URBANA — City council members on Monday night gave preliminary support to paying incentives out of city coffers for two renovation projects in different parts of town that officials say should bring more business and jobs to Urbana.
One project to bring a cafe and "creative co-work space" to the 200 block of West Main Street in the heart of downtown Urbana is exactly what city officials had hoped to see in that area, said city economic development manager Tom Carrino.
Matt Cho of Cake Design Development LLC has asked for city assistance in renovating the two Main Street buildings . The buildings, which are primarily vacant and being used for storage, are owned by Busey Bank and are located between Corson Music and Siam Terrace.
Cho would be eligible for city reimbursement of 20 percent of his renovation costs, up to a maximum $70,000. According to the memo, officials expect the project will end up costing Cho a total $750,000.
Council members supported the plan.
"I think it's kind of expensive," said Dennis Roberts, D-Ward 5. "We're being very generous to developmental requests, and I hope that these are all justified in the future."
But he also praised the project and said he hopes the businesses take root and stick around for a long time.
"I think that this feels like kind of a really nice mix for our downtown, and I hope it brings good youthful energy to the community," Roberts said.
City officials expect the additional sales tax generated when the two businesses open will cover the cost of the reimbursements after six or seven years.
In a second redevelopment project, which drew less discussion but still had the council's support, Frasca Associates says it plans to expand its flight-simulator business and Frasca Field Airport  near the intersection of Cunningham Avenue and Airport Road.
Officials will have to finalize their support of both projects at their next city council meeting.
The Frasca project would include renovations of existing facilities, expansion of one building and construction of a new 12,000- to 24,000-square foot facility.
The city would rebate 60 percent of the property-tax revenue generated by the expansion during the next 10 years. That rebate would be capped between $275,000 and $425,000, depending on the final cost of construction.
According to the memo, officials expect the extra tax revenue generated by the project would cover the cost of the rebates after 12 or 13 years. Frasca Associates says the expansion will provide room for 40 more employees during the next five years, and city officials think the project would increase local economic output by more than $14 million annually when it is completed.