Latest Post | Last 10 Posts | Archives
Previous Post: Lipinski says he’ll vote for Sanders if convention’s contested
Next Post: Beware another criss-cross
Posted in:
* Greg Hinz lays out everything that will have to happen before George Lucas can build his museum at McCormick Place…
If not for the deal, McPier would have to finance more than $200 million in needed maintenance in the Lakeside Center, which is east of Lake Shore Drive—money the agency doesn’t have, they said. But to get that money, the city is cutting an unusual deal with museum patron George Lucas, a deal that will have to be approved not just in Chicago but in deadlocked Springfield.
Under the plan, Lucas would front the city the $743 million that construction of the museum was estimated to cost at its original lakefront site. McPier then would borrow about $1.17 billion, using the Lucas money as collateral of sorts.
Roughly $500 million would be spent for the new convention space at King Drive and $665 million to partially demolish and cap Lakeside Center and to build the museum and related green space on top.
The city would pay that and related debt service on the bonds. But eventually, more money would be needed; Koch and Healey said it would come from shifting to McPier a 2 percent hotel tax that originally was imposed to build U.S. Cellular Field for the White Sox. That levy, which now goes to the Illinois Sports Facilities Authority, would go to McPier after 2032, when it is due to expire, and be continued through 2066.
In addition, Emanuel wants to extend McPier’s tax authorization power to 2066. And, in exchange, the agency would give up after 2022 $15 million in state “incentive” funding it gets to lure conventions here.
All of that would have to be approved by the Legislature and signed into law by Gov. Rauner.
* Mayor Emanuel is publicly optimistic…
Legislators who are up for re-election in November likely would fear being tarred as tax-and-spend politicians if they voted for the mayor’s museum plan, but Emanuel contended Tuesday that it’s visitors, not city residents, who are being taxed — even though many tourists come from the suburbs and downstate.
“There’s a hotel tax, which is visitors that come to the city of Chicago,” Emanuel said. “And so fees that already exist, it’s not new taxes.”
Emanuel also described the spending as a way to keep the city prosperous.
“I would say the right thing to do is invest in the future,” Emanuel said. “While Springfield has its challenges, those challenges do not inhibit the ability to grow the cultural, educational and business and economic future of the city in Chicago. One of the largest employers in the city is the convention and hospitality industry.”
* Hal Dardick at the Trib is not optimistic…
The mayor’s new plan got a noncommittal reception at the Capitol, where spokesmen for House Speaker Michael Madigan and Senate President John Cullerton, both Chicago Democrats, said they’d have to look at the details before commenting. A spokeswoman for Republican Gov. Bruce Rauner declared the matter “under review.”
The list of unresolved issues in Springfield is long, with school funding, a CPS bailout, lack of a major construction program, the budget impasse and Rauner’s pro-business, union-weakening agenda at the top.
Given that, Laurence Msall, president of the nonpartisan Civic Federation budget watchdog group, questioned whether the mayor’s plan was coming at an appropriate time.
“In the midst of a state budget crisis that has prevented the legislature from addressing some of the most basic requests of the city of Chicago and the Chicago Public Schools, it is difficult to see how this enormous request for state resources fits into the priorities of the city and the state of Illinois’ financial crisis,” Msall said.
posted by Rich Miller
Tuesday, Apr 19, 16 @ 1:05 pm
Sorry, comments are closed at this time.
Previous Post: Lipinski says he’ll vote for Sanders if convention’s contested
Next Post: Beware another criss-cross
WordPress Mobile Edition available at alexking.org.
powered by WordPress.
“IT’S A TRAP!”
– MrJM
Comment by @MisterJayEm Tuesday, Apr 19, 16 @ 1:27 pm
Without even thinking about the Lucas Museum the MPEA financial situation is perilous at best.
The MPEA bond debt service is ramping up.
The debt service increases 28.58% next year, by 2026 it will have doubled to 102.84% of the present payment obligation, to 133% in 15 years.
The $15 million that the State is currently uses to pay out in bribes, or as they call them “incentives” to the trade show associations are scheduled to stop in a few years.
How the MPEA intends to wean these trade shows off this corporate welfare while trying to at least break even is beyond comprehension.
The MPEA deficit has grown to $1.4 billion since the reform legislation and 14 shows have now left McCormick Place since 2010. 14 shows have left McCormick Place with $15 million a year in State incentive money while MPEA revenue from the use of exhibition facilities remains at half of what it was before the reforms.
Soon, they won’t need to worry about demolishing McCormick Place.
It will be so far under water that all you will be able to see is Lake Michigan where McCormick Place stands today.
Comment by Chicago 20 Tuesday, Apr 19, 16 @ 1:36 pm
The Mayor is right here. You cannot shut down investment just because the state is in crisis.
Comment by Square Pegs Tuesday, Apr 19, 16 @ 1:45 pm
In contrast it would be less expensive to demolish Soldier Field, replace it with the Lucas and build a new stadium with a moveable roof and seating capacity to meet NFL guidelines for holding a Super Bowl.
Comment by Chicago 20 Tuesday, Apr 19, 16 @ 1:56 pm
well played, MrJM
Comment by quicknote Tuesday, Apr 19, 16 @ 1:58 pm
–Without even thinking about the Lucas Museum the MPEA financial situation is perilous at best.–
It’s really not.
If dedicated convention and tourism taxes (hotels, taxis, restaurants, etc.) can’t cover the nut, a pledged share of the state’s sales tax provides multiple-times coverage on MPEA bonds.
That’s why they were rated AAA, until the Superstars vetoed the approp. that moved existing, dedicated funds into an escrow account for payment.
Comment by wordslinger Tuesday, Apr 19, 16 @ 2:08 pm
Another hostage for Rauner’s Turnaround Agenda.
Comment by DuPage Tuesday, Apr 19, 16 @ 2:12 pm
Did I hear someone tell Rahm, “let the farce be with you.”
Comment by Norseman Tuesday, Apr 19, 16 @ 2:21 pm
The MPEA still owes the State over $57 million when they needed to borrow from the Staye sales tax revenues to meet their obligations.
The peril here is on the taxpayers, not the bond holders.
Comment by Chicago 20 Tuesday, Apr 19, 16 @ 2:23 pm
–In contrast it would be less expensive to demolish Soldier Field, replace it with the Lucas and build a new stadium with a moveable roof and seating capacity to meet NFL guidelines for holding a Super Bowl.–
Really? What’s your “less expensive” price tag on all that, and where would the new Bears’ stadium be?
And just a reminder, although delisted from the National Register of Historic places, Solider Field remains a war memorial.
Comment by wordslinger Tuesday, Apr 19, 16 @ 2:53 pm
What’s been built on the old Michael Rees land? Why can’t we put it there?
Comment by Cheryl44 Tuesday, Apr 19, 16 @ 3:50 pm
The Soldier Field redo was $690 million.
As ridiculous and foolhardy as it is, the Soldier Field stadium could be torn down and a new stadium could be built at the old Michael Reese Hospital location.
The new stadium could have a retractable roof and a seating capacity that would meet NFL Super Bowl requirements and still cost less than Emanuel’s proposal.
Comment by Chicago 20 Tuesday, Apr 19, 16 @ 4:16 pm
Chi 20, I’m really not following you.
So you’d tear down a stadium war memorial (cost?) that you’ll still be paying the bonds on to 2032, bond out for a new NFL stadium (the last three ranged from $720 million to $1.6 billion) and then something-something for Lucas at the old Soldier Field site (cost?).
I’m not seeing any less-expensive there, at all. That, my friend, is a nightmare.
Comment by wordslinger Tuesday, Apr 19, 16 @ 4:35 pm
You are following me.
It’s just as ridiculous, but probably a few bucks cheaper.
Comment by Chicago 20 Tuesday, Apr 19, 16 @ 4:58 pm
I’ve read all of today’s press on this plan and can’t figure out one thing-maybe someone can help me out.
Where does Lucas’ dough go once it’s done being used as “collateral?” Appears to me that the MPEA plans on issuing bonds for the full cost of the project.
Comment by Arthur Andersen Tuesday, Apr 19, 16 @ 5:49 pm
Think of the Lucas money as the down payment.
Comment by Chicago 20 Tuesday, Apr 19, 16 @ 6:16 pm
A down payment that puts a dent into the massive MPEA and that will give the MPEA cash flow until they can burrow more money, guaranteed by the State, that our grandchildren will still be paying years from now.
Comment by Chicago 20 Tuesday, Apr 19, 16 @ 6:33 pm
Phew! I guess Chicago’s fiscal crisis did just blow over. Now let’s build that eyesore.
Comment by Cathartt Representative Tuesday, Apr 19, 16 @ 6:41 pm
This is crazy talk!
Comment by dr. reason a. goodwin Tuesday, Apr 19, 16 @ 8:02 pm
Thanks, Chi 20. I’m not sure if I agree with this concept.
Comment by Arthur Andersen Tuesday, Apr 19, 16 @ 8:22 pm
I would not trust any estimate from this group and this project in particular. Sorry Rham
Comment by cannon649 Tuesday, Apr 19, 16 @ 9:52 pm