IH Mississippi Valley Credit Union's plans to build a $26 million headquarters on Moline's riverfront received the blessings of City Council on Tuesday, but the vote was not unanimous.
In 7-1 vote, aldermen approved the city's development agreement with the credit union and developer Russell Construction.
Moline plans to sell property at 2500 River Drive to the credit union for $2.925 million for the 80,000-square-foot facility. Construction is expected to begin in the spring.
The property is located in an established TIF Redevelopment Project Area that is set to expire in 2036.
The city’s total incentive payment will be paid from the net incremental real estate tax generated by the project. IH Mississippi Valley will receive a TIF incentive payment of up to $3.9 million, or 15 percent of the $26 million project. The credit union also will be rebated for eligible TIF expenses, including site work up to $525,000 for a total incentive package of $4.425 million.
The lone dissenting vote came from 6th Ward Alderman Kevin Schoonmaker, who objected to an incentive package for a company that pays no income tax.
"I think IH has negotiated a great deal," Schoonmaker said. "It's a very generous incentive package. However, the project creates no sales tax, no hotel-motel tax, no food and beverage tax. There's minimal jobs coming to Moline, I believe the number is 40. Most of those jobs, in fact, are just moving down the hill from Moline.
"My largest issue, though, is with the significant incentives that are being awarded to a company that pays no income tax, and I find that hard to swallow," Schoonmaker said.
"The hard-working Moline taxpayers, both the citizens and the businesses that pay income taxes, should not be asked to carry this significant burden for this development," he added. "This company already receives its incentives through its tax-free status. That's my objection."
Alderman Mike Wendt, 3rd Ward, said that while he understands Schoonmaker's concerns, "I do believe that this will be a great anchor along the riverfront that hopefully will inspire and create additional developments along the area."
Additionally, Wendt said that retaining jobs within the Moline sphere is a very important aspect of the agreement. The credit union is starting at 220 jobs and will be adding about 80 jobs over the initial 10 years of the project.
Alderman Dick Potter, 4th Ward, speaking to Schoonmaker, acknowledged the 5th Ward alderman's concerns, and even shared some of them.
"This is not something we would normally do," Potter said.
However, Potter voted in favor of the project, because "the residents can be satisfied that they're protected and will see an amazing building as the new bridge goes up."
He added that the new building "will set the bar pretty high for new development and future development."
Caitlin Russell, vice president of Russell Construction, said the company hopes to break ground in March and that the credit union should be ready to occupy in late 2019.
"This will be a statement piece for the Quad-Cities and the riverfront," Russell said. "It will help spur I-74 development once the bridge moves."
Moline Mayor Stephanie Acri said after the meeting that the development is an anchor investment for the city.
The development has jobs "that supports other things we're working on such as retail and housing," Acri said.
"All of that works together. What we're focused on is balanced growth and this project brings balance to what we're working on."
Brian Laufenberg, credit union president and CEO, said the new building will have a community room and "a lot of collaborative space and innovation space" to connect with the Western Illinois University Quad-Cities campus.
Laufenberg said he is passionate about the Quad-Cities Chamber's Q2030 initiative to "keep good Quad-City talent here and the younger people here."
Students coming out of college should not feel they have to go somewhere else for a career, he said.
"So we want to put those partnerships together and we're working with the college," he said.
Laufenberg said the credit union serves 42 counties in Iowa and Illinois.