolitan economy;
• Very strong reserves with balanced general fund operations, supported by good financial management;
• Very strong income and extremely strong market per capita levels; and
• Moderate debt burden.

This analysis and rating represents many years of prudent financial management by both the elected officials and staff. Not only does it allow the Village of Lakewood to issue debt at lower costs, but it is also a strong signal to potential investors that the Village of Lakewood is a strong and stable community in which to do business.

New Trustees and Committee Members

Trustees John and Dorothy Pfeuffer resigned from the Village Board following 3 and 5 years of service respectively, as they sold their home and moved from the Village. John and Dorothy both contributed many hours of service to the Village outside of meetings. I am especially appreciative of their roles in supporting the SSA-1 Lakes Committee and the Parks and Recreation Committee.

I am very pleased to announce that the vacancies left by John and Dorothy have been filled by former Village President Julie Richardson and former County Board Member Blake Hobson. Julie and Blake bring considerable experience to our Board at a very important time in our history. Both Julie and Blake were appointed just shortly before we formalized the recent annexations.

The appointment of Julie and Blake to our Board created two vacancies on our Economic Development Committee. In addition to these vacancies, we had a vacancy on the SSA-1 Lakes Committee. I am pleased to announce that Donald Miller and Gary Sexson have been appointed to the Economic Development Committee and that Christopher Fox has been appointed to the SSA-1 Lakes Committee.

Comcast Spotlight on Lakewood

If you are a Comcast cable customer, you may see me on Comcast Newsmakers throughout the last week in July. Comcast provides an opportunity for local officials to talk for 5 minutes about their community in a live interview. We will also load the short video on our Village website.

Pizza with the President

It’s time for my quarterly neighborhood meeting which will be held on Thursday, July 22 at 6:30 p.m. It will be held at the home of Rosalie and James Schraut, 9045 Underhill Court. I appreciate the opportunity to meet with neighbors in an informal environment. The meetings to date have provided a wonderful opportunity to discuss Village-wide and neighborhood-specific issues. Lou Malnati’s provides the pizza for the evening. Please call me if you are interested in hosting a future event.

Sincerely,

Erin

When asked about when the village would let residents know about the SportsPlex, Smith emailed me that there would be a special newsletter dedicated to that subject this month or next.