HUNTLEY – The Village Board will vote Thursday on providing a 50 percent, three-year property tax abatement for Hiwin Corporation, which is hoping to move its offices from Elgin to Huntley Corporate Park, just northwest of the Interstate 90 interchange.
Hiwin, a manufacturer of precision machinery with headquarters in Taiwan, is planning to buy a 15-acre parcel and build a 117,500-square-foot structure.
The company anticipates bringing 40 jobs to Huntley and growing to 70 jobs within three years, and the plans allow for a future building expansion of 145,000 square feet.
The 50 percent tax break is estimated at $34,290 over the course of the three-year business development agreement, according to documents from last Thursday's Committee of the Whole meeting.
The village has been in talks with Hiwin for the better part of a year, Village Manager Dave Johnson said, and was competing with out-of-state municipalities for the new facility.
"We really felt for three years that a 50 percent abatement, which for us is estimated to be approximated $11,000 per year, is better than the nothing we’re getting on that site right now," Johnson said. "We really felt like it was a fair agreement for both sides and an engine for job creation."
The initial investment from Hiwin, Johnson said, is estimated at $11.5 million. If it proceeded to expand the building, the investment would rise to $20 million.
The tax proposal was considered and advanced by the board at last week's Committee of the Whole meeting.
Another part of the deal was a three-year partial abatement of real estate taxes by Huntley Consolidated School District 158, in which the facility would be located, according to district documents.
The abatement agreement would halve the anticipated property tax revenue being directed into the district to an estimated $121,000 a year for three years, district officials said, adding that figure is dependent on a finalized assessed value of the building and property, which is not expected until levy year 2017.
Construction is anticipated to begin in the spring of 2016 with occupancy in March 2017, district documents said.
The agreement, backed by district administration, last week was recommended to the school board during the district's latest Committee of the Whole meeting. The vote will be during the next regular board meeting, scheduled for Oct. 15.
From the district's perspective, the agreement means paying "a little more up front" in order to get a bigger benefit in the long run, District 158 Superintendent John Burkey said.
"It's very important for our community that there's more commercial property in District 158," Burkey said. "We are a little over 90 percent residential in terms of our property tax base, and that's high – the state average is about 70 percent."
He later contended that Hiwin's entrance into the village and school district bounds will help taxpayers because "if we get a larger share of property to be commercial, then the tax burden gets spread among entities."
If approved, Burkey said, this would be the first agreement of its kind for District 158, at least that he is aware of in recent years.
A similar deal was provided by Algonquin-based Community Unit School District 300 for the Weber Grill expansion, District 300 officials said. The district entered into a 50 percent five-year tax abatement agreement for the first full five years of the property being fully assessed.