As value of Illinois 15 project increases, Belleville panel OKs doubling tax incentives

This is an artist’s rendering of the Hofbrauhaus brew pub planned for a complex off Illinois 15 in Belleville.
This is an artist’s rendering of the Hofbrauhaus brew pub planned for a complex off Illinois 15 in Belleville. Provided

The developers planning the Hofbrauhaus, hotel and restaurant complex on Illinois 15 want Belleville to more than double their tax incentive package to an estimated $32.36 million because the project’s value has nearly doubled to $90 million.

And if the project takes off, the city’s share of sales tax revenue from the complex is expected to double to about $1 million annually, up from the initial estimate of $500,000.

Belleville’s Economic Development and Annexation Committee on Wednesday night unanimously approved changes in the development agreement with the Keller family of Effingham.

Earlier this year, the City Council agreed to a series of tax incentives worth $15.69 million when the developers planned one or two hotels and the project was valued at $50 million. Now, they are considering four hotels.

“If they don’t fill those hotel rooms and if they don’t sell what they project, they don’t get” the tax incentives, Mayor Mark Eckert said. “They don’t get any of this until they perform.”

Eckert described the estimate of the city’s share of the sales tax revenue as “conservative.”

“Right now on that land, we’re getting zero,” Eckert said.

The city’s Finance Committee will consider the proposal on Thursday and the City Council, which has the final say, would then vote on the plan Tuesday night.

Here’s a breakdown on the amended development agreement:

▪  The developers would get four percentage points of the hotel and motel sales tax revenue generated at the site, where they hope to build four hotels. They would receive this for 20 years after each hotel opens.

This is contingent upon the city increasing the hotel and motel tax from 5 percent to 8 percent. A proposed soccer park complex would receive 2 percentage points of the hotel tax produced on the site and the city would get the remaining 2 percentage points.

▪  The tax increment financing district would give the developers property tax rebates of $6 million if two hotels are built along with the Hofbrauhaus, convention center and four upscale restaurants. If two additional hotels are built, this rebate would increase to $8 million, or $1 million for each new hotel.

▪  The business district established on the site allows a 1 percent sales tax to be collected at the complex and the developers would keep all of this revenue for 23 years.

As part of the agreement, Belleville plans to extend sewer lines to the project.

Meanwhile, the developers and the city are waiting for a decision from the state Department of Commerce and Economic Opportunity on whether Belleville’s enterprise zone can be expanded to include the Keller family’s site, which is located across from the National Shrine of Our Lady of the Snows.

If this is approved, the developers could save more than $1 million in sales tax breaks on the purchase of construction material.

On another front, the city is considering giving $5.5 million in hotel and motel sales tax revenue to Kansas City-based Game On Sports Development for the construction of a soccer/multi-sport complex next to the Hofbrauhaus site. This complex is valued up to $13 million and would have 11 soccer fields and a restaurant. It is expected to host regional soccer tournaments that would attract visitors from throughout the Midwest, and they are expected to stay in the hotels developed by the Keller family.

The city’s Finance Committee is expected to vote on the soccer complex plan Thursday night, and the City Council would consider it on Tuesday night.

The Economic Development committee also OK’d a proposed amendment to the development agreement with Replacement Services, which has renovated the old YMCA building at 15 N. First St. Replacement Services, which assists insurance company handle jewelry claims, will spend $170,000 for remodeling. The city will allow the developer to qualify for a sales tax break of an estimated $5,346 on the purchase of building materials. Also, the city will sell the parking lot at 125 W. A St. to the company for $25,000 and the city will pay for half of the $26,000 in sidewalk improvements necessary for compliance with the Americans with Disabilities Act.

Contact reporter Mike Koziatek at or 618-239-2502. Follow him on Twitter: @MikeKoziatekBND.

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