Politics & Government
Village Board Approves Minor Changes To Developer's Agreement
Revisions will reduce federal tax burden for developer.
The Village Board unanimously approved Monday changes to the developer's agreement with Mandel Group, a developer that plans to build a $34 million in Shorewood.
The revisions reflect the Mandel Group creating the Kenmore Place 4041 Corp. to receive grant funds from the village and, as a result, avoiding a federal tax liability, according to Bruce Block, special counsel to the village.
The revision stems from an Internal Revenue Service requirement that grants recieved by a limited liability company are treated as taxable income, he told the CDA.
By creating the corporation, the Mandel Group avoids a 35 to 40 percent tax liability on the $5 million in developer grant funds from the village's Tax Increment District No. 4.
In addition, the revisions to the developer's agreement language reflect the developer paying $80,000 in bond issuance costs and an $80,000 reduction in the amount of a $4 million village grant.
The $34.81 million project will consist of a six-story building which will include retail space for Walgreens, 84 apartment units and two parking structures.
The changes to the developer's agreement were on Friday.
