Ordinance 2011-64 Ordinance No. 2011-6- 1
ORDINANCE APPROVING ECONOMIC INCENTIVE AGREEMENT
BETWEEN THE UNITED CITY OF YORKVILLE AND BOOMBAH
WHEREAS, the United City of Yorkville, Kendall County, Illinois, is a non-home-rule
municipality pursuant to the Illinois Municipal Code and Article VII, Section 7 of the
Constitution of the State of Illinois of 1970; and,
WHEREAS, Boombah is in the business of manufacturing customized sports apparel,
footwear, uniforms and accessories and is currently located in Morris, Illinois, and has
approached the City to propose that it acquire property in the City located west of Route 47,
north of Cannonball Trail on Wheaton Avenue and relocate its distribution center to this location
on the condition that the City provides certain incentives in order to induce it to proceed with this
major undertaking; and,
WHEREAS, Boombah has also advised the City that it intends to invest in the
redevelopment of the City's "downtown district" on the condition that the City itself continues to
invest in the redevelopment of this area through the use of incremental real estate taxes available
as a result of the City's designation of the Downtown Yorkville Redevelopment Project Area
(the "Redevelopment Project Area" or "Downtown District") pursuant to the Tax Increment
Allocation Redevelopment Act (65 ILCS 5/11-74.4-1 et seq.) (the "TIFAct"); and,
WHEREAS, the Mayor and City Council of the City have reviewed the qualifications
and business operation of Boombah and have concluded that Boombah's proposed investment in
the Downtown District and Boombah's relocation of its distribution center to the City would
substantially increase job opportunities for the citizens of the City and provide for economic
development thereby enhancing the tax base of the City and the other taxing districts and add to
1
the wealth and prosperity of the City and its citizens; and, pursuant to the Illinois Municipal
Code, 65 ILCS 511-1-1, et seq., is prepared to enter into an economic incentive agreement with
the terms, requirements and conditions as set forth in the Economic Incentive Agreement
attached to this Ordinance.
NOW, THEREFORE, BE IT ORDAINED by the Mayor and City Council of the
United City of Yorkville, Kendall County, Illinois as follows:
Section 1. The Economic Incentive Agreement by and between the United City of
Yorkville and Boombah in the form attached to this Ordinance is hereby approved and the
Mayor and City Clerk are hereby authorized to execute and undertake any and all actions and
deemed necessary to implement its terms.
Section 2. This Ordinance shall be in full force and effect immediately upon its passage
by the Mayor and City Council and approval as provided by law.
United City of Yorkville, Kendall County, Illinois, this (f day of 0(/ > A.D.
2011.
� l
CHRIS FUNKHOUSER �_ GEORGE T. GILSON, JR.
\� �-
CARLO COLOSIMO DIANE TEELING
JACKIE MILSCHEWSKI MARTY MUNNS
ROSE SPEARS LARRY KOT
APPROVED by me, as Mayor of the United City of Yorkville, Kendall County, Illinois, this
30 day of Q��lr1d�� , A.D. 2011.
r
Mayor
Attest: 1
City Cler c
2
ECONOMIC INCENTIVE AGREEMENT
BETWEEN THE UNITED CITY OF YORKVILLE AND BOOMBAH
THIS ECONOMIC INCENTIVE AGREEMENT dated as of the Lr day of
2011, by and between the United City of Yorkville, Kendall County, Illinois, a
municipal corporation (hereafter the"City") and Boombah (hereafter"Boombah").
WITNESSETH:
WHEREAS, the City is a non-home-rule municipality pursuant to the Illinois Municipal
Code and Article V11, Section 7 of the Constitution of the State of Illinois of 1970; and,
WHEREAS, Boombah is in the business of manufacturing customized sports apparel,
footwear, uniforms and accessories and is currently located in Morris, Illinois; and,
WHEREAS, Boombah has approached the City to propose that it acquire property in the
City located west of Route 47, north of Cannonball Trail on Wheaton Avenue (the "Subject
Property") and relocate its distribution facility to this location on the condition that the City
provides certain incentives in order to induce it to proceed with this major undertaking; and,
WHEREAS, Boombah has also advised the City that it intends to invest in the
redevelopment of the City's "downtown district" on the condition that the City itself continues to
invest in the redevelopment of this area through the use of incremental real estate taxes available
for such purpose as a result of the City's designation of the "downtown district" as the
Downtown Yorkville Redevelopment Project Area (the "Redevelopment Project Area" or
"Downtown District") pursuant to the Tax Increment Allocation Redevelopment Act (65 ILCS
5/11-74.4-1 et seq.) (the "TIF Act") and the adoption of a Redevelopment Plan and Project for
this Redevelopment Project Area (the "Redevelopment Plan") and the TIF Act as applicable to
this Redevelopment Project Area; and,
1
WHEREAS, the Mayor and City Council of the City (the "Corporate Authorities") have
reviewed the qualifications and business operation of Boombah and have concluded that
Boombah's proposed investment in the Downtown District and Boombah's relocation of its
business operation to the City would substantially increase job opportunities for the citizens of
the City and provide for economic development thereby enhancing the tax base of the City and
the other taxing districts, and, add to the wealth and prosperity of the City and its citizens; and,
WHEREAS, pursuant to the Illinois Municipal Code, 65 ILCS 5/1-1-1, et seq., (the
"Code") as from time to time amended, and more specifically, Sec. 8-11-20 (the "Act"), the
Corporate Authorities are empowered to enter into economic incentive agreements or
redevelopment agreements relating to the development of property or improvements to
properties within the City's corporate limits by which the City agrees to share or rebate a portion
of any retailer's occupation taxes received by the City pursuant to the Illinois Retailers'
Occupation Tax Act (35 ILCS 120/1 et seq.) ("1% Sales Tax") as a direct result of such
development or redevelopment; and,
WHEREAS, before entering into such agreement to share or rebate Sales Taxes, the City
must find that the property subject to the proposed agreement, if developed, supports buildings
which do not meet current codes or are underutilized and, further, that as a direct result of an
agreement to rebate or abate sales taxes, the City will benefit through the retention or creation of
jobs; experience a strengthening of the commercial environment within the City; provide for an
enhancement of its tax base; and, the Project will serve as a catalyst for the commercial
development of adjacent areas; and,
2 �
�I
WHEREAS, the City is prepared to make such findings as required by the Act and such
other incentives all as hereinafter set forth in order to induce Boombah to relocate its distribution
facility to the City and to invest in the redevelopment of the City's Downtown District.
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants hereinafter set forth,the parties agree as follows:
Section 1. Incorporation. The representations and recitations set forth in the preambles
hereto are material to this Economic Incentive Agreement and are hereby incorporated into and
made a part hereof as though fully set forth in this Section I and said representations and
recitations constitute the understandings of the City and Boombah.
Section 2. Findings of the City pursuant to the Code.
As authorized by the Act, the City hereby makes the following findings thereby
authorizing the City to rebate a portion of the I% Sales Tax collected by the City as provided by
the Illinois Revenue Code, as set forth in Section 4 hereof:
A. the Subject Property is currently improved with a structure of approximately
70,000 square feet, most of which is unoccupied and underutilized for at least one (1) year;
B. the addition of a new business operation with no less than ninety (90) employees
shall bring new employment opportunities to the City;
C. that with the addition of a new business to the City and the occupation of an
underutilized, substantially vacant commercial structure, development to adjacent areas is
inevitable;
D. that after weeks of negotiation, it is evident that without the incentives as
hereinafter set forth, the redevelopment of the Subject Property would not be possible; and,
3 �(
E. Boombah's ability to provide no less than ten percent (10%) of the equity
required to undertake this acquisition and relocation demonstrates Boombah's creditworthiness
and financial strength.
Section 3. Boombah's Obligations to the City.
A. On or before December 31, 2011, Boombah shall have acquired fee simple title to
the Subject Property.
B. On or before December 31, 2012, Boombah shall have relocated its business and
its distribution facility and have begun the operation of its business and have certified to the City
that it is employing a minimum of ninety (90) employees at said location.
C. Boombah covenants and agrees that throughout the term of this Economic
Incentive Agreement, Boombah shall:
(i) continue to operate its business and maintain its distribution facility at
the Subject Property;
(ii) pay all of its employees no less than ten dollars ($10.00) per hour as
of 2012, increased by the consumer price index each year thereafter during
the term of this Economic Incentive Agreement.
Section 4. Obligations on the Part of the City to Boombah.
A. Within ninety (90) days after the relocation of the distribution facility and
commencement of the business operation of Boombah at the Subject Property, the City
covenants and agrees to rename Wheaton Avenue to Boombah Boulevard.
B. The City covenants and agrees that for a period of one-hundred twenty (120)
months (the "Rebate Period") after the commencement of Boombah's business operation at the
Subject Property (the "Commencement Date"), the City shall rebate to Boombah every three
months thereafter from the Commencement Date (the "Quarterly Rebate") revenue distributed to
the City from the I% Sales Tax imposed pursuant to the Illinois Revenue Code from Boombah's
4
business operation in an amount equal to fifty percent (50%) of the 1% sales tax from
Boombah's business operation each twelve (12) month period from the Commencement Date
during the Rebate Period.
C. The City also covenants and agrees that during the Rebate Period, the City shall,
each twelve (12) month period during the term of this Economic Incentive Agreement, expend
incremental real estate taxes available as a direct result of the application of the TIF Act to the
Downtown District, an amount equal to the fifty percent (50%) of the 1% Sales Tax distributed
to the City generated by Boombah's business operating at the Subject Property for public
improvements to the Downtown District, on the following conditions:
(i) funds are available within the Special Tax Allocation Fund as
established by the Corporate Authorities for the Downtown
District;
(ii) Boombah or its assignee has invested in excess of two million
dollars ($2,000,000) in the Downtown District; and,
(iii) such expenditures by the City are "redevelopment project
costs" as defined by the TIF Act.
The City shall consult with Boombah to prioritize the public improvements to be undertaken by
the City as a result of its adoption of the TIF Act as applicable to the Downtown Districts and
agrees to prepare a budget for approval of such expenditures by the Corporate Authorities of the
City based on the prior twelve month revenues from the I% Sales Tax generated by Boombah's
business operating at the Subject Property, on or before each April 30 during the term of this
Economic Incentive Agreement.
Section 5. Term of this Economic Incentive Agreement.
5
This Economic Incentive Agreement shall commence upon its execution and, unless
terminated earlier, pursuant to Section 12 hereof, shall terminate upon payment to Boombah of
the Quarterly Rebate of the 1% Sales Tax for the last three months of the Rebate Period.
Section 6. Mutual Agreements.
(A) In order to calculate the amount of the each Quarterly Rebate of the I% Sales Tax
as hereinabove required to be paid to Boombah by the City, Boombah agrees to provide the City
access to all data regarding sales and deposits of sales taxes with the Illinois Department of
Revenue for all business operating at the Subject Property during the term of this Economic
Incentive Agreement. The City and Boombah shall jointly exercise reasonable efforts to
establish a system with the Illinois Department of Revenue to arrange for the receipt of such
information. Additionally, Boombah shall provide or cause to be provided to the City
appropriate completed Illinois Department of Revenue sales tax returns, letters of authorization
to release sales tax, returns or powers of attorney to obtain the data reported thereon, from each
business operating at the Subject Property. Failure to deliver or cause to be delivered, the
necessary documentation to permit the City to access this information shall result in a waiver of
the City's obligation to make any rebate to Boombah until such documentation is provided to the
City.
(B) Time is of the essence of this Economic Incentive Agreement; provided, however,
a party shall not be deemed in material breach of this Economic Incentive Agreement with
respect to any obligations arising from this Economic Incentive Agreement on such party's part
to be performed if such party fails to timely perform the same and such failure is due in whole or
in part to any strike, lock-out, civil disorder, severe weather conditions, wet soil conditions,
failure or interruptions of power, riots, insurrections, acts of terrorism, war, fuel shortages,
6
accidents casualties, floods, earthquakes, fires, acts of God, epidemics, quarantine restrictions,
freight embargoes, or similar causes beyond the reasonable control of such party ("Force
Majeure"). If one of the foregoing events occurs or either party claims that such an event
occurred, the party to whom such claim is made shall investigate and consult with the party
making such claim, and the party to whom such claim is made shall grant any extension for the
performance of the unsatisfied obligation equal to the period of the delay, which period shall
commence to run from the time of the commencement of the Force Majeure; provided that the
failure of performance was reasonably caused by such Force Majeure.
Section 7. Boombah Indemnification.
Boombah shall indemnify and hold harmless the City, its agents, officers and employees
against all injuries, deaths, losses, damages, claims, suits, liabilities, judgments, costs, and
expenses (including any liabilities, judgments, costs and expenses and reasonable attorney's
fees) which may arise directly or indirectly from the failure of Boombah, or any contractor,
subcontractor, agent, or employee thereof(so long as such contractor, subcontractor, agent, or
employee thereof is hired by Boombah) to timely pay any contractor, subcontractor, laborer, or
materialman, from any default or breach of the terms of this Economic Incentive Agreement by
Boombah; or from any negligence or reckless or willful misconduct of Boombah or any
contractor, subcontractor, agent, or employee thereof(so long as such contractor, subcontractor
or agent or employee is hired by Boombah). Boombah shall, at its own cost and expense,
appear, defend, and pay all charges of attorneys, costs, and other expenses arising therefrom or
incurred in connection therewith. If any judgment shall be rendered against the City, its agents,
officers, officials, or employees in any such action, Boombah shall have no obligation
7 Kt
whatsoever, with respect to any acts of negligence or reckless or willful misconduct on the part
of the City or any of its officers, agents, employees, or contractors.
Section 9. Waiver.
Any party to this Economic Incentive Agreement may elect to waive any remedy it may
enjoy hereunder, provided that no such waiver shall be deemed to exist unless the party waiving
such right or remedy does so in writing. No such waiver shall obligate such party to waive any
right or remedy hereunder, or shall be deemed to constitute a waiver of other rights and remedies
provided said party pursuant to this Economic Incentive Agreement.
Section 10. Severability.
If any section, subsection, term, or provision of this Agreement or the application thereof
to any party or circumstance shall, to any extent, be invalid or unenforceable, the remainder of
said section, subsection, term, or provision of this Economic Incentive Agreement, or the
application of same to parties or circumstances other than those to which it is held invalid or
unenforceable, shall not be affected thereby.
Section 11. Notices.
All notices, demands, requests, consents, approvals, or other instruments required or
permitted by this Economic Incentive Agreement shall be in writing and shall be executed by the
party, or an officer, agent, or attorney of the party, and shall be deemed to have been effective as
of the date of actual delivery, if delivered personally, or as of the third (3`d) day from and
including the date of posting, if mailed by registered or certified mail, return receipt requested,
with postage prepaid, addressed as follows:
To the Developer: Boombah
Boombah Blvd.
Yorkville, Illinois 60560
8
With a copy to :
To the City: Bart Olson, City Administrator
United City of Yorkville
800 Game Farm Road
Yorkville, Illinois 60560
With a copy to: Kathleen Field Orr
Kathleen Field Orr& Associates
53 West Jackson Boulevard
Suite 935
Chicago, Illinois 60604
Section 12. Remedies—Liability.
(A) If, in the City's judgment, Boombah is in material default of this Economic
Incentive Agreement, the City shall provide Boombah with a written statement indicating any
failure on Boombah's part to fulfill its obligations under this Economic Incentive Agreement.
Except as required to protect against further damages, the City may not exercise any remedies
against Boombah in connection with such failure until thirty (30) days after giving such notice.
If such default cannot be cured within such thirty (30) day period, such period shall be extended
for such time as is reasonably necessary for the curing of the same, so long as Boombah
diligently proceeds with such cure; if such default is cured within such extended period, the
default shall not be deemed to constitute a breach of this Economic Incentive Agreement. A
default not cured as provided above shall constitute a breach of this Economic Incentive
Agreement. Any failure or delay by the City in asserting any of its rights or remedies as to any
default or alleged default or breach shall not operate as a waiver of any such default or breach of
any rights or remedies it may have as a result of such default or breach.
f
9
(B) If Boombah materially fails to fulfill its obligations under this Economic
Incentive Agreement after notice is given by the City and any cure periods described in
paragraph (A) above have expired, the City may elect to terminate this Economic Incentive
Agreement or exercise any right or remedy it may have at law or in equity, including the right to
specifically enforce the terms and conditions of this Economic Incentive Agreement.
(C) If prior to completion of Boombah's obligations pursuant to Section 3 hereof, any
voluntary or involuntary petition or similar pleading under any section of any bankruptcy or
insolvency act shall be filed by or against Boombah; or any voluntary or involuntary proceeding
in any court or tribunal shall be instituted to declare Boombah insolvent or unable to pay
Boombah's debts; or Boombah makes an assignment for the benefit of its creditors; or a trustee
or receiver is appointed for Boombah or for the major part of Boombah's property; the City may
elect, but is not required to, terminate this Economic Incentive Agreement with or without
notice, to the extent permitted by law and enforceable under applicable federal bankruptcy laws.
In order to terminate this Economic Incentive Agreement for any reason described in this sub-
section (c), the City's sole obligation shall be to record a Certificate of Default with the Kendall
County Recorder's Office, executed by the Mayor and the Mayor's designee, stating that this
Economic Incentive Agreement is terminated pursuant to the provisions of this Section 17(c), in
which event this Economic Incentive Agreement shall ipso facto automatically become null and
void and of no further force and effect.
(D) If, in Boombah's judgment, the City is in material default of this Economic
Incentive Agreement, Boombah shall provide the City with a written statement indicating any
failure on the City's part to fulfill its obligations under this Economic Incentive Agreement.
Except as required to protect against further damages, Boombah may not exercise any remedies
o�
10 1�
against the City in connection with such failure until thirty (30) days after giving such notice. If
such default cannot be cured within such thirty(30)day period, such period shall be extended for
such time as is reasonably necessary for the curing of the same, so long as the City diligently
proceeds with such cure; if such default is cured within such extended period, the default shall
not be deemed to constitute a breach of this Economic Incentive Agreement. Any failure or
delay by Boombah in asserting any of its rights or remedies as to any default or any alleged
default or breach shall not operate as a waiver of any such default or breach of any rights or
remedies it may have as a result of such default or breach.
(E) In addition to any other rights or remedies, a party may institute legal action
against the other party to cure, correct, or remedy any default, or to obtain any other remedy
consistent with the purpose of this Economic Incentive Agreement, either at law or in equity,
including, but not limited to, the equitable remedy of an action for specific performance;
provided, however, no recourse for any claim under or upon any obligation contained in this
Economic Incentive Agreement shall be had against the City, its officers, agents, attorneys,
representatives, or employees, in any amount or in excess of any specific sum agreed to be paid
by the City pursuant to this Economic Incentive Agreement; and no liability, right, or claim at
law or in equity shall be attached to or incurred by the City, its officers, agents, attorneys,
representatives, or employees in any amount in excess of any specific sums agreed by the City to
be paid hereunder, and any such claim is hereby expressly waived and released as a condition of
and as consideration for the execution of this Economic Incentive Agreement by the City.
(F) The rights and remedies of the parties are cumulative and the exercise by a party
of one or more such rights or remedies shall not preclude the exercise, at the same time or
11
different times, of any other rights or remedies for the same default or for any other default by
the other party.
Section 13.Amendment.
This Economic Incentive Agreement, and any exhibits attached to this Economic
Incentive Agreement, may be amended only in a writing signed by all parties with the adoption
of any ordinance or resolution of the City approving the amendment, as provided by law, and by
execution of the amendment by the parties or their successors in interest. Except as otherwise
expressly provided herein, this Agreement supersedes all prior agreements, negotiations, and
discussions relative to the Project.
Section 14. Assignment.
This Economic Incentive Agreement may not be assigned without the written consent of
the City, which consent may not be unreasonably withheld.
Section 15. Counterparts.
This Economic Incentive Agreement may be executed in two or more counterparts, each
of which shall be deemed an original but all of which together shall constitute one and the same
instrument.
[SIGNATURE PAGE FOLLOWS]
VIA",
12
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers on the above date at Yorkville, Illinois.
United City of Yorkville, an Illinois municipal
corporation
By:
Mayor
Attest:
City Clerk
Boomba inois Limited Liabi ' Company
By:
Its Pr ident
Attest:
seey
13