United Airlines would receive a $5.4 million subsidy from the Central Loop tax-increment-financing district -- and up to $10 million more in gas tax rebates -- thanks to an incentive package advanced Monday to defray the cost of moving its corporate headquarters to 77 W. Wacker from Elk Grove Village.
United is spending $22.9 million to rehabilitate 137,000 square feet of space of the Loop office building as a combination corporate headquarters and sales center.
To stave off the embarrassment of having O'Hare Airport's flagship carrier move its corporate headquarters to Denver or San Francisco, Mayor Daley crafted a generous incentive package to help finance the move.
On Monday, the City Council's Finance Committee approved the deal, which calls for United to receive a lump-sum $5.4 million TIF subsidy in the first quarter of 2008.
The city has agreed to a five-year fuel tax grant that would be capped at $2 million per year. It would be triggered only after United has purchased more than 265 million gallons of fuel in a given year. That would guarantee the city budget $13.2 million in gas tax revenue.
United also has agreed to contribute $100,000 for riverwalk improvements along Wacker Drive.
"United has one year from completion to relocate 330 full-time equivalent jobs . . . and create 35 new full-time equivalent jobs," and maintain 325 jobs for 10 years, said Assistant Planning and Development Commissioner Jeff Streeter.
The city's offer includes $4.4 million in tax-increment financing if the airline relocates downtown, according to a source familiar with details of the plan.
The incentives package also includes $5.3 million of city tax increment financing and $1.4 million of state infrastructure and employee-training grants.
The nation's second-largest carrier, a unit of UAL Corp., has been shopping for a site since spring, when it said it was looking to consolidate its facilities.