In a scene straight from Capitol Hill, representatives from the auto industry stood before the village council Monday to request a bailout in the hopes of keeping a gasping business alive.
The Currie Group, which operates two car dealerships on Roosevelt Road in Forest Park, painted a dire portrait of its finances in an effort to secure a tax break that still doesn’t guarantee the company’s survival. Steven Jankelow, vice president of the company, described the request as a “revenue sharing arrangement” that would return some of the sales tax revenue the village receives to the dealership. Such agreements are fairly common in Forest Park, but are most often used to entice new development – not shore up a bleeding industry.
“Our Forest Park Chrysler store has lost $462,806 in the last 12 calendar months,” Jankelow said in a Feb. 10 letter sent to Mayor Anthony Calderone. “Our Chevrolet dealership has lost $319,099 since September, and last month alone lost $80,000.”
Currie Group has operated in Forest Park since 1981 and has never received a tax break. The company also owns businesses in Frankfort and Olympia Fields.
Both in the letter and during the Feb. 23 council meeting, Jankelow described his company’s plans to consolidate the Chevy dealership at 7901 Roosevelt into the facility at 8401 Roosevelt. In Forest Park, the Currie Group sells Chrysler and Chevrolet vehicles. However, Chrysler will likely be removed from the company’s inventory.
The company’s lease for the lot at 7901 Roosevelt expires in September, said Jankelow.
Jankelow said he has already begun discussing the consolidation with General Motors, the company that manufactures Chevrolet. Preliminary estimates peg the cost of moving the Chevrolet dealership at $2 million to $2.5 million, said Jankelow. Currie Group is looking for the village to relinquish sales tax revenues to pay for half of that project.
Council members generally spoke in favor of the request, though Commissioner Marty Tellalian cautioned that the village needs to see a business plan from Currie before deciding to invest in the dealership. It was also briefly mentioned that the council may seek some guarantee of a new tenant at 7901 Roosevelt, should the dealerships be consolidated.
“We need to extend ourselves to the business community,” Commissioner Rory Hoskins said. “We don’t want to have an empty spot where there was a dealership.”
The council voted unanimously to begin negotiating with Currie Group.
There was no mention of the actual revenues being generated for the village’s coffers by Currie Group, and several hours prior to the start of the council meeting, Finance Director Judy Kovacs said she was not able to pinpoint those dollars which would come from both sales tax and property taxes. Kovacs also said she had not been asked by any of the elected officials to prepare that information in anticipation of the discussion.
An incentive program reached in 1997 with Gleason Dodge returned 60 percent of the first $200,000 in annual sales tax to the company, according to the village’s 2007 audit. On all amounts beyond the $200,000 threshold, the company gets a rebate of 75 percent. As of April 30, 2007, the village had returned $647,648 to the company.
In Jankelow’s letter to the mayor, the auto dealer representative expressed some frustration in being unable to get a face-to-face meeting with village officials. Those tensions were not apparent during the public discussion, but afterward Jankelow said he had contacted several of the elected officials in recent months to no avail. He declined to name those council members.
Jankelow said he was absolutely stunned his letter to the council was made part of the public record and he did not expect to be on the council’s agenda.
“I am not sure if the village takes us that seriously, but I can assure you that if we do not get help there is every prospect that we will not be operating in Forest Park for much longer and there will be no revenue to share,” Jankelow said in his letter to the mayor. “I am sorry to put the alternative in such stark terms, but I reiterate that I am not sure your colleagues at the village take us that seriously, and if and when we decide to terminate, we cannot go back.”
An attorney for Currie Group, Matt Creen, acknowledged the climate for soliciting public funds in support of private enterprise is somewhat cold given what he described as “bailout fatigue.” Adding levity to the discussion, Calderone jokingly asked Creen and Jankelow whether they’d flown on corporate jets to attend the council’s meeting, a reference to the fierce criticism Detroit automakers endured following their first trip to Washington, D.C., to discuss a federal bailout package.
Part of what separates the dealerships from the Detroit executives, said Creen, is that locally owned showrooms are on the hook if the automakers go under. According to Creen, Currie Group has some $8 million in inventory.
“We own those cars,” Creen said. “If GM goes out of business, we’re out of luck.”