Hanging Out in Rockford: A personal journey—part 18

Tony Salamone (wisely, I think) backed out of the restaurant deal that was supposed to happen in the State and Main Auto Ramp Tower or Smart Ramp. That would not, however, deter the powers that were. They were determined to proceed, and a group of 12 investors was formed to open what would become the Main Event. Frank Schier was at the time running Harper’s Weekly, the bar that was where Swilligan’s is now in the Lafayette Hotel. Frank and I actively opposed the formation of this business.

Frank had a deal to buy Harper’s. He just had to get it to a place financially where it could stand on its own. The specter of 275 highly subsidized seats being dropped into the middle of what at the time was a fairly fragile downtown recovery was more than either of us could comprehend. We knew we would lose business to this behemoth. We did. Harper’s was forced to close.

We paid visits on the mayor, John McNamara, and on the general manager of the MetroCentre, Doug Logan. I can remember so clearly the mayor saying that often in a downtown renewal, the first people involved didn’t survive. You can imagine how that made us feel. We had our entire lives on the line, and we were being told that we might not survive and that it was normal. Normal, I guess, if you have nothing personally on the line.

By the time we called on Doug Logan I had filed a lawsuit against the MetroCentre. Doug indicated he had sued people and been sued by people, and he hoped that it didn’t preclude him from coming into my place for a Pepsi. I told him that it was very personal.

The parking ramp was built as a public/private partnership. This had first been done for the erection of the Oakland Coliseum. Taxing bodies do not pay taxes. They have, therefore, no depreciation. By creating a partnership between a public entity and a private concern, they sought to fool the system and create tax benefits out of thin air. The Congress of the United States moved shortly thereafter to close this loophole. There was a date in question where the scheme would have been illegal. I think they backdated the documents to avoid this outcome.

When the bids were let for the parking ramp, the bidders were required to buy into this gimmick. None of them had any faith in it, so they all simply inflated their bids to cover the cost. So we—as the public—paid a half million more for our parking ramp than we should have. The builder of the ramp was supposed to provide the extra half million needed to construct the restaurant, but there was a clause in the contract that let them out of this obligation if the restaurant wasn’t constructed by a certain time. It wasn’t. The Metro Authority tried to get around this by signing a contract for construction and alleging “substantial compliance,” but to no avail. The ramp builder didn’t have to cough up the money. They got to keep it.

My lawsuit was based on the clause in the Illinois constitution that public funds were to be used for public purposes only. Shades of today, what are “public” purposes. In today’s political climate, we wouldn’t stand a chance. Then things were somewhat different. Our lawsuit was a threat, enough of a threat that they had to cook up a special deal to generate the money to build the restaurant. They “swapped” the parking ramp for the building that is now Davis Park’s eyesore, the unfinished structure that they paint different colors to cover its ugliness. The parking ramp was sold on a 20-year interest only contract with a balloon at the end. Then it was leased back to the Metro Authority. The MetroCentre paid almost 15 times the tax fair market evaluation for the building in Davis Park. Half a million dollars of supposed “not public” money was generated to build the restaurant. And we could have had Northern Illinois University. What were they thinking?

The night of the opening of the Main Event, Frank Schier and I were driving down State Street. We were slightly under the influence. Infuriated by what we perceived as the arrogance of the city in constructing the new restaurant over our dead bodies, we briefly considered driving Frank’s old beat-up car in through the front window, rolling the window down and ordering cocktails. Obviously, we didn’t. You would have read about it.

More next week.

Mike Leifheit’s “Hanging Out In Rockford” reviews locally-owned restaurants, businesses and Rockford life. These columns are available on his Web site, IrishRoseRockford.com. Leifheit is owner of the Irish Rose restaurant in the downtown River District.

From the July 13-19, 2005, issue

Enjoy The Rock River Times? Help spread the word!