Schaumburg Convention Center to lose $15.7 million in 2009
December 12th, 2008 | by Brian Costin Published in Blog, Corporate Welfare, Features, Taxes | 12 Comments
Can this pork-barrel spending be eliminated?
***Update***Per the proposed 2010 Convention Center & Hotel budget the 2009 losses ($5,742,000) exceeded the original estimate of $2.2 million. The 2009 taxes collected $5,887,612 were less than instead of the anticipated $6,885,838. total losses to taxpayers totaled close to $18.4 million for Schaumburg taxpayers in 2009.
On Wednesday, December 10th, 2008, the Chicago Tribune reported that the Schaumburg Village Board Members have “approved the Convention Center’s 2009 budget, which anticipates a $2.2 million loss for the year. Spending for unfinished construction accounts for most of the gap, officials said.”
With a little good, old-fashioned investigating, the Schaumburg Freedom Coalition has found out the reality for Schaumburg taxpayers is much, much worse. The Schaumburg Freedom Coalition has learned that in order to achieve even a modest $2.2 million dollar loss, the Schaumburg Convention Center is commanding huge sums of taxpayer money to pad the books favorably.
$6,885,838 in taxes are budgeted to be collected in 2009 for the Schaumburg Convention Center. These collected taxes go directly to the Schaumburg Convention Center Fund and are separate from general Village tax revenue. The following is the breakdown of where these taxes will come from:
- $1,362,460 – 5% Amusement Tax. Placed on consumers movie theaters, baseball games, musical performances, and game rooms across Schaumburg.
- $1,381,528 – Village-Wide Hotel Tax. It’s interesting that other competing hotels in Schaumburg are forced to directly subsidize the Convention Center and Hotel.
- $2,075,394 – Telecommunications Tax. Every cellular or land-line phone user in Schaumburg is paying corporate welfare to the Renaissance Corporation.
- $2,066,456 – Direct Hotel Taxes. The Convention Center and Hotel gets to keep the taxes its competitors must pay.
- $6,588,874 – 100% Property Tax Exemption. The property tax burden is shifted to other taxpayer’s to make up for the lost revenue.
The Schaumburg Convention Center and Hotel project is failing our community miserably. The project’s projected losses for 2009 is almost $15.7 million, of which $13.5 million comes from increased sales and property taxes. Currently, Schaumburg’s interest-only loan expense is $11.4 million per year. Starting in 2011, Schaumburg’s loan payment obligations will increase every year to a max of over $21 million in the loan’s final year of 2041.
To stop this project from becoming an economic sinkhole, the Schaumburg Freedom Coalition calls for the sale and privatization of the property, the retirement of the outstanding debt, and a large reduction in the sales and property taxes for the citizens of Schaumburg.
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December 13th, 2008 at 7:16 PM (#)
Mr. Costin,
I would suggest you do your “homework” a little more as your facts are incorrect. The residents of Schaumburg do NOT pay property “0″ to the Village of Schaumburg. So given that your posts are totally incorrect. It appears to me that you just like to attempt to get people upset & attempt to cause problems. Try playing chess it’s a much better hobby. I also hope you find happiness in your life as it appears you’re a very unhappy person.
Note: See the Schaumburg Freedom Coalition’s response to this anonymous and misleading post in the comment below.
Reply
December 15th, 2008 at 10:03 PM (#)
Captain,
Your statement is incorrect and I have done my homework. The Village does impose a property tax. The Village collects property taxes in the Olde Schaumburg Center TIF district. There are a number of special service districts in which Schaumburg collects a property tax on. All of this information was found in the 2008 Schaumburg Comprehensive Annual Financial Report which can be found at http://www.ci.schaumburg.il.us/vos.nsf/schaumburg/PAFR-6DKQ7X .
The Convention Center is one of the biggest properties in Schaumburg but it pays no property taxes at all. This is because the Village of Schaumburg applied for and received a special property tax exemption for the property. It is also the only hotel in Schaumburg that pays no property taxes.
Based on the $228 million dollar value of the property, it is receiving a property tax exemption of $6,588,874 per year. This exemption makes property taxes higher for everyone else in Schaumburg. The special property tax exemptions at the Airport and the Baseball Stadium are also examples of how the Village makes property taxes higher for everyone else.
This Schaumburg Convention Center exemption means that the taxpayers of Schaumburg are paying almost $6.6 million more per year in property taxes directly as the result of the actions of the Village Board.
Chess is a fun game to play as a hobby, but when the politicians in Schaumburg are treating the citizens and businesses of Schaumburg as chess pieces in real life I will do everything possible to get the people of Schaumburg educated, upset, and cause problems for the politicians that are taxing and regulating our Village to death.
Reply
January 13th, 2009 at 12:48 AM (#)
[...] Coalition has advocated for a large scale reduction of government debt by privatization of the Schaumburg Convention Center & Hotel, Alexian Baseball Field, and the Schaumburg Airport which account for the lion’s share of the [...]
January 18th, 2009 at 5:54 PM (#)
This is a joke. There is no way they will get any decent shows that draw. Come on – Great Waters Fly Expo, Illinois Professional Turf Conference…are you kidding me? Just look at the website this whole thing is goofy. Rosemont, Navy Pier, McCormick etc. have this area locked up. Most educated people knew this thing would flop big time.
Reply
Brian Costin Reply:
January 18th, 2009 at 9:37 PM
There is an easy way to find out if a project is sustainable. See if the market will provide it. If businesses are unwilling to build a convention center & hotel of that scale on their own then it is a pretty safe bet that it isn’t going to be sustainable.
Unfortunately, some politicians get illusions of grandeur and decide that they are going to force the taxpayers to subsidize their pet project with tax dollars.
In this case the Village Board and Mayor Al Larson didn’t even bother to ask the people of Schaumburg if this is something they wanted to do. The Village of Schaumburg has abused their home rule powers.
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January 19th, 2009 at 11:13 PM (#)
[...] these tax increases if they didn’t engage in their corporate welfare practices at the Schaumburg Renaissance Hotel & Convention Center that will cost Schaumburg Taxpayers $6.9 million in sales taxes and nearly $6.6 million in a [...]
February 20th, 2009 at 11:47 PM (#)
[...] these tax increases if they didn’t engage in their corporate welfare practices at the Schaumburg Renaissance Hotel and Convention Center that will cost Schaumburg taxpayers $6.9 million in sales taxes and a nearly $6.6 million property [...]
May 9th, 2009 at 10:31 PM (#)
[...] with budget expenditures in the $10’s of millions for corporate welfare projects such as the Convention Center, Schaumburg Flyers, and the Schaumburg Airport that the Village is cuttting the budget on the [...]
July 15th, 2009 at 12:05 PM (#)
Clearly, the politicos in Schaumburg think just like Mayor Daley. They have greater concerns over their Legacy than financial responsibility or concern for the tax payers. The Schaumburg Convention Center, The Wise Rd. project, The Schaumburg Flyers, The Schaumburg Airport, The Rec Center, The High School expansions with the related decorations that serve absolutely NO PURPOSE! This is the “Ego Stroke”. Politicians building so that they can say “They created it.” Further, the “Favors” that come back to them from all of the contractors involved! If only we could throw them all out and start over…with single term limits and absolute accountability. Serious jail time for those that devalue our community though irresponsible spending and corruption! The Greatest Legacy would be fiscal responsibility and a well run community WITHOUT all the fluff!
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August 12th, 2009 at 7:59 AM (#)
[...] 12% restaurant sales taxes or 10% retail sales taxes Corporate Welfare (Schaumburg Convention Center, Airport, or Professional Baseball Team). Government Transparency Fiscal Responsibility Red [...]
September 29th, 2009 at 8:52 PM (#)
[...] remember the Schaumburg Convention Center & Hotel, that she says the Olympics will help fill, costs area taxpayers $15.7 million per year in increased property & sales taxes. 16 days of Olympic glory doesn’t justify a lifetime [...]
November 21st, 2009 at 11:02 PM (#)
[...] pointed out a plethora of great ideas to cut unnecessary and wasteful spending, including the Hotel & Convention Center, Airport, and Baseball Stadium, which combined cost area taxpayers over $10 million per year to [...]