Category Archives: City of Peoria

City Council, City of Peoria, Elections

Rewind: History of City Council election process

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Back in November 1987, the last time the City Council’s election process was changed, then-Journal Star reporter Paul Gordon wrote a very interesting story on the history of the process.

I’ve reprinted the complete article below, but here’s the summary, with some additional information to bring us up to 2011:

Years Election Process
Before 1845 Governed under township system, with a board of trustees and a board president
1845-1953 Mayor and, initially, eight aldermen elected from four wards, with elections held annually. The council grew with the city, and by 1951, there were 11 wards and 22 aldermen.
1953-1960 Council-manager form of government adopted; one mayor and all council members elected at-large.
1960-1972 In a special election, voters decide to reestablish the ward system. Ten wards are established with one councilman elected from each; terms are not staggered. There are no at-large seats.
1972-1991 Under new state legislation, a binding referendum was held that established five districts and three at-large seats (total of 8 council members, plus the mayor), with staggered terms.
1991-present As a result of the 1987 Voting Rights lawsuit settlement, our current system was established with five district councilmen and five at-large councilmen elected via cumulative voting. The first at-large election under the new system was held in 1991.

Now in 2011, there is talk of doing away with the current system and returning to possibly ten districts and no at-large councilmen, which would be essentially what we had in the 1960s. It’s also the resolution originally sought in the voting rights case of 1987.

In 1987, a lawsuit (Joyce Banks, et al. v City of Peoria, case number 87-2371) was filed against the City of Peoria, District 150 Board of Education, and the Peoria Park District, alleging that the method of electing at-large members “prevented minorities from getting elected to the boards because the number of white voters outnumbered minorities.” The suit originally sought to abolish at-large voting completely from all three boards. But in a settlement before the case went to trial, plaintiffs agreed to eliminate at-large voting from the school district and park boards, and develop a different solution for the City Council: a total of five at-large members (an increase from three) plus the implementation of a cumulative voting system.

Why? According to a Nov. 1, 1987, Journal Star article, one of the plaintiffs, Joyce Banks, stated “their original demand for across-the-board district voting was dropped because blacks reasonably could be assured of one seat on a district-only council…. With the agreed-upon changeover to cumulative voting for at-large seats on the City Council, Banks said a well-organized black community could capture two or three seats on what would become a 10-member council.”

That’s more or less how it has worked out. Today, there are two black members on the council: first-district councilman Clyde Gulley and at-large councilman Eric Turner. If the council were to change back to a ten-district system, it’s hard to say how minority representation would change. Minority population has increased over the past 24 years, so presumably more than one district could be made up of a majority of minority voters. Plus, it’s not as if white people only vote for white people or black people only vote for black people. For instance, Turner lives in the fifth district of the City, which is predominantly white, and he received a large number of votes from that area in the last at-large election. There’s no reason he couldn’t continue to win a seat in that area of town even under a district-only process.

It is interesting that changing to a ten-district council would be a trip back to the future, so to speak. One wonders if, in another ten or twenty years, there will be yet another group vying for a return to the good old days of cumulative voting, or perhaps a strong-mayor form of government. It seems we’re never satisfied with whatever process is currently in place.

Continue reading Rewind: History of City Council election process →

City Council, City of Peoria

Pro-Wonderful-Development letter-writing campaign continues

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Investors, doctors, politicians, and other wealthy and well-connected citizens have been flooding the City Council’s mailboxes with letters of support for Gary Matthews and the downtown hotel project. Many of them are form letters, or at least incorporate boilerplate language such as this:

It is my [or “our”] understanding that EM Properties has worked closely and judiciously with city staff, Civic Center authorities, labor unions, construction companies, lenders, sellers and the well respected hotel group, Marriott, in order to piece together all of the parts of this intricate transaction. All aspects of the project have been vetted, reworked and vetted again to insure its success. It is crucial to the revitalization of our downtown and the future of our city and region that the project moves forward. Job creation and maintenance are vital.

The completion of this project will better position many companies in the area to better market our community and enrich our local economy in order to compete with surrounding areas.

In March of this year, ground was broken for a new Courtyard by Marriott in Newark, New Jersey. It will include 150 rooms and 14,000 square feet of retail space, and is “expected to generate approximately 175 construction jobs, and a total of between 50 and 75 permanent jobs through the hotel and retail operations.” How much money do you think the City of Newark contributed to this boon to their local economy? Answer: a $500,000 loan “to assist the Courtyard by Marriott with gaining site control.”

Meanwhile in Peoria, to get our own new 119-room Courtyard by Marriott, plus a renovation of the Pere Marquette with a gerbil tube to the Civic Center, it will take a gift of $37 million from the taxpayers. Does something seem a little off to you? Perhaps the reason is that our workers are not as efficient. According to a May 23, 2010 Journal Star article, “professor Bob Scott at Bradley University expects 840 construction jobs to be created when EM Properties and Marriott International team up on the $102 million Downtown project.” That’s nearly five times as many construction jobs as are necessary to build a hotel in Newark.

I think the letter writers and supporters of the Wonderful Development are missing the point. They’re all arguing the merits of an upscale downtown hotel in close proximity or connected to the Civic Center. That’s all well and good. But at what price? Should the City take on a third of the risk for this $102 million private development? Should a City taking on said risk continue to trust a developer that has demonstrated a consistent inability to meet deadlines and projections? Would doing so really be in the taxpayers’ best interests? If the developer is unable to meet short-term projections (like when he can start construction), how can we trust him to meet long-term projections (like the future profitability of the venture)?

This project has been approved for two and a half years. It was approved twice. It has been over nine months since the latest deadline was missed. Each time the developer has come to the table, he’s assured the council that he was ready to start. In May 2010, he said he was ready to start “immediately.” Everything was in place. All that was missing was the Council’s approval.

Sixteen months later, nothing has started, and the City Manager cancels the agreement. So now what do we hear? Here’s another sample from a pro-hotel letter to the Council: “All pieces are in place, as outlined in brief above, we just need the nod from the council, and the city to sell the bonds. We can close in 60 days.” Where have we heard that before?

The Wonderful Development must die.

City of Peoria

New York consultant should put money where his mouth is

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On today’s Journal Star opinion page is a letter “in the spotlight” from Peter Bazeli of New York, New York. He extols the Wonderful Development and warns that “this facility is critical to Peoria’s economy.” I don’t know about you, but when I want to know what’s critical to our economy here in Peoria, the first person I ask is a resident of New York. I’m sure Mr. Bazeli often consults with Peoria residents on what’s critical for New York’s economy as well.

“If the project is executed well,” he says, “the investment will be well worth it in the long term, paying dividends in many diverse ways for generations to come.” Of course, the successful execution of the project is precisely what is in question here, but I imagine it’s a little hard to follow all the details of this issue when you live 900 miles away.

And just what does Peter Bazeli do that makes him such an expert on how we should spend our tax money here? He explains, “Professionally, I am a consultant to developers and private equity funds investing in projects like this throughout the United States….” Well, hot dog! That’s great news for the Wonderful Development! Mr. Bazeli could save this project by simply recommending it to his New York colleagues and drumming up $37 million worth of private equity to replace the City’s tax investment. Problem solved!

Why not? After all, this investment will be well worth it in the long term, paying dividends in many diverse ways for generations to come. Why wouldn’t his partners, or even Mr. Bazeli himself, want in on that kind of sure-fire investment?

I sure hope Mr. Matthews reads the paper today and is able to contact Bazeli soon. This could be just the break he needs.

City of Peoria, Nation/World

Peoria Hosts Event In Observance of the 10th Anniversary of 9/11

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I don’t know if you’ve heard, but Sunday will be the 10th anniversary of the 9/11 terrorist attacks. There have been one or two stories in the news about it recently. The City of Peoria is having a big remembrance event downtown tomorrow, the day before the anniversary. Here’s the press release:

Peoria, Illinois – The City of Peoria’s 9/11 Remembrance Event will be held at O’Brien Field on September 10, 2011, from 10:00 until 11:15 a.m. This special service, which is free and open to the public, is a tribute not only to those individuals who lost their lives on that fateful day, but to the men and women who continue to risk their lives to keep our nation safe. The gates of O’Brien Field will open at 9:00 a.m., and spectators will be greeted with performances by The Peoria Ballet, Pulses of Hope, and the Richwoods Gospel Choir. Vehicles will be displayed along Jefferson Street as we showcase first responders from the military, police, fire, and medical services.

We are pleased to welcome Vice Admiral Robert S. Harward, Deputy Commander, U.S. Central Command (USCENTCOM) as the guest speaker for our 9/11 Remembrance Event. Vice Admiral Harward commanded troops in Afghanistan and Iraq for over six years since September 11, 2001, where he last served as the commander of the Combined Joint Interagency Task Force (CJIATF) 435.

Due to the power outages experienced in Southern California, the Navy Parachute Team (Leap Frogs) will be unable to perform at the event. The Leap Frogs’ originate from San Diego, California, and the power outage prevented their flight from taking off this morning.

CityLink will run Park and Ride shuttles from Evergreen Square (in front of Lenscrafters – 801 W. Lake Avenue) to O’Brien Field, starting at 9:00 a.m. The shuttle will return riders to Evergreen Square immediately following the event.

Everyone is encouraged to show their pride by wearing red, white, or blue to the event.

City Council, City of Peoria, State of Illinois

Koehler goes to bat for Matthews

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The pressure is mounting on the Peoria City Council. Now State Senator David Koehler has weighed in with a letter supporting developer Gary Matthews:

Letter from Sen. Koehler

Here’s the text of the letter:

I am respectfully asking you to reconsider all available options so that we may see the Downtown Marriott Hotel Project agreement with EM Properlies, Ltd. move forward. Given the hard work carried out by you, the City of Peoria, EM Properties, Mike Everett and the West Central IL Building and Construction Trades, it would be a real setback if we were not able to move forward with this job creating and economic growth project at this time.

Further, if the project is abandoned now, we would be leaving behind valuable and hard won tax credits procured through the Illinois General Assembly. Just to clarify, if the tax credits are not used by the current developer, we would have to go back through the time consuming legislative process to have a new bill passed before they would be available to any other developer.

In the interest of downtown economic development and job creation, I hope that we can find a way to resume the Marriott Hotel Project. Again, I ask for your reconsideration of all available options to keep this project.

My take: I wonder if Sen. Koehler has sent any similar letters to developer Gary Matthews over the past two and a half years. You know, letters expressing the importance of this project and putting pressure on him to get started on it; letters explaining that the tax credits can only be used by him and that they will be lost if he fails to fulfill his agreement with the City. And about those “hard won tax credits” — are those the one that Governor Pat Quinn agreed to sign after Mr. Matthews contributed $10,000 to his campaign? Hard won, indeed. Was the point of that legislation to force the City to fulfill a contract with a developer whether or not he performs?

Also, is what Sen. Koehler said really true? According to Public Act 096-0933, “For tax years beginning on or after January 1, 2010 and ending on or before December 31, 2015, a taxpayer who qualifies for a credit under the Historic Preservation Tax Credit Pilot Program Act is entitled to a credit against the taxes imposed under subsections (a) and (b) of Section 201 of this Act as provided in that Act.” And just who is a qualified taxpayer? It’s “the owner of the qualified historic structure or any other person who may qualify for the federal rehabilitation credit allowed by Section 47 of the federal Internal Revenue Code.” And finally, what is a “qualified historic structure”? “‘Qualified historic structure’ means a hotel that is located in the City of Peoria and that is defined as a certified historic structure under Section 47 (c)(3) of the federal Internal Revenue Code.” That pretty much means the Pere Marquette.

So from a plain reading of the law, it appears that the historic tax credits are limited to the Pere Marquette, but not limited to Gary Matthews as the developer. The current owners of the Pere Marquette, for instance, could get these tax credits, it would appear. The only other limitation in the law has to do with timing — the credit can only be taken during tax years prior to 2016. Could there be other restrictions? Certainly. I’ve heard anecdotally that there is some sort of application process, and that the window of opportunity for applying is now closed. But I have not been able to find a citation to such a provision so far.

But why question him? Let’s assume he’s right, and we’ll lose these tax credits. What are we losing? Nothing. This is like the person who thinks that, if they don’t buy a $5 box of Cheerios so they can use their 50-cents-off coupon, they will be “losing” fifty cents. In fact, they could just not buy the box of Cheerios and not spend $4.50. We’re not losing the tax credits; we’re not spending $37 million that we don’t have and may never be able to recoup. Furthermore, Gov. Quinn signed into law River Edge Redevelopment historic tax credits which the City could use toward redevelopment of the Pere if it’s included in the redevelopment zone.

Bottom line, with all due respect to Sen. Koehler, the City of Peoria needs to look out for the best interests of its taxpayers, and cancelling this project is the way to do it. I know there are a lot of good-hearted investors that only want what’s best for Peoria, and I applaud them for their efforts. But there is no reason to put any more faith in the developer, and with the economy’s continuing weakness, there is even less reason than in 2008 to believe this project will ever be profitable. Not all investments work out, and the government can’t afford to keep bailing out bad investments.

The Wonderful Development must die.

City Council, City of Peoria

Matthews makes his case to Council

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Developer Gary Matthews has written a letter to the Mayor and City Council asking them not to cancel the redevelopment agreement:

Matthews Letter 09-02-2011

The gist of the letter is that Matthews felt he had provided everything to the City that was requested, and that as a result of certain meetings he was led to believe he was meeting the terms of the redevelopment agreement to the City’s satisfaction. The December 31, 2010, deadline stipulated in the redevelopment agreement remains unaddressed and unacknowledged. He concludes:

I know and understand we are all suffering from some “hotel fatigue.” I apologize for adding to that fatigue but I feel it is necessary that you have accurate information. Yes, it has been a long, arduous journey, but we are on the cusp of what can be a very historic project. The budget has gone through many transitions as obstacles were confronted (e.g., the inability to secure new market tax credits for a hotel project in a middle sized city) but again and again, with cooperation from lenders (agreeing to better terms), sellers (agreeing to assist with financing), tax credit investors (agreeing to higher purchase prices) and us agreeing to defer the developer’s fee, new options were created to make the project successful. Also, as you know, the State of Illinois adopted a pilot State Historic Rehabilitation Tax Credit program specifically for this project. Failure to close when we are so close will result in the loss of these credits and a missed opportunity for the City.

This project is a transformative and catalytic project for the Peoria region. Its construction will not only create jobs, but help also revitalize the downtown and surrounding Peoria areas by encouraging and influencing development resulting in a positive community and economic impact.

Pretty good sales pitch, except here we are over two and half years after we first heard it and the project has yet to start. Keep in mind that the first redevelopment agreement from December 2008 was never fulfilled. In May 2010, when the latest agreement was made, Matthews told the council that he would be drawing on the $37 million grant from the city “immediately in 2010,” something he could only do subsequent to closing on the properties. He further said that work on the Pere Marquette would begin “immediately after closing.” He also assured the Council at that time that he had all his financing in place. Now it’s September 2011, and the Council receives a letter with more promises and assurances that everything is in place and ready to start. I’m beginning to see a pattern.

Matthews stands to make $9 million from this deal, and he has already racked up no small amount of money on attorney’s fees, architect fees, marketing, etc. It’s very important to him that this deal go through. But he has consistently missed deadlines and shown an inability to get the project started. His apologists blame this failure on the economy. But I have news for you: the economy isn’t getting any better.

The City is doing the right thing by cutting its losses on this project. Even if they have to pay Matthews a settlement to help defray some of his expenses (I would suggest only those expenses incurred from the December 31 deadline to the present), they would be money ahead.икони

City of Peoria

Peoria Chronicle Exclusive: Matthews threatens to sue over hotel deal termination

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In a statement released today, EM Properties claims it…

…has satisfied all conditions of the Redevelopment Agreement required to proceed with a closing for the Downtown Marriott Project. We believe we have provided sufficient evidence of financing. We plan to confirm the financing we currently have and further solidify our submissions to the City Council within the next week. We share the City of Peoria’s urgency for a real estate closing and look forward to one this fall to bring this great project to fruition.

And they are threatening to sue the City for breach of contract if the project is cancelled. You can read the letter from their attorney here:

Husch-Blackwell-Letter

Here’s the bottom line: The redevelopment agreement listed thirteen things that Matthews/EM Properties had to fulfill. The City’s termination letter said that EM Properties had not fulfilled them. Now EM Properties’ attorneys are saying they did fulfill them, and therefore the City has no right to terminate the agreement.

But there’s one thing that EM Properties’ attorneys are missing. The redevelopment agreement states in section 6.7, “If the conditions precedent set forth in Section 6.4 do not occur on or before December 31, 2010, then the City may cancel this Agreement by notifying the Redeveloper in writing.” Note the date: December 31, 2010. It’s a publicly-established fact that these conditions were not met by the deadline. So EM Properties doesn’t have a leg to stand on. They can argue until they’re blue in the face that they’ve satisfied all the conditions, but if they weren’t satisfied by the deadline, the City has every right to cancel the agreement. Case closed. This is nothing more than a scare tactic — an act of desperation.

City Council, City of Peoria

The (not so) Wonderful Development, 2008-2011, R.I.P. (UPDATED)

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It’s all over but the shouting.

The Journal Star reports that the City has notified Gary Matthews that they are terminating the redevelopment agreement for the Hotel Pere Marquette and surrounding properties.

In short, the three-page letter states the city is within its rights to pull out of the agreement because it is after Dec. 31, 2010 — the date at which the city could unilaterally withdraw under the terms of the deal if certain benchmarks were not met — and that there still are significant details missing on the financing Matthews’ business, EM Properties, was required to obtain. Indeed, it states that what has been provided thus far is “nothing close to what the city could prudently accept” as evidence. […] Though city lawyers believe the letter sent to EM Properties is adequate notice to terminate the agreement, City Council members will be asked to formally ratify the decision in a vote at their Sept. 13 meeting to confirm they agree with the move.

Letter Terminating the Wonderful Development

And so dies the vaunted Wonderful Development — a project that was so time-critical that it had to be approved practically overnight three years ago without any public input and as little notice as legally possible; a project that was going to be constructed “immediately” according to Matthews in May 2010; a project, the financing of which the Council was assured by Mr. Matthews was all in place over a year ago; a project Mr. Matthews was so confident about that he loudly and publicly blew off Councilman Gary Sandberg’s questions, saying “Just vote no, councilman”; a project that was going to cost the City of Peoria taxpayers up to $37 million, most of which was going to go into the pockets of Mr. Matthews and the owners of Big Al’s; a project that was going to relocate Big Al’s to a piece of property immediately adjacent to a day care facility; a project that ultimately fell apart like a house of cards.

City leaders will no doubt bemoan the cancellation of this project and say it’s a sad day for Peoria. And there may indeed be some unfortunate outcomes. The fate of the Pere Marquette would seem to be in question, for instance. But the losses that would have resulted had the project come to fruition would have been far worse. The City simply can’t afford the debt service on up to $37 million in bonds. No matter what they tell you, that project was never going to pay for itself. Their predicted occupancy rates and revenues were about as likely to come to pass as the Cubs winning the World Series.

On a positive note, I just want to express my appreciation to Mayor Ardis and City Manager Patrick Urich for finally pulling the plug on this project. You just know there was no small amount of pressure placed on the City to contribute even more toward making this project a reality, but to their credit, they said enough is enough. They didn’t let Matthews come back to the well a third time looking for more concessions and/or funding.

My hope is that, out of this abject failure a better project will arise: one that is privately funded and likely to succeed; a truly wonderful development.

UPDATE: I contacted Randy Ray to find out the disposition of the Franklin Street lot. Here’s his response: “The contract with Main Street Trust and Al’s for the Franklin lot terminated by its own terms because closing did not occur by July 31.” So, in other words, Big Al’s will not be moving, and the City retains ownership of the lot adjacent to the bus depot.

City Council, City of Peoria

Business District project costs to double if amendment passes

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A public hearing will be held at Tuesday evening’s City Council meeting on a proposed amendment to the downtown Hospitality Improvement Zone Business District Development Plan (or HIZ BDD Plan, for short). The amendment consists of these two changes:

  1. Adding Staybridge SuitesIn order to add property to the HIZ BDD Plan, the added property has to qualify as “blighted.” According to state ordinance a “blighted area” is an area

    which, by reason of the predominance of defective, non?existent, or inadequate street layout, unsanitary or unsafe conditions, deterioration of site improvements
    the definition of timesheet>, improper subdivision or obsolete platting, or the existence of conditions which endanger life or property by fire or other causes, or any combination of those factors, retards the provision of housing accommodations or constitutes an economic or social liability, an economic underutilization of the area, or a menace to the public health, safety, morals, or welfare. [65 ILCS 5/11-74.3-5]


    According to the council communication [note: large PDF file], Staybridge Suites qualifies “due to the deterioration of site improvements which constitutes an economic underutilization of the area.”

    Staybridge Suites was built in 1999 for around $7.5 million. In twelve years, we’re supposed to believe that it’s now “blighted” due to “the deterioration of site improvements”? Well, maybe, if it was built by the same contractor that built Riverfront Village. Still, if this is “blighted,” then every building in the City of Peoria is blighted:

    Looks like a real dump, doesn’t it? It’s worth noting that the council communication does not provide any documentation to substantiate this supposed “deterioration” and “economic underutilization.” It simply makes the claim without any evidence to back it up.

  2. Doubling estimated business district project costsThis is perhaps the most curious part of the amendment. The amendment increases the total estimated business district project costs from $6 million to $12 million. They’ve also lengthened the list of things on which they can spend that money. Here’s a comparison between the original plan and the proposed amendment:
    Original BDD Plan Amended BDD Plan (Proposed)
    The Business District costs are estimated at $6,000,000 and may include:

    1. Buying and selling of land.
    2. Infrastructure improvements.
    3. Rehabilitation of existing property.
    4. Development costs associated with new taxable private development.
    5. Façade and streetscape improvements.
    		 Business District project costs are estimated at $12,000,000 and may include the following, in accordance with the provisions of the Act:

    1. Cost of studies, surveys, development of plans and specifications, implementation and administration of a business district plan, and personnel and professional service costs.
    2. Property assembly costs.
    3. Site preparation costs.
    4. Costs of installation, repair, construction, reconstruction, extension or relocation of public streets, public utilities and other public site improvements within or without the business district which are essential to the preparation of the business district for use in accordance with the business district plan.
    5. Costs of renovation, rehabilitation, reconstruction, relocation, repair, or remodeling of any existing buildings, improvements, and fixtures within the business district.
    6. Costs of installation or construction within the business district of buildings, structures, works, streets, improvements, equipment, utilities, or fixtures.
    7. Financing costs.
    8. Relocation costs

    What is the meaning of all these additions? You know there’s a reason these changes are being made. If the original plan were sufficient, there would be no need for this amendment. Look closely at some of these changes.

    Note in particular number 4 in the amended list: HIZ BDD funds can be used for improvements “within or without [emphasis added] the business district which are essential to the preparation of the business district….” If I’m reading this correctly, it would appear that funds from the HIZ BDD could be used to prepare the new Big Al’s site, for instance, even though that site is not in the HIZ BDD, because moving Big Al’s is “essential” to a project in the business district. And check out number 8: “relocation costs.” Who do we know in the HIZ BDD that would be relocating? Number 7 should give us all pause: “financing costs.” I shudder to think what could be included under that item.

    Bottom line, raising the total estimated project costs figure means that the City can borrow (i.e., issue bonds) up to that amount and use HIZ BDD tax revenues for repayment. But HIZ BDD revenue has already been promised toward the repayment of the proposed Wonderful Development $37 million bond issue (if/when that ever comes to fruition). Nowhere does the City show that it could afford this increase in project costs, given our outstanding commitments for that same pot of money.

    Remember, if there isn’t enough revenue from the HIZ BDD tax and HIZ TIF revenues to make the payments on the Wonderful Development bonds, guess where they will get the money to repay those bonds? That’s right: the general fund. If you’ll recall, the City is planning to issue general obligation bonds for the Wonderful Development, which will be backed by the full faith and credit of the City of Peoria.

There is more to the expansion of the Hospitality Improvement Zone than meets the eye. The City Council and staff should disclose to the public why they want these changes and what they will mean to our financial situation so that the public hearing process can be as productive as possible.