A preliminary draft of a 15-year agreement between an auto dealer and the village council obligates taxpayers to cover half of the company’s renovation costs in exchange for a guarantee that the dealership remain in Forest Park.
Currie Group, which operates two car dealerships on Roosevelt Road, has been working with the municipality since February to see a portion of its future sales tax revenue returned to the company. The public subsidy is necessary, according to the company, to help Currie Group survive an economic recession that has frozen credit markets and forced the company’s product supplier, Chrysler, into a massive restructuring.
Currie Group intends to shutter one of its dealerships and renovate the other, most likely for the purpose of carrying a new product line.
Last month, in a federal bankruptcy court filing in New York, Chrysler named 789 dealerships across the country for which franchise agreements would not be renewed. Currie Motors, at 8401 Roosevelt, was among those on the list. Currie Group’s other Roosevelt Road dealership, which carries Chevrolet vehicles, is located at the corner of Desplaines Avenue.
“It is assumed that the Chevy store would relocate from Desplaines and Roosevelt to 8401 W. Roosevelt, the prior location of Currie Chrysler,” Mayor Anthony Calderone said in a June 19 memo to council members. “In speaking with Currie Motors, Chevy will require substantial improvements to the 8401 site in the millions of dollars, and but for the village’s participation, this project cannot move forward. You should know the auto dealers are substantial sales tax producers and it would be in our best interest to assist them.”
When Currie Group’s vice president, Steven Jankelow, first appeared before the council in February to ask for the subsidy, he argued that municipalities often extend tax breaks to private companies as an incentive for doing business there. Currie’s dealership has been in Forest Park since 1981 and has not received any tax breaks.
During the council’s June 22 discussion of the contract, members ignored a provision that would cap the village’s payments. It is expected, however, that as negotiations continue more details will emerge.
In earlier discussions with the village, Jankelow indicated the dealership is looking for an estimated $1 million in public money.
Over the life of the contract, money would be paid back to the dealership from sales tax revenues paid to the village. According to the proposal, the village would retain the first $50,000 in municipal sales tax. Half of any tax revenues after that amount would be paid back to Currie Group.
Between the two dealerships, Forest Park received nearly $400,000 in sales tax revenue in 2008, according to Finance Director Judy Kovacs. Through the first four months of 2009, said Kovacs, revenues are down 50 percent year over year.
In March, the Review reported that the president of Currie Group is one of the United Kingdom’s wealthiest citizens, and was worth an estimated $169.2 million in 2008, according to The Times of London. Abraham Jaffe, the company’s president, died later that month.
Council members who said they were not aware of Jaffe’s millions said the wealth behind Currie Group makes little difference in whether they would support extending a tax break. Compared to other industries, auto dealerships typically generate large amounts of tax revenue for municipalities. Several commissioners begrudged those in the private sector who induce a bidding war that ultimately uses public money to enhance profits.
Representatives from Currie Group did not address the council during the June 22 meeting.
