Des Plaines looks into buying Sim's bowling alley
Des Plaines city officials are considering buying the former Sim's Bowl and Lounge downtown to spur future redevelopment.
The matter was discussed during the closed portion of a recent board meeting. While no details about a potential property purchase were revealed in open session, the city council voted 5-3 to move ahead with negotiations with Midwest Bank to purchase the site at 1555 Ellinwood Ave.
Aldermen Patricia Haugeberg, John Robinson, Jean Higgason, James Brookman and Mark Walsten voted to move ahead with negotiations on Sim's. Aldermen Rosemary Argus, Matt Bogusz and Dan Wilson were against it.
Midwest Bank took over Sim's on June 7 from the Caparelli family that had owned and operated the bowling alley and adjacent cocktail lounge and Depot Pizza for 55 years.
With dwindling customers, the family no longer could afford to pay a $925,000 mortgage and real estate taxes on the roughly 27,000-square-foot property.
Des Plaines' purchase price would be just shy of $1 million, should officials decide to make the deal.
Some aldermen agree that's a good price for the property, but not everyone on the council likes the idea of the city dealing in real estate.
Third Ward Alderman Bogusz said buying any piece of property in this economy is a bad idea, especially considering the city's financial situation.
The city is eliminating roughly 40 jobs and raising various taxes and fees next year to fund operations and cut a more than $5 million deficit down to $1.4 million.
"Des Plaines does not have a good track record as a Realtor or developer," Bogusz said. "We need to prove our solvency before moving forward on any property acquisition. If a serious flood hit Des Plaines tomorrow, we would have to go out for a loan to pay for the sandbags. In that reality, we cannot afford to extend ourselves."
The city may use money from the downtown Tax Increment Financing, or TIF, District No. 1 and take on additional debt to purchase Sim's, officials said.
Alderman Haugeberg, in whose 1st Ward Sim's is located, said there is no harm in investigating the matter.
"It doesn't cost anything to look into it, and why not, if it could be a good move on the part of the city," she said. "It would be a much better deal in purchasing this particular property versus decisions in previous years where the city has lost money. Fortunately, TIF No. 1 is probably doing the best out of all the TIFs."
TIF No. 1 currently has $537,000 available after officials transferred $855,000 from it into adjoining TIF No. 5 to make that fund positive, said Dorothy Wisniewski, city finance director.
Wisniewski said the debt payment for TIF No. 1 will drop by $1.2 million at the end of 2011 when a portion of the bonds are paid off. She added, the city could take on additional debt and structure it so repayment begins in 2012.
Haugeberg said there could be other possible uses for the vacant Sim's site in the interim and the city could make money selling the property to a developer.
Eighth Ward Alderman Argus said the city could be stuck with the Sim's property for a long time, if the economy doesn't turn around or a developer doesn't step forward.
"I know it is TIF dollars, but still, it's real money," she said. "Especially (since) we just laid off 40 people. We had to raise taxes. So I felt it was not appropriate at this time."
Argus said beyond the purchase price, it would cost the city roughly $100,000 to raze Sim's and turn it into a parking lot, one idea for the site until redevelopment occurs. That could potentially earn the city $30,000 yearly in parking fees, which didn't seem worth it to her.
"I just don't think that we should be land banking, especially at this time," Argus said.