Focus of Champaign council's talks on 'The Yards': Who'll pay for what?


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CHAMPAIGN — An expansion of the Illinois Terminal. A potential Division I hockey team. Another downtown hotel. Conferences. Residential properties. Induced development.

All were talking points at the first of three study sessions Tuesday night regarding a proposed hockey arena, hotel and residential building called The Yards in the southern area of downtown Champaign.

The Champaign City Council; Core Spaces, a Chicago-based company partnered with developer Hans Grotelueschen; the Champaign-Urbana Mass Transit District; and the University of Illinois were the major participants in the discussion, and the partners hope to have a development agreement by January.

Questions remain about who is going to pay for what is now an estimated $200 million project, and what exactly the contributions will be from each partner.

Pressed by council member Clarissa Nickerson Fourman about financing an expansion of the Illinois Terminal, MTD Managing Director Karl Gnadt said that such questions are "putting the chicken before the egg."

"We don't know what it will cost until we have the money," Gnadt said. "The reality is, we have to know how much money we will have available first and then adjust the scope of the project."

Right now, he said, the MTD has applied for two federal grants to fund the project.

Gnadt said the award announcement for one may come as soon as next month, but the other might not be until the spring or later.

As far as what the city will contribute to the overall project, planning director Bruce Knight said he wants to limit it to parking and miscellaneous public works needs. He added that most of the money for that will come from tax increment financing, which would redirect future property-tax revenue to subsidize the project.

Council member Alicia Beck wanted to know about parking and its impact.

Knight responded that most of the infrastructure work for the area has already been done in anticipation of development there, but added that it will mean there's not much more the city can do.

He warned that there will be congestion and that the roads in the area, particularly Logan Street, where a new viaduct was built, cannot be expanded further.

For council member Angie Brix, the issue is ownership: Will The Yards be owned by the university, like similar developments in other college towns? Or will it be a mix of the developer, the university and the city?

The answer, according to the MTD, the UI and the developer: We're still working on that.

Beck said that's also the most important piece for her.

"We need to look at what we're going to be losing in terms of financials in the future," she said. "What land is going to be contributing to this TIF? And what are we going to be putting into the TIF?"

She noted that three of the four partners in the project are public entities.

"There's no tax revenue there," she said. "I don't want us to be put into a position where we're giving a lot of our other tax revenue away, that we're not giving away everything that comes along with development. The reason we want development to come is because we want additional money for our coffers."

Council members Will Kyles and Fourman also wanted to know how the developer will take into account a policy recently codified by the city to contract minority- and female-owned businesses for these kinds of projects.

"I pretty much echo the cautious optimism here," Kyles said. "We need to be making sure we have great community input and communication. And now that we have this policy, that's great and it's a big deal, but the big piece is actually enacting the policy. So I look forward to seeing that."

Community input Tuesday night was mixed.

Kati Churchill, who coaches the Illini Figure Skating Club, said she and people around her have been excited about the prospect of the arena.

"I know from our perspective, we would be able to host much larger events," she said. "This would be like a 'Field of Dreams' situation: If you build it, they will come."