Complaint filed against the City of Marion, IL in connection to - KFVS12 News & Weather Cape Girardeau, Carbondale, Poplar Bluff

Complaint filed against the City of Marion, IL in connection to Illinois Star Centre Mall

(Source: KFVS) (Source: KFVS)
MARION, IL (KFVS) -

An attorney for the group that owns the Illinois Star Centre Mall in Marion, Illinois has filed a complaint against the City of Marion.

According to a news release, Paul Slocomb, special counsel for Illinois Star Centre, an Adversary Complaint "seeking an Equitable Accounting from the City of Marion as it relates to the financing of the Illinois Star Centre Mall and surrounding area in Marion, Illinois" was filed in the United States Bankruptcy Court on July 10.

The ownership group filed for bankruptcy in May. We reported in October of 2016 that the ownership group decided to put the mall up for auction.

Slocomb said he wants to review ordinances, financial documents, and bonds related to the financing of the mall because he believes they could reveal potential fraud. A managing partner for Illinois Star Centre, LCC, reportedly signed off on the complaint filing because they claim the city would not "voluntarily cooperate with the requests for additional financial information to determine what, if anything, was still owed on the bonds related to the development of the mall and surrounding area."

Here are the things Slocomb claims:

  1. There were several unexplained transfers, totaling several million dollars, out of designated accounts that were established to fund the development of the Mall and surrounding area,
  2. The City continues to Assess and Levy taxes on the Mall when it appears that all of the Bonds related to the development of the Mall and surrounding area have been satisfied.
  3. It does not appear that the Bond fund proceeds that were earmarked for the development of the Mall and surrounding area were used in accordance with the requirements of Illinois’ Special Service Area Tax Law.
  4. It appears that the City has improperly commingled Bond Fund proceeds.
  5. It appears that the City unfairly gerrymandered the Special Service Area established to fund the development of the Mall and surrounding area which unfairly burdened Illinois Star Centre, LLC. with all of the tax liability while arbitrarily excluding three of the four anchor stores and other surrounding businesses that clearly benefited from the improvements.
  6. It appears that the City assessed a 1% Sales Tax on the Illinois Star Centre, LLC property to retire a series of General Obligation Bonds even though the City previously enacted an Ordinance that specifically excluded such property from additional taxation.

In the release, Slocomb said that the additional information is needed because a potential buyer had been identified and the information is needed to "perform its due diligence."

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