Motor Werks And Des Plaines Honda Sign Expansion Deals In Barrington

Press release from the Village of Barrington:

At its regular board meeting on Monday, October 26, 2020, the Village of Barrington Board of Trustees approved two economic incentive agreements that will support expanding the Motor Werks of Barrington auto dealership and bring a new Honda motorcycle dealership to Barrington, both of which are expected to create new jobs and significant new sales tax revenue in the Village.

“Given the impact that Covid-19 has had on many of our businesses in 2020, this type of positive economic news in Barrington could not be more welcome at this time,” said Village President Karen Darch. “For over 50 years, we have had a very positive and productive relationship with Motor Werks, and we are pleased to be working to assist them with a significant expansion of their luxury auto dealership. We are also excited to welcome Des Plaines Honda to our area. This established dealership’s offerings of top-line motorcycles, watercraft, and all-terrain utility vehicles will address an unfilled market niche in Barrington’s business sector and bring much-needed additional sales tax revenue into the Village.”

Village Manager Scott Anderson added, “Because sales tax revenue from motor vehicle sales makes up approximately 25% of the Village’s general operating funds, these vehicle business expansions are an important step forward in promoting the economic health of Barrington, including in the Route 14 corridor. We could not be more pleased to be working so cooperatively with these two dealerships to expand our business base in Barrington.”

Motor Werks of Barrington approached the Village about its expansion plans in 2019, stating that their current operational needs have outgrown available land. Motor Werks proposed that the Village partner on an economic incentive agreement that would allow the dealership to purchase the Barrington Woods office complex at 18 E. Dundee Road. This acquisition will expand the dealership’s footprint by an additional 10 acres on the eastern edge of their property. The property could then be redeveloped to add a parking structure and vehicle reconditioning center, as well as to provide enough land for the potential relocation of its Cadillac brand from downtown Barrington, or to accommodate a new brand at the Barrington location.

Under the terms of the Motor Werks agreement, which has a 10-year term, the dealership will be entitled to retain 65% of all new sales tax revenue over and above an agreed-upon sales tax base of $2.7 million, which was calculated by taking an average of sale tax revenues from previous years. The Village will retain 35% of new revenue for the first 10 years and accrue 100% of the revenue once the agreement expires after that time. The first year of eligibility for the incentive will be 2023.

Des Plaines Honda will be located at the currently vacant properties at 1201-1203 S. Northwest Highway. These empty buildings currently generate no sales tax for the Village. The incentive agreement is based upon a 60% retainment of sales tax revenues for Des Plaines Honda up to a capped maximum of $375,000 in verified eligible capital site improvements. The term of the agreement is either the attainment of the $375,000 in incentive payments or ten years, whichever is sooner. The Village will retain 40% of sales tax revenues through the term of the agreement, and then 100% once the agreement has expired. Des Plaines Honda is expected to bring 20 to 22 new employees to the Village.

The Village of Barrington has historically worked with auto dealerships in Barrington who have requested similar capital expansion incentive agreements, due to the fact that dealers are some of the Village’s largest employers and generators of sales tax and are critically important to Barrington’s economic base.

President Karen Darch said, “We are confident that both dealerships’ capital investments will bring significant new sales growth to their businesses, and in turn, new sales tax revenues to the Village that we would not have otherwise enjoyed. Meanwhile, we are protecting the sales tax base we currently have, and after the terms are up, the Village will retain 100% of all sales tax revenue from both businesses. Coupled with these dealerships’ ability to bring new jobs to our community and new shoppers as well, we believe these partnerships are very lucrative and important steps for the Village of Barrington to take to continue to ensure the economic vitality of our area.”

This press release was produced by the Village of Barrington. The views expressed here are the author’s own.