Chicago Bears and school districts tangle over taxes for potential stadium property in Arlington Heights

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The Chicago Bears and a trio of school districts whose financial resources stand to be affected by the football team’s proposed redevelopment of Arlington International Racecourse in Arlington Heights are deadlocked over how much the Bears should pay in property taxes for the site.

Team President and CEO Kevin Warren said in a May 4 letter to three school district superintendents that their proposal of a $95 million valuation for the property is a “nonstarter” and “not viable.” The valuation would result in the Bears paying $7.9 million in yearly property taxes.

“This is an excessive sum for property that will sit idle and will have no commercial use for at least the next two years,” Warren wrote.

The Bears countered by proposing annual tax payments of $4.3 million and called for a return to the negotiating table.

Warren’s May 4 letter, obtained by Pioneer Press, addressed collectively to the superintendents of Palatine Community Consolidated School District 15, Arlington Heights-based Township High School District 214 and Palatine-based Township High School District 211, marks the most recent skirmish in a monthslong back and forth about property taxes the Bears would pay to local public schools as they seek to develop the 326-acre former horse racing venue.

The superintendents have said the school districts would likely see an increase in student population should the football team move forward with the proposed sprawling, approximately $5 billion mixed-use commercial and residential development. But, school leaders said, district resources could take a hit if the team prevails in its request for a lowered property tax bill or frozen taxes via establishment of a tax increment financing district.

The superintendents collectively wrote a reply letter to Warren dated May 12 stating that they see their suggested $95 million valuation for the former racetrack as a fair pitch.

“We do not see the need to make a counteroffer at this time,” their letter reads.

The Bears first agreed to purchase the property known as Arlington Park for $197 million in fall 2021 and closed on the property in February 2023.

The school districts that pull property tax revenue from the site have been following developments closely since at least May 2022, when District 15 Superintendent Laurie Heinz wrote to Arlington Heights village leaders and encouraged them to not establish a TIF district to support the Bears’ pitch.

Leaders from each of the school districts have said they support the Bears’ move from Soldier Field along Chicago’s lakefront to northwest suburban Arlington Heights but have been leery of the proposed development’s impact on their districts’ respective property tax revenues.

The Bears had previously asked Cook County Assessor Fritz Kaegi to value the property at $37 million. For tax year 2022, the assessor’s office valued the property at $197 million.

Kaegi’s reassessment of the land value would raise the team’s property tax bill to $16 million, up from $2.8 million when the property was in use as a racetrack.

That assessment is being appealed. A hearing is scheduled for June 2 before the county Board of Review.

In the meantime, the school districts suggest the land valuation be $95 million, according to the correspondences.

“It is our firm belief that this offer provides the clarity and fairness CBFC Development needs, while maintaining the integrity of the property tax system on which school districts depend and protecting other taxpayers within our communities who do not receive such large reductions in their assessments,” the superintendents’ letter reads.

Additionally, District 214 spokeswoman Stephanie Kim said $95 million represents a possible “reasonable compromise” between the assessor’s estimate and the Bears’ ask.

The team recently filed paperwork with the village to demolish the historic grandstand at the racetrack.

Warren argued in his letter that the earliest the site would have commercial use would be 2026. He called on the districts to reach an agreement with the team on the value of the land.

“There is no property in the surrounding Northwest Suburban Area that pays property taxes anywhere close to this,” he wrote. “The time is now to close the deal on this immediate short-term tax issue in a way that is mutually beneficial and enables all parties to focus together on the future and give this project the best chance of moving forward.”

The team “has a sincere interest in being a valued member of the community and paying our fair share of taxes during the planning period and, if we are able to redevelop the Arlington Park Property, in the long term,” Warren wrote.

School district leaders have said they continue to support development at the site and plan to meet with the team over the summer.

“The School Districts fully support the redevelopment of the Arlington Park site, but will not support a taxpayer subsidy for the Bears that is in any way detrimental to local schools,” they said collectively in a statement to Pioneer Press.

In addition to direct school district-team negotiations, the three districts worked together to hire a lobbying team to try to shape the outcome of proposed legislation circulating in Springfield that would create a 40-year public financing structure for the redevelopment project and a payment in lieu of taxes, or PILOT, to the school districts to make up some anticipated lost revenue.

With just days to go in state legislators’ spring session, neither Senate Bill 1350, its companion bill in the House nor a third proposal from state Rep. Marty Moylan, D-Des Plaines, has advanced in the legislature.

Also, Moylan recently filed House Bill 610, which is similar to an earlier version he filed in April. And former village trustee and now freshman state Rep. Mary Beth Canty, an Arlington Heights Democrat, has signed on as a co-sponsor of the most recent version of Moylan’s bill.

Canty called the measure “a step forward, but by no means final” and said her co-sponsorship represents “support for continued discussions with all stakeholders engaged.”

Arlington Heights Village Manager Randy Recklaus said Canty’s sponsorship did “not necessarily” reflect village support for the measure and said the village was still reviewing the new proposal.

“We will be continuing to speak with Rep Moylan, Rep. Canty and other contributors,” Recklaus said.