PEORIA — After weeks of public discussion, there was little debate Tuesday night as City Council members approved an added sales tax to help bring a Portillo's restaurant to the city.
Councilors supported the additional 1 percent sales tax and the creation of a special service area on an 8-2 vote, with Mayor Jim Ardis and 5th District Councilman Denis Cyr opposed.
"By having a Portillo's in our area, we will help businesses in our area," 4th District Councilman Jim Montelongo said, arguing, essentially, that a rising tide lifts all boats.
He detailed the prospect of $50,000 in additional real estate taxes per year in the community and, based on staff projections, up to $85,500 in new sales tax revenue for the city — not transferred revenue from customers shifting from other businesses in town — among benefits to taxpayers.
Moreover, for At-Large Councilman Zach Oyler, the fact that the city will have no money on the hook for incentives was appealing.
"Many of the incentives that have been used in the past have tied city of Peoria money into them," he said, acknowledging that some have lost taxpayers money. "If (Portillo's) doesn't make it, we are not making bond payments, we are not trying to shore up accounts we're paying money out of."
Oyler also praised city officials and developer William Torchia for compromising, reducing the proposal from a 30-year life, capping the amount Torchia can receive at $650,000, and ensuring that if the parcel is sold the tax goes away.
Late last month, amid public debate and signals from council members that the votes weren't there for the more extensive proposal, Torchia attempted to withdraw his request and returned to the negotiating table with the city.
For Cyr, his opposition was based on the amount of money shifting from other businesses — some 70 percent of Portillo's revenue based on city estimates that assistant city manager Chris Setti conceded amounted to no more than a best-guess projection.
Cyr said that amount on a middle-range sales projection of $6 million a year would take away $4.2 million in revenues from mom-and-pop stores in Peoria.
"What people are complaining to me about is that we're looking at possibly giving a developer $650,000 to compete against possibly $85 million" of loss to local businesses over 30 years, he said, noting that the only calls he had received were in opposition to the proposal.
The 1 percent sales tax will last for no longer than 15 years — and is projected to last only 11 based on revenue estimates — to help Torchia recoup some of his costs for acquiring the properties for the deal.
No citizens spoke during a public hearing at the start of the meeting about the proposal.
At-Large Councilman Sid Ruckriegel, one of the most vocal opponents of the special service area tax proposal, was absent from the meeting.
A request for nearby Westlake Shopping Center — increasing the sales tax from three-quarters of a percent to 1 percent in its separate special service area — was deferred by councilors until the council's Dec. 12 meeting.
Chris Kaergard covers politics and government. He can be reached at firstname.lastname@example.org or 686-3255. Follow him on Twitter @ChrisKaergard.