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DeKalb seeks delicate balance Legal protections sought while courting Internet retailer By KATIE DAHLSTROM kdahlstrom@shawmedia.com DeKALB – DeKalb city leaders are trying to draft an incentive deal to attract Internet retailers while protecting the city from what some officials said is an inevitable lawsuit. The agreement in question is between the city and shell corporation Great Lakes Economic Development, which represents an undisclosed retailer. The agreement is designed to entice Internet retailers to open an office in DeKalb in exchange for the city giving back 85 percent of the sales tax revenue it collects on internet
sales. Aldermen discussed the agreement last month, but are now trying to figure out the best language to safeguard the city. City Attorney Dean Frieders said the city staff will ensure that agreements with individual retailers meet new state guidelines that went into effect Jan. 1, but cautioned aldermen there is some volatility with the rules. “We also think it’s very likely that there will be a lawsuit challenging an agreement of this nature,” Frieders said. The challenge, according to a memo from Frieders to City Council members, would
likely come from the Regional Transportation Authority because the agreement would convert what is now use tax – a significant portion of which goes to the RTA – into local sales tax. The RTA, the umbrella organization that oversees the Chicago Transit Authority, the Metra commuter rail service and the Pace suburban bus service, is suing Sycamore and Genoa contending that American Airlines, United Airlines and Petroliance are avoiding paying its retailers’ occupation tax in Cook County by running what the lawsuit claims are a sham offices in
those cities. The DeKalb agreement entails an online retailer opening an office in DeKalb. The retailer would have to meet three of five requirements at their DeKalb location: accept sales; have salespeople solicit orders; tender payments or send invoices; locate tangible inventory; or locate headquarters. If the retailer meets three of those requirements, the sales tax from online sales would go to the city of DeKalb. The city would require the retailer to get a letter from the Illinois Department of Revenue indicating the deal meets state reg-
ulations, Frieders said. In turn, the city would rebate 85 percent of the sales tax back to the retailer. Of that, 50 percent would go to the undisclosed retailer and 35 percent would go to Great Lakes, a company set up by Tom McPeak, a partner with Atlanta-based Barnwell Consulting. The sticking point of the agreement is whether it should include an indemnification clause that would require Great Lakes and the retailer to cover the city’s legal costs should the RTA or another entity sue, as well as cover any damages in case the city loses. The other option, which
McPeak proposed, was to create an escrow account that would mean Great Lakes could not touch its share of sales-tax revenue for one year in order to provide funding in case of a lawsuit. Mayor John Rey said this week he is strongly in favor of the indemnification clause because it provides the city more protection. The city staff will negotiate those terms with McPeak before bringing an agreement to council. “I’m not asking you to take any risks,” McPeak said. “I’m asking you to give some agreements that I can take to the retailer.”
University chiefs: Rauner budget cuts would be dramatic Governor proposes cutting higher education funding by $400 million By KERRY LESTER The Associated Press
Photos by Danielle Guerra – dguerra@shawmedia.com
Army Spc. Alan Cugler, 20, hugs his sisters Trinity Ingalls (left), 13, and Katrina Ingalls, 11, on Thursday at Sycamore Middle School after surprising them. Cugler returned home from Djibouti.
A joyous reunion Brother returns from Africa to surprise sisters at school More coverage
By DARIA SOKOLOVA dsokolova@shawmedia.com SYCAMORE – Sycamore Middle School eighth-grader Trinity Ingalls was listening to her teacher’s talk about work etiquette and career choices when she suddenly saw the brother she hadn’t seen for nine months. As one of the middle-schoolers said he wanted to be a Marine, Trinity’s brother, Army Spc. Allan Cugler, showed up from around the hallway corner clutching two stuffed animals. After nine months serving overseas with the U.S. Army in Djibouti, Cugler, 20, wanted to surprise his sisters, Trinity and Katrina, who didn’t expect him back until Christmas. “I think I can introduce myself,” Cugler said as he walked into the room. “And I know there’s two people who really want to see me.” Cugler said he spent two months in basic training in Fort Sill, Oklahoma, before
For video of the reunion, log onto Daily-Chronicle.com. ceived many letters from people from around the country, but when Trinity and several of her classmates wrote to him on Veteran’s Day, it was a big deal. With the help of their mother, Penny Ingalls, and school officials, he devised a plan to make a surprise appearance in the middle of the Cugler breaks down after talking with his sister Katrina Ingalls on school day. “It was really touching Thursday at Sycamore Middle School after he surprised his two siswhen you guys wrote to us,” ters. Cugler said. “When deployed, you don’t celebrate stuff – you his field artillery unit was Ingalls, 11, a fifth-grader at don’t celebrate Christmas, deployed to Djibouti, a small West Elementary School in New Year’s. You stick it out, country near Ethiopia in the Sycamore, jumped up and em- you get it done. You are there, Horn of Africa. There, Cugler braced Cugler. Their mother, you see Africa, you are fightprotected a drone base for the Penny Ingalls, who was sitting ing, doing things you don’t Air Force, helped to support nearby, started to cry. Cugler want to do.” U.S. missions and train Af- and his sisters held one anothGetting letters from sturican soldiers. He returned er in the middle of the hallway dents at the school “was amazto Sycamore on Wednesday as more than 100 students and ing, [it] gave me hope to see night. staff members applauded. Trinity, 13, and Katrina Cugler said he had re-
See REUNION, page A6
SPRINGFIELD – Presidents of three state public universities told lawmakers Thursday that GOP Gov. Bruce Rauner’s proposal to cut higher education funding by nearly $400 million would lead to significant setbacks at campuses that would reverberate for years. The officials from Western, Southern and Eastern Illinois Universities told a Senate panel that the cuts – a 31 percent reduction in state funds to each school’s budget – respectively, to each of their could not be offset by drastic tuition increases, a move they feared would drive down enrollment and essentially force the schools to function as pri- Gov. Bruce Rauner vate entities. “We will not put this on the backs of our students,” Eastern Illinois President William Perry said. Calling next year’s proposed $13 million in cuts for the university “too much to swallow all at once.” Instead, he urged lawmakers and school officials “to reason together for the fiscal year 16 budget.” If such a budget was passed by lawmakers, Perry said the school would do its best to adapt – paring down student programs and services and cutting as many as 250 faculty and staff positions. “It’s going to be tough, but the key is that the long term effects of this are going to be the most significant,” he said. “Four or five years from now, you would see some more difficult effects in competing for faculty, competing for professional staff.” The $400 million in higher education cuts – roughly 31 percent – are part of the governor’s $32 billion budget proposal presented last month. The
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plan aims to bridge a $6 billion budget gap – next year without raising taxes. Along with higher education, Medicaid would see a $1.5 billion cut under the plan, and state aid to child welfare programs and local government funding would be significantly reduced, among other areas. Rauner has said that universities will need to look at their own budgets and have built up staff, along with bureaucracies over the years, noting he will give them flexibility with the cuts. But the university officials said Thursday that the plan would cut the institutions to the bone marrow. Southern Illinois University President Randy Dunn said a proposed $44 million cut to the Carbondale campus and another $20 million cut to the university’s Edwardsville campus would jeopardize some of the school’s “signature majors” including its flight school and pharmacy program. Dunn said the reductions could also force as many as 1,000 course sections to disappear. “If we don’t see a mitigation of what has been proposed, this budget will roll back our state support to a level we haven’t seen in 30 years,” Dunn said. Western Illinois University President Jack Thomas said a $16.5 billion dip in funding for the school would not only prevent the school from keeping pace with other competing schools, but would also blunt the university’s role as an economic engine for the 16 county region, which he said provided roughly $377 million in revenue annually. He urged lawmakers to “recognize the unintended consequences of such a drastic cut.” Rauner’s proposal is merely a starting point in what is expected to be a months-long negotiation with Democrats who control the General Assembly, and top Democrats have signaled that it may be a difficult battle.
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