Under the settlement, the village will become a small-scale developer and property owner. It will buy the Amoco property, build a new restaurant for Tasty Dog operators Mike and Rob Barton and lease it to them.

Tasty Dog has been operating for more than 20 years in a building slated to be replaced by an 18-unit apartment building with 6,000 sf of retail space on the first floor. Euclid Terraces LLC, a partnership between Northfield, IL-based Focus Development Inc. and Skokie, IL-based Taxman Corp., also will build a 522-car garage, 37 town houses and a 32-unit condominium building. The development is just east of the village's Oak Park Avenue retail area and north of Metra and Chicago Transit Authority commuter rail stops.

The project is expected to generate an additional $650,000 a year in property and sales tax revenue. The village threatened to condemn the Tasty Dog property under its eminent domain powers to make way for the development. The deal calls for cash to the current Tasty Dog's location's owner, Greg Frigo. Terms of the deal will be released this month.

"We are very pleased to have reached a negotiated settlement," says outgoing village president Barbara Furlong. "Fortunately, it was not necessary to proceed with the eminent domain process to achieve the village's desire for a negotiated settlement."

The Amoco site was considered previously but neighboring property owners complained it would bring noise and litter. Furlong and Trustee Joanne Trapani, running Tuesday for Furlong's post, met with neighbors and assured them the village will take steps to prevent such problems.

The construction of the new Tasty Dog will be the last part of the development, expected to begin some time next spring. The Amoco site will be leveled and paved to provide temporary parking during construction of the parking garage. Antunovich Associates, which is designing the Euclid Terraces project, also will design the Tasty Dog building.