CITY OF QUINCY
RETAIL INCENTIVE PROGRAMS

Section 1.     STATEMENT OF PURPOSE
To provide criteria for identifying situations where it is desirable and suitable to provide public incentives for private development of the City’s retail sector.  

Section 2.     GOALS AND OBJECTIVES
The City of Quincy recognizes that a varied retail sector is an important component of a livable and vibrant community. Quincy relies on sales tax revenues to support the General Fund. To provide the level of services necessary to remain a vibrant and livable city, the sales tax base must continue to grow. The goal of this policy is to help ensure that Quincy continues to be a regional retail center by supporting retail businesses that:

A. Expand the City’s retail trade area; 
B. Increase sales tax revenues through direct sales; 
C. Increase property tax revenues to the City and other local taxing districts; and 
D. Diversify the local economy by encouraging a variety of retail stores to enhance the shopping experience. 

Section 3.    RETAIL INCENTIVE PROGRAMS 
A.      Specialty Retail Program 

The City seeks to recruit new and retain existing unique specialty retailers that draw shoppers to Quincy and expand the retail trade area. The Specialty Retailer Incentive serves the City’s desire to attract and retain unique, quality retailers not already serving the market. Developers attracting and retaining unique and specialty retailers are eligible for an annual sales tax reimbursement incentive. Specialty retail incentives are to be applied to existing retail developments and stores for redevelopment and renovation. New construction is ineligible for these incentives. Specialty Retail Incentives are targeted to the following types of retailers: 

1.      Destination retailers

a.    Have the capability to attract customers from outside the City;
b.    Do not have another existing location within a twenty (20) mile radius of the City;
c.    Fit well into the existing retail economy and provide a new and different shopping experience;
d.    If the applicant is a retailer within the downtown, a mall or a strip center, the project must contain at     least two thousand (2,000) square feet.

2.      Expansion, second location and relocation of existing retailers:

a.    Meet the criteria set in Section 1. above (subsection b.) other store location does not apply;
b.    Expansion – added square footage must be a minimum of fifty percent (50%) larger than current store.
c.    Relocation from one retail location to another retail site without fifty percent (50%) enlargement is not an eligible use of retail incentives. 

3.      Developers and store owners leasing space to destination retailers may apply:

a.    To qualify for the incentive, specialty retailers are required to sign a minimum five (5) year lease with the developer/store owner, no matter which party is the applicant and potential recipient of the incentive.

B.      Retail Redevelopment Program

The Retail Redevelopment Program is designed to provide an incentive to existing retail shopping centers and other retail stores that need redevelopment improvements in order to increase sales and enhance the tax base. The Program is retention based, with the goal of rehabilitating interior spaces (fixtures and finishes) as well as exterior aesthetic or architectural appeal to improve retail sales. Developers/retailers improving retail buildings are eligible for an annual sales tax reimbursement incentive.

1.      Acceptable categories of improvements include:

a.    Upgrading or enhancing store interior spaces (fixtures and finishes).
b.    Exterior improvement costs including façades, doors, windows, signage, painting, lighting and awnings.
c.    Center redevelopment:  mixed use/offices or services are permitted but the retail uses and resulting sales shall be the predominant and primary use of the center.

2.      Eligibility Criteria:

a.    The retail center or facilities must be older than twenty (20) years;
b.    Do not have another existing location within a twenty (20) mile radius of the City;
c.    Stand-alone building redevelopments shall be at least five thousand (5000) square feet;
d.    Multi-tenant developments: If the applicant is a retailer within the downtown, a mall or a strip center, the project must contain at least two thousand (2,000) square feet;
e.    A mix of office, entertainment and service uses is permitted but the retail uses and the resulting sales are required to be the primary use of the center or store.  For purposes of eligibility, the primary use shall mean at least sixty (60) percent of the space shall be dedicated to retail.
f.    Relocation from one retail location to another retail site is not an eligible use of retail incentives. 

C.      Vacant Retail Anchors

The Vacant Retail Anchors Program provides grant monies to aging retail facilities. The program is designed to encourage retailers to reuse vacant anchor stores in excess of 50,000 square feet.  Partial use of vacant anchor space for a new retail is eligible for incentives however the retail tenant shall utilize sixty percent (60%) or more of square footage for retail.     

1.      Acceptable Categories of Improvements:

a.    Demolition of existing anchor space and build-out of new lease areas;
b.    Costs to upgrade or enhance store interior space (fixtures, finishes, floors, common areas);
c.    Exterior improvements costs including façades, doors, windows, signage, painting, lighting and awning;
d.    Acquisition of real estate adjacent to vacant retail anchor stores to permit retail expansion.  Assurance must be provided that the vacant retail anchor space will be fully utilized for retail prior to city support for real estate acquisition.

2.      Eligibility Criteria:

a.    Retail use;
b.    For profit, sales tax paying businesses;
c.    Private investment shall exceed the amount of grant funds given by the City for tenant improvements;
d.    Applicant may own the real estate in which the business is located. Alternatively, the applicant must have a fully executed lease with a term of not less than five (5) years;
e.    Retailer must have projected annual total gross retail sales of four (4) million dollars by the third year of operations;
f.    A mix of office and/or service uses is permitted but the retail uses and the resulting sales are required to be the primary use of the center. For purposes of eligibility, the primary use shall mean at least sixty percent (60%) of the space shall be dedicated to retail.
g.    Relocation from one retail location to another retail site without fifty percent (50%) enlargement is not an eligible use of retail incentives.

Section 4.     MINIMUM APPLICATION REQUIREMENTS
Every retail incentive application will be evaluated on individual merit and overall contribution to the City’s economy. An applicant may submit, if eligible, for more than one retail incentive.  An applicant may submit for a stand-alone retail business or a development that includes multiple retail businesses. Retail incentives are for existing building and retail center developments. New retail store/center construction on greenfield sites are ineligible for retail incentives. Meeting the application requirements described herein does not guarantee that incentives will be approved. The following requirements (recognizing that a proposal may address some but not all requirements) will be used to evaluate whether a particular proposal may qualify for incentives.

Section 5.     SUBMISSION OF RETAIL INCENTIVES PROPOSALS
Applicants for retail incentives from the City must submit a proposal to the Planning and Development Department that includes, at a minimum, the following:

A.    A description of the type of retail business and projected annual sales.
B.    Identify the specific project’s location for the retailer.
C.    Certain financial disclosures from the applicant that may include certified bank letter of support, personal guarantees and or summary tax return information.
D.    A description of the plan for the development including a timeline for construction, hiring and operation.
E.    If proposing exterior improvements submit façade rendering/drawings of the building improvements.
F.    An estimate of the capital investment that corresponds to any phasing for development and expansion.
G.    The number and position of new and part-time employees.
H.    A narrative description demonstrating how the applicant meets and/or exceeds both the specific incentive eligibility criteria as well as the general eligibility standards.   

Section 6.     EVALUATIONS OF PROPOSAL’S
A Retail Incentives Committee (RIC) will evaluate the public purpose served by the proposed development using the following criteria:

A.    Comparison of private dollars invested to the amount of public dollars requested;
B.    Project site and building(s) have remained significantly unoccupied or underutilized for at least one year (this criteria does not apply to retail expansion projects);
C.    Project will serve to further the development of adjacent areas;
D.    Project will increase sales and property tax revenues;
E.    Project is expected to create or retain job opportunities;
F.    Project will strengthen the retail sector of the city;
G.    Nature and scope of improvements to be constructed by retailer/developer.

Section 7.     LIMITS ON RETAIL SALES TAX REIMBURSEMENT INCENTIVES
Should the evaluation of the proposal determine that the proposed retail project meets the goals and objectives of this Ordinance and other requirements stated herein, the calculation of the sales tax reimbursement is subject to the following limits:

A.    City retains the first twenty (20) percent of Retailer Occupation Tax imposed pursuant to 35 ILCS CH. 105 (municipal sales tax) received from Illinois Department of Revenue generated from the site.
B.    After the first twenty (20) percent of municipal sales tax, the retail incentive shall be no more than seventy five (75) percent of municipal sales tax.  
C.    Maximum term of annual sales tax reimbursement incentive payments are ten (10) years.
D.    All sales tax reimbursement will be made on an invoice-reimbursement basis only.
E.    Property owner, developer or retailer shall not be entitled to any retail incentive resulting from sales from a retailer who relocated to new lease area from within the corporate limits of the City unless tied to an expansion except under  Specialty Retail Eligibility Criteria 2. b.

Section 8.     METHOD OF CALCULATION OF SALES TAXES REIMBURSEMENT

Section 9.     LIMITS ON VACANT RETAIL ANCHOR GRANT INCENTIVES

A.    Annual amount of reimbursement is subject to the City’s annual appropriation of sufficient funds in the City’s fiscal year (May 1 to April 30) budget.
B.    Grants shall be a preapproved and shall be made on an invoice-reimbursement basis.
C.    Grant amounts shall be limited to $1,000,000 per retail store/center/mall/owner or developer.

Section 10.     PERFORMANCE STANDARDS
Any company receiving retail incentive funding will be required to enter into a development agreement. Each development agreement will vary based on the specific project, but all such agreements shall set forth specific performance goals (i.e. gross retail sales) and consequences to the company not meeting such goals. For example, a retailer’s failure to generate sufficient sales as projected over the allocated period may result in the retailer not being fully reimbursed, (i.e. the retailer would forfeit the remainder of the incentive).

Section 11.     MONITORING AND EVALUATION COMPLIANCE
A company entering into a development agreement must submit quarterly reports (due the first Friday of July, October, January and April) to the City’s Comptroller’s Office for review. Verification shall consist of copies of sales tax returns (ST1 Form) actually filed by the retailer operating from the new lease area with the Illinois Department of Revenue or such other information as the City may deem reasonable to assure accurate reporting. These reports must demonstrate the progress the company has made toward the performance goals outlined in the development agreement. City staff will use the quarterly reports to conduct an annual compliance review.

Section 12.     APPLICATION PROCESS FOR RETAIL INCENTIVE PROGRAM

A.    Contact the Planning and Development Department, City of Quincy at 217-228-4515.
B.    Pre-Application conference with P&D Department staff to review request for incentives.
C.    Initial Application fully completed (see section of retail incentive proposal) and submitted to the P&D.
D.    Reviewed by Retail Incentive Committee (RIC).  RIC will determine project eligibility and feasibility and recommend project funding.
E.    P&D prepares development agreement for City Council Finance Committee review and recommendation.
F.    Resolution authorizing development agreement submitted to City Council.

Section 13.    RETAIL INCENTIVE COMMITTEE:  A Retail Incentive Committee is hereby created and shall consist of five members.  Members shall be appointed by the Mayor, with advice and consent of the City Council.   One member shall be the Mayor or a city official designated by the Mayor. Two members shall be members of the City Council. One member shall be the City Treasurer. One member of the public shall be the community representative. All members shall be appointed for a four-year term or until their successors are appointed. The Mayor shall be the Chair of the Committee.

Section 14.    PREVAILING WAGE: The recipient of public funds may have prevailing wage apply to all or part of a redevelopment project.  The recipient of city funds will be solely responsible for compliance with any applicable labor standards.

Section 15.   EFFECTIVE DATE: Ordinance  No. 20-04  was approved 2/25/20.