A Publication of WTVP

James Baldwin is vice president of Parts and Service Support for Caterpillar Inc., with responsibility for parts distribution facilities throughout the world (23 facilities), and the production of all service training information, literature, parts book, and service development. Born and raised in Minnesota, he has a degree in industrial administration from the University of Minnesota. His early aspirations involved the publishing industry, as he worked as business manager for the University of Minnesota’s Minnesota Daily the largest college newspaper in the world at the time. He interviewed in the newspaper industry, including at the Chicago Tribune, before he decided on a career at Caterpillar. With 36 years of service at Caterpillar, all but three of those years have been spent living in Peoria. Most recently his local visibility has centered around his position as chairman of the Riverfront Business District Commission, the body established by the City of Peoria to oversee development of the riverfront.

What prompted you to accept the chairmanship of the Riverfront Business District Commission, taking on so much additional work aside from your job as a Caterpillar vice president?

It was Peter Korn who explained to me what the city planned to do with the Commission, moving from the committee that Leonard Marshall headed (the Steering Committee that developed the whole plan which we are still following, with modifications) to the Commission. The idea was for responsibility to be handed to the Commission, a group of people to make decisions on the riverfront. They wanted to get it out of the “political arena.” After I agreed to serve on the committee, they asked me to be the chairman and I think got involved with the selection of some of the people.

When I accepted the job, it was not because of any pressure from Caterpillar. I talked to my boss about doing it and he said, “Fine,” with all of the typical qualifications like, “you still have a job to do at Caterpillar.” The company was very supportive of it.

I knew the job would take a lot of time. The mayor said the job would take a couple of hours a week, and I knew that was a bunch of baloney. I knew it would take a great deal of time, and my wife and I discussed it at some length before a decision was made.

The primary reason I took the job was that I had been working in various and sundry ways for almost 20 years to do something about the deterioration of Peoria Lakes. Having come from Minnesota, the “Land of 10,000 Lakes,” I couldn’t believe when I got here over 30 years ago, you couldn’t even put your foot in the river because it was so polluted. Thankfully, the pollution problem was addressed with clean water regulations. I have been involved through the Tri-County Planning Commission and, more recently, through the Heartland Water Resources Council, in trying to do something to make a difference to save Peoria Lakes, however. If we don’t do something, they are going to continue to disappear.

I felt that by getting more and more people to the riverfront – exposing people to the beauty and natural resources of the river – it would be easier to get people involved in saving Peoria Lakes. After some 20 years, I had seen a few more people become involved, but not the mass of people we needed to stir something up.

The river will always be here; the U.S. Army Corps of Engineers will take care of it. It will be about 300 feet wide and will constitute about 2000 acres between Peoria and Chillicothe. But there are some 14,000 acres of lakes that are going to disappear if something is not done. There are ways to solve this problem, and we are doing some things, but not enough.

I thought this was a way to address the issue, because riverfront development would see people investing money. When people invest money in something, their interest level gets raised. I felt it would really help people to get close to the river and become familiar wit hit. This riverfront development plan does that.

The second reason I got involved was the fact that the riverfront was nothing but a parking lot and a lot of weeds. Much of the land was owned by the city and I felt we could do something to make it a better place. So I accepted the chairmanship of the Commission. It has been a very rewarding experience. I think we have made a big difference in a very short period of time.

By all estimates, riverfront development is ahead of schedule. What factors have been key to the successes to date?

Development of the RiverFront is absolutely ahead of schedule. We are doing some things now that we were talking about doing five years into the plan.

One obvious factor in the success of the plan has been the support of the Peoria City Council. Without the level of support we have had from the City Council – the lack of second guessing and lack of changing plans – it wouldn’t have been possible. Through the ordinance passed in setting up the Commission, they basically gave us the responsibility for the Riverfront Business District which extends from the Bob Michel Bridge to the Detweiller Marina, and from the Illinois River to Adams Street. They said, “We want to dramatically improve that whole area, basically following the plan that has been developed. Modify it if needed, but we want you to implement the plan.”

The Commission has all the authority for the riverfront development decisions with the exception of condemning land or going into debt.

The support we’ve had from the City Council is why it has moved forward so fast. It’s been a great relationship.

It appears, for the first time, that the general public really believes that riverfront development will happen. In the past, some grandiose plans did not come to fruition. Why the difference?

The big difference is that the current plan is doable. The Demetriou plan, even back when it was developed, involved billions of dollars. It was too ambitious for an area the size of Peoria.

By starting out as we did, with the just-completed park area, we have demonstrated to the public and to private investors that we are going to proceed. The park is done; we are now going to start on the Riverboat Landing, then move into the RiverFront Village. These things are going to happen and people can see that. The second thing is that it shows the quality we expect. We have demonstrated that the things built along the river are going to be first class.

Bids for the Riverboat Landing are planned for August, with construction beginning by September, and completion (hopefully) next year. This will be the next major segment of development and will include the Gateway Recognition Center, which will have a banquet hall. The area currently occupied by The Landing will be completely redone. Riverboat Landing will include a marina, the first phase of which may be completed this Fall.

People now see that we are going to deliver; it’s affordable. That’s why the private investment is beginning to be generated.

Developing a private-public synergy can be a fragile thing, leveraging public dollars to in turn stimulate private investment. That chemistry has gone tremendously well so far, hasn’t it?

The cooperation between the City of Peoria and the Peoria Park District has been unbelievable. These are the types of things that make people really believe that we are going to make something happen. The Park District and the City developed an intergovernmental agreement. The Park District contracted the construction of the park, and they are going to maintain all of the public areas of the RiverFront. They will be providing additional levels of security over and above that provided by the Peoria Police Department. They are scheduling all events happening on the RiverFront (some 90 events this year and 200 next year). This intergovernmental agreement has demonstrated to private developers that we are going to pull it off.

The infrastructure being built has set the tone for the RiverFront Village. It has begun to bring people to the RiverFront. It has stimulated the interest of the private sector. That’s why David Bielfeldt is looking at developing the Foster Gallagher building into condominiums, for example. We are beginning to see interest in renovating many of the older, surrounding buildings into office complexes.

People used to shy away from the area surrounding the RiverFront because it was rundown. Now they are saying, “Hey, this is going to be first class; this is where we want to be!” You see an example of that with Simantel relocating to the area, and with Kurt Huber renovating the building for the technology group on Washington Street. That particular building had a tree growing out of it! There are many other similar buildings which can be renovated, like the iron front buildings on Washington Street, for example. Preston Jackson’s art gallery is probably unique to downstate Illinois. Things like the gallery and the Antique Mall are bringing different kinds of people to the RiverFront. I think people are now beginning to see that it’s the place to be. These are the kinds of things we really want on the RiverFront.

It’s obviously much more complex to develop the RiverFront than other sections of town. What are the major development hurdles and regulations that have to be overcome?

The most obviously thing is that about half of the fist block up from the river is in the flood plain. Therefore, any construction has to be elevated. That’s the reason RiverFront Village has to be elevated, with parking underneath the buildings. It’s not easy to develop, given these restrictions, but we have been able to accommodate them.

Of course, anytime you begin to alter things along the river, you are dealing with the U.S. Army Corps of Engineers. They Corps of Engineers has been fantastic. They have given us the permits for The Landing, the marina facilities and the floating restaurant pads, and everything. They have done a super job of knowing when to say “yes” and when to say “no.”

I would say the only problem we have had is with the State of Illinois, which obviously has some responsibility. The waters of Peoria Lakes are owned by the state. The river is controlled by the Corps, but outside the channel it is principally state-controlled. The states has been very reluctant – no the legislators, but the bureaucrats. It’s like they would really like to stop the whole thing because it’s not their idea and not their thing. That’s been very frustrating for us and for the developers. I know Mike Wisdom and Monte Brannan are going through problems concerning the deck to the brewpub, which extends out over the river – “publicly owned land.” Therefore you have the concern that private industry is infringing on publicly owned property. To me it seems kind of simple, but I guess it isn’t.

Ray LaHood has been very supportive, along with all of the state legislators. Sometimes they have to get involved to help us with the projects. Usually it’s always with state government.

As public dollars are being used as a catalyst for private investment in the RiverFront, one example of a public-private agreement is the deal with Bud Grieves to continue operating The Landing, to be relocated a block north of its current site. The plan involved a long-term lease of city property in return for the operation of the Spirit of Peoria riverboat. There have been some complaints from a group of bar owners that the deal constitutes favoritism and an unfair advantage for Grieves.  What are your thoughts on this issue?

A brief history lesson on the issue is probably in order. The Par-A-Dice gave the Spirit of Peoria riverboat to the City of Peoria when it relocated across the river. The City and the Park District ran the board for a year. Nothing much happened; the riverboat wasn’t used very much. They knew the minute they put it out on the river they would start losing money. It became very clear that operating a riverboat by itself was not financially feasible. The City Council felt they had to get rid of the boat, so they put it out for bids. They got two bids – one from Bid Grieves and G&G Packet, and one from a company out of the Quad Cities. I’ve talked to the attorneys that looked at the bids and they have said the one from the Quad Cities was basically smoke and mirrors; they wanted to invest nothing and were going to ask for tax dollars to fund the operation.

Bud Grieves proposed, after looking at the books of the riverboat’s operation, a plan to get something to subsidize the operation of the riverboat. His plan was to lease The Landing at a favorable rate so he could make money from the combined income of The Spirit of Peoria, the Katie Hooper restaurant and The Landing. That’s the reason the combined deal was made, a deal which extends through 2003. Grieves has the right to buy the boats for $750,000 through this October.

The deal probably would have stayed like it is, except we needed to move The Landing further north to accommodate the RiverFront Village project and to fit it into the Riverboat Landing project. So we had to reopen the contract. The key is, we must have the riverboat for the RiverFront. We don’t want to lose the riverboat. So we knew we had to put together a package to entice Grieves to move and make The Landing area better. We wanted a long-term lease because we don’t want him to be able to get out of it. On the other hand we have great faith that we are going to be successful, so we want to participate in the profits.

In 1995, the total income from Grieves’ combined operation of the Spirit of Peoria, The Landing and the Katie Hooper was $650,000 – constituting a loss of $250,000. We said we thought he could begin to make a profit at around $1 million.

Grieves will be investing $1.1 million in buying the boat and in The Landing infrastructure. Beginning with $2 million in income, he will start sharing with us 10 percent of the income from the three operations (15 percent after $2.5 million). If we do our part and make this very successful, we will get significant income from the operation. In the meantime, he has to pay taxes on the board, HRA taxes, and all of those types of things.

There has been concern from other tavern owners. They wanted the boat and The Landing split up. Nobody wants to have anything to do with the boat, but they would really like to have a piece of The Landing. They realize it’s a great opportunity by itself. But the whole idea of The Landing in the first place was to keep the boat. So we can’t separate the two, because we want the boat to remain. The tavern owners were also concerned about a planned 50-year lease agreement on The Landing. Bud has already agreed to cut that back to 25 years. We don’t want it to be less than that, because we want to know a riverboat is going to be there.

Grieves took a tremendous risk when he agreed to take over the operation. Nobody else wanted it. Now they want to divide it all up. My point to other operators is, The Landing isn’t the only enterprise available on the RiverFront. In fact, it will only operate six months out of the year. I’ve told them they can go three hundred feet away and lease something from Mike Wisdom and have a 12-month operation.

The RiverFront Village will try to attract some retail shops to the RiverFront. Obviously the hope is that the RiverFront will bring new retail downtown, not just see existing area retailers moving. What is the potential for attracting new businesses?

Mike Wisdom and Monte Brannan have really put together an outstanding package to sell Peoria and the RiverFront. They have put together a great story including the Peoria Zoo, Wildlife Prairie Park, the Civic Center and the other things people might come to see. They have targeted the T.G.I.F.s and Bennigans, the ice cream and candy shops, the novelty shops, and the other types of things you would expect in that kid of setting. Most of their marketing efforts are geared toward getting outside businesses to come to Peoria.

Restaurants are one key component, and restaurants love to have competitors next to them. One restaurant is hard pressed to survive by itself; six restaurants are fantastic because they draw people in. I think once one or two restaurant chains from outside the area locate on the RiverFront, you will see people who operate one or more restaurants out of Peoria want to locate a restaurant there also. One local restaurant has already expressed an interesting opening an additional outlet, for example.

None of the proposals I have seen so far have been Peoria businesses wanting to move; they have been from people wanting to open new enterprises on the RiverFront.

When do you think we will start hearing specific names of companies, retailers and restaurants that plan to locate on the RiverFront?

I’m sure the names will come out yet this year, whether actual construction begins this year or next year. The plan is for construction of the floating restaurant pads at RiverFront Village to begin this year.

The Commission is really part of the holdup. We have to figure out a way to get enough parking for the area. We can build the first pad and still use existing parking. But when we start building the second complex of buildings, we are going to need new parking. The only place it can come from is the Sears blocks.

The Sears relocation issue is an example of how interrelated the various aspects of the RiverFront are. So many desired projects depend on something else happening first. What is it like trying to manage such a huge project where so much is interrelated?

You have to ask for a lot of tolerance from the Commission and the City Council; even more so, you have to ask for a lot of tolerance from the developers. We’re working basically with a staff of three full-time people: Tom Tincher, Hedy Veach and Susan Grant – employees of the City but responsible to the Commission. They have to balance all of these things. There are several projects that we should probably be working on that we are not, just because we really don’t have the needed staff. And while we may not react fast enough for some people, I don’t think we’ve lost any business.

The balancing act is fantastic. For example, parking is one of the main needs. We are currently looking at several options adjacent to the RiverFront.

The Sears scenario is another one of those balancing acts. The Sears blocks are owned by the Peoria Development Corporation, made up of a number of local organizations. The Riverfront Commission, long-term, would like to develop a parking deck there. The existing parking deck has to be torn down; it cannot be salvaged. We need about 2300 parking spaces in the two Sears blocks.

The long-term plan is also to have private developers build two towers on the current Sears property – which could include office space, residential space, or public use space. We can’t do anything at present, however. Sears’ lease runs for about another two and a half years; then they have two five-year options. One scenario certainly could be that Sears would say they want to stay there, in which case we would want to dramatically improve the facility they have. We don’t think they want to stay there, however; we think they want to go someplace else. So probably in about two and a half years, there won’t be a tenant in that building, and that would be the appropriate time for the City to take some action, either on its own or with a developer, to acquire the land and begin a project that would fit into the overall RiverFront plan. But we really have to wait and see what Sears is going to do. In a way, they really kind of hold the cards because they do have a lease. But I think their plan is to move.

You mentioned the potential for the development of the city-owned Foster & Gallagher building by David Bielfeldt’s Anchor Corporation, a project which would depend on a deal involving the Bielfeldt-owned “Bergner’s block.” What is proposed in that regard?

We’re very close on the Foster & Gallagher building. However, the project is tied to the Bergner’s block because there would be some trading of land. David Bielfeldt’s Anchor Corporation owns virtually the whole Bergner’s block with the exception of the Kellstedt’s store. The current plan is for David to maintain ownership of the Liberty Plaza building (the old Montgomery Wards building) and to tear down everything between it and the Bergner’s building. This would make room for a parking deck, with shops on the ground floor and offices on the top floor. Then the Bergner’s building would hopefully be restored to its original look (taking the sheer metal off the outside).

The idea is to put a Technology Center in the Bergner’s building. The idea for the Technology Center has been around for about a year. It involved District 150, Bradley University, Illinois Central College, The University of Illinois School of Medicine at Peoria, the Private Industry Council, and some other groups. The plan is to have a center where people can upgrade their skills in the computer sciences. The original plan was to locate the center in the Sears building, assuming that Sears would relocate. With that being uncertain, the group is looking at the Bergner’s building. Working through the Riverfront Development Corporation, they are looking for a developer for the center. They only need a couple of floors of the building.

The plan for the Foster & Gallagher building includes condominiums of various sizes and styles, from loft condominiums to three- and four-bedroom penthouses. The zoning and permitting has all been approved. What remains to be done is a trade of land: a segment of the Anchor Corporation-owned Bergner’s block for the city-owned Foster & Gallagher building. Such a deal would commit the Anchor Corporation to develop the Foster & Gallagher building.

Upscale, downtown residential space has been available since the early 1980s in Peoria, with the construction of the Twin Towers. The demand has not been great. Are you convinced that the additional amenities the entire RiverFront project will bring will stimulate residential interest in the downtown area?

I think it will. David has done a lot of research on it. His conclusions are that you must have an influx of people working downtown to stimulate residential space. The key, then, would seem to be the planned development of office space. The close proximity of proposed residential space to all of the other things – including restaurants, small shops and entertainment – will be key as well.

What message would you like to give the business community concerning RiverFront development?

I see a tremendous amount of private development opportunity that hasn’t even been touched. For example, the Winkler building is owned by the city; we would love to have someone develop that. There are half a dozen buildings to develop on Washington Street. There are plenty of opportunities. Developers should look at getting in early because, if we are successful, those properties will do nothing but go up in price. This is the time to get involved.

It’s also important to remember that we have basically only talked about three or four blocks of the RiverFront, that portion which will be the first to be developed and which is closest to the downtown. The RiverFront extends another mile beyond the Murray Baker Bridge. We are going to build a sports complex, for example. We have asked the Peoria Park District and private developers to take a look at that. We need additional indoor ice facilities, as well as facilities for soccer, roller-skating and so on. Plans are also in place to build an entertainment center and amphitheater adjacent to the sports complex. The amphitheater will hold 5,000 people, with the state on a barge on the river.

You are accustomed to working in the private sector where generally things move at a much faster pace and more decisively than they do in the public sector. How frustrating has it been for you to oversee the Riverfront Business District Commission? How long do you see yourself involved as a chairman of the Commission?

I can’t say I don’t get frustrated. When you understand that this is all being done in public trust and everyone has a chance to review things, the fact that there hasn’t been more frustration is remarkable. Frankly, I couldn’t go to the next level and serve in public office. I couldn’t’ stand to be a mayor or councilman and go through the tremendous amount of detail required in that arena. I think that is one reason the City Council set up the Riverfront Business District Commission – to separate riverfront development from some of the minute scrutiny of every decision.

I went through the Chamber of Commerce’s Leadership School 30 years ago. I said at the time I would someday do something to give back to the community. I guess I’m doing that now. It does take a lot of time. I had to wait until my kids were grown.

I will continue to do what I’m doing as long as I’m wanted and as long as I’m having fun. IBI