Economic Development Committee approves reimbursement plan for Kabul House restaurant
February 23, 2017
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A new proposal to reimburse Kabul House for all its liquor and tax revenues up to $50,000 is being moved for approval in City Council following an Economic Development Committee meeting Wednesday.
Kabul House is an Afghan restaurant scheduled to open at 2424 Dempster St., the former site of Chicken and Waffles, which closed in April 2015. It had previously applied for a $50,000 storefront modernization grant, but the application was denied at an Economic Development Committee meeting on Feb. 1.
The new proposal would provide the restaurant with up to the amount requested in the original modernization grant application, assistant city manager Marty Lyons said at the meeting.
Additionally, city documents show a clawback provision in the proposal that would require the restaurant to operate in Evanston for at least five years. Otherwise, it would owe the city the money it requested.
Ald. Ann Rainey (8th) said she supports the proposal if it acts as a rebate paid out by the city after a year of operation.
“I support it as a rebate,” Rainey said. “They pay it in and we rebate it.”
Lyons said it would be possible to front the money to Kabul House and forgive it as the revenue comes in, or work with a milestone or reimbursement to help the restaurant with funding.
The money — without which Kabul House could technically still open — would go toward advertising, employee hiring, training and kitchen equipment. If the reimbursement proposal falls through, the restaurant would have to take cuts in those areas.
Mary Beth Berns, chair of the Zoning Board of Appeals, praised the incentive.
“It’s genius what you’ve come up with — I can’t say how much I love it,” Berns said. “You’ve actually given them an incentive to push alcohol. If they push alcohol, they can pay off those rebates, and they can pay that money back sooner.”
Kabul House would also have to commit to hiring Evanston residents for part of its planned 20-person staff expansion to help the city further its local employment goals, Lyons said.
The reason for the original grant’s denial follows the current rules of the city’s modernization program, which dictate that no one property can receive more than one grant from the city in a 10-year span. Chicken and Waffles, the previous owners of the Kabul House property, applied for such a grant in 2012 and were approved, according to city documents.
That approval disqualified Kabul House from receiving grant money from the city until 2022. Because the city ended up losing money from the loan to Chicken and Waffles, officials were reluctant to accept a new loan that technically violated its regulations.
Ald. Melissa Wynne (3rd) defended the decision to reject the proposal at the last meeting, saying case-by-case analysis could cause inequities.
On Wednesday, however, Wynne and other committee members supported the new reimbursement proposal submitted by city staff.
“This program, this rebate idea, is an excellent one,” Wynne told The Daily after the meeting. “It incentivizes them to improve the business and stay in business.”