Old Orchard Business District Information
Old Orchard Business District Reimbursement Process
April 14, 2022
Per State of Illinois law, a Business District Allocation Fund must be created for every Business District in Illinois, and is the responsibility of the municipality to do so, which the Village has done. This fund is required to specifically account for the additional one percent Business District sales tax collected at Old Orchard. Like all sales taxes, the Illinois Department of Revenue collects taxes from every applicable business and Skokie’s portion of those taxes are then remitted to the Village monthly. Based on sales and the economic environment, there is no predictability of the amount of taxes collected and to be reimbursed to Westfield throughout the life of the Business District (23 years or less). Westfield is taking all of the upfront financial risk as it pertains to their investment since the development agreement states that Westfield will spend $84 million for the project within the first 10 years or sooner. The risk borne by Westfield is due to the fact that the taxes collected in the fund will be remitted in arrears to Westfield and are only for eligible costs defined by state law. Twice a year, a meeting will be held and Westfield will be able submit to the Village reimbursement requests for development costs incurred at Old Orchard. The Village will only release reimbursements up to the investment expenses as verified. To release reimbursements, Westfield is obligated to provide the Village a description of the eligible costs spent and a summary by category of expenditures along with copies of receipts, invoices, pay requests or other payment substantiation. Should the Village determine that any portion of the funds requested from the fund are not eligible, the Village will provide notice to Westfield requesting additional documentation or validation from an outside audit firm. Skokie may unilaterally terminate the Business District Plan upon reimbursement to Westfield of all eligible costs upon completion of the project or should Westfield abandon the project as evidenced by failing to submit any project summary or project summary notice for 30 consecutive months.