* I always have a problem when someone wants to blame all woes on just one factor. That being said, noted TIF-hater Ben Joravsky predicted this on Oct. 25th…
I suspect the bulk of the [Olympic Games] will be financed with money from the city’s TIF accounts. That’s why Daley’s proposed tax hikes are so critical. TIFs work by freezing the amount of property tax revenue the parks, schools, county, and other taxing bodies can draw on. As property values rise, the TIF funds get all the additional tax money the property generates. By calling for a hike in the property tax rate, Daley’s accelerating the amount of money pouring into TIF funds at the same time he’s looking to impress the IOC with Chicago’s ability to pay for the games—a master stroke.
* And, yesterday, the city unveiled a new plan…
City Hall Wednesday took the first formal step toward acquiring property that now is home to Michael Reese Hospital — a 37-acre site that could figure prominently in the city’s plans to host the 2016 Summer Olympics.
* And the kicker…
The city also did not specify how it would finance acquisition of the land, which is located west of Lake Shore Drive between 26th and 31st streets. But the property is included within the Bronzeville tax increment financing (TIF) district.
* Joravsky responds…
It’s also next to the 47th and King TIF, the 40th and State TIF, the 41st and King TIF, the 35th and State TIF, and the 43rd and Cottage Grove TIF. State laws governing TIFs allow the city to “port” TIF funds — that is, move TIF money from one district to an adjoining one. Including Bronzeville, these TIFS had about $19.3 million in their accounts as of last December.
Remember, TIFs are property tax dollars diverted from the schools and parks and county into slush funds controlled by the mayor. He could use them to rebuild the CTA, hire more teachers, or help offset the city’s $196 [million] deficit, which instead has him calling for a $300 million increase in property taxes and fees. Instead, he’s pouring money into his pipe dream.
Enjoy the games, my friends.
Perfect.
LIVE session coverage...
- j - Friday, Nov 2, 07 @ 9:12 am:
Did somebody say TIF reform?
- Anon - Friday, Nov 2, 07 @ 9:19 am:
Rich, I wish other media outlets would report at the same level of sophistication as you do. In addition to this post, which is far too complex for any Chicago news outlet to report on, not one news channel on yesterdays CHicago news reported that the Speaker didnt have the votes to pass the regional sales tax plan.
Wouldnt it make sense when reporting a story to give all the relevant facts? When reporting that the solution to the transit mess is the regional sales tax, it would make sense to mention that this plan lacks the votes necessary to pass.
With this, it is time for the media to call on Madigan to display some leadership on this issue. If he’s holding out for a sales tax increase that wont pass, and mass transit in chicago collapses, he is the one to blame. It is time for him to listen to the other leaders and pass the gaming/capital plan which will fund infrastructure projects throughout the state and will save mass transit.
No more games, Mr. Madigan.
- And Still.... - Friday, Nov 2, 07 @ 9:25 am:
folks are OPPOSED to Recall? Wow!
- j - Friday, Nov 2, 07 @ 9:26 am:
Can everyone now stop calling the Hamos/Madigan tax increase “the only viable plan”?
Are we allowed to now start asking people what they think about the Cross plan?
Time’s a wasting!
And here is the magical thing - You could get the Cross plan passed, and then still do a sales tax increase in the RTA region to fill the hole. But you could wait and do that until January when you only need 60 votes!
- tom73 - Friday, Nov 2, 07 @ 9:27 am:
It is this kind of “progress”–that is, help out everyone and everything but regular residents, even as essential daily services decline–that has made me regret ever moving to Chicago, the most overrated big city I’ve ever lived in or visited. This place has become a sick joke, and I look forward to leaving in the next year or so, when my career moves to the next level. I am amazed at how many of my friends and former coworkers have already left or are making concrete plans to leave, fed up with the way things are going and worried that things will just get worse, especially as Daley chases those Olympic rings, and our state govt keeps shooting itself in the feet.
- Niles Township - Friday, Nov 2, 07 @ 9:30 am:
Anon - Jack Conaty over at Fox, probably the most underevalued political reporter in the city, did say Madigan did not have the votes, and might not even call for a vote because of it.
On the TIF-Funded Olympics…this is my problem with this whole venture. For the next 10 years all we are going to focus on is a two week event instead of the massive amount of reform and reconstruction this state needs.
- Carlos C. - Friday, Nov 2, 07 @ 9:33 am:
Sure hope the Olympic Committee is watching Illinois and Chicago antics.
- Cassandra - Friday, Nov 2, 07 @ 9:33 am:
And yet….these are not secret TIF’s presumably.
Maybe the good citizens of Chicago like things this way. They have shown little evidence to the contrary.
Of course, the rest of the state shouldn’t have to
pay for Chicagoans’ freespending ways. That means they should pay for their own CTA bailout which includes maintaining a luxury-level overpaid CTA civil service full of connected Dem hacks. It’s fine to be spendthrifts, but not if the suburbs and Downstate have to bail you out.
That means, keep that sales tax increase in Chicago.
- plutocrat03 - Friday, Nov 2, 07 @ 9:34 am:
Don’t forget rhe Chicago Reader story from a few weeks back talking about Tifs and the potention of the City to go bankrupt as a result of them.
I do find it telling that the money appears to be there in Chicago to fund their own problems, but folks are willing to go to this level obrinksmanship to have people outside Chicago pay for their problems.
- Levois - Friday, Nov 2, 07 @ 9:37 am:
As much as I want to see the Olympics come to Chicago, I wonder if it’s that worth it. I should look into these TIFs.
- ZC - Friday, Nov 2, 07 @ 9:50 am:
Anyone who wants to read more about TIFs, google-search for Mike Quigley’s 2007 piece “A Tale of Two Cities” online. It will get you some stats.
That said, does anyone have an estimate for how much money the feds might kick in, if Chicago gets the Olympics? How much money did DC give Salt Lake City? Atlanta? We’ll probably be talking a Democratic White House and Congress here, come 2009, with many key Democrats in positions of influence in the Congress at least (Rahm, Jan, Jesse, Durbin), so that should all be factored in. TIF money won’t be the only thing funding the Olympics if Chicago gets it.
- j - Friday, Nov 2, 07 @ 9:53 am:
“(Rahm, Jan, Jesse, Durbin), ”
You write off Barack so soon?
- KenoMan - Friday, Nov 2, 07 @ 9:56 am:
Mayor Daley doesn’t deserve to host the 2016 Olympics. Thanks to his great “planning” (less than five years ago) the new Soldier Field is inadequate to host the Games. We therefore get a plan for a “temporary” stadium, higher taxes, and a crumbling, hack-filled, mismanaged CTA system. No thanks.
- b-dogg - Friday, Nov 2, 07 @ 10:02 am:
people in chicago had better get organized, really quick, in opposition to daleympic’s. this is shaping up to be the greatest boon-doggle of all time…
- Loop Lady - Friday, Nov 2, 07 @ 10:25 am:
sounds like Ben is right on the mark to me…
- fan of Capitol Fax - Friday, Nov 2, 07 @ 10:49 am:
I work (indirectly while colleagues work directly)with TIF funds. They are highly prescribed in the area that my department uses them. For one they have to benefit directly businesses that generate the increment(as opposed to say funding programs for residents of the TIF district). They do not appear from this perspective to be a “slush” fund. Since schools for instance do not pay taxes I do not THINK they can be used to hire teachers. I am hardly an expert and like other commenters am interested in learning more. Can someone explain if they truly can be used like general revenue funds or if in fact there are tight regulations regarding what are allowable costs for TIF funds?
- Cogito - Friday, Nov 2, 07 @ 12:06 pm:
TIF funds cannot be used like general revenue funds. The Illinois TIF Act identifies what expenditures are eligible uses (for example, public infrastructure, some that are not (for example, the cost of new construction for a privately-owned building), and some that is required (for example, payments to school and library districts under certain circumstances).
State law also requires that the municipality approve a plan for the TIF area that specifies how the funds will be used — within what is allowed by law — and over what period of time. Any expenditure must be one allowed by the TIF Act as well as one represented in the plan.
As for the impact on the other taxing bodies, the Illinois Department of Revenue paid faculty at the University of Illinois-Chicago to specifically study the impact of TIF on school districts. The “unoffical” results were — contrary to what Quigley and others contend — little to none. I say “unofficial” results because IDoR has yet to release this now 2-year old study.
Wonder why not?
- Patrick McDonough - Friday, Nov 2, 07 @ 12:17 pm:
I am overjoyed Ben Joravsky is getting the TIF message out. Chicago City Council simply approves everything Daley puts before them. I think we need to explain these TIFs in a manner a third grader understands to the general public. By the time the average taxpayer realises the consequences of TIFs, it will be to late. I think it is too late now. Thanks Ben.
- Loop Lady - Friday, Nov 2, 07 @ 12:32 pm:
It is so sad that parts of the City of Chicago infrastructure are literally falling down and there is not the political will to remedy it, but the powerful and wealthy interests who will profit from 2016 can’t hop on board fast enough…
Some things never change…
- Uptown - Friday, Nov 2, 07 @ 1:03 pm:
Cogito,
Then how do you explain the Wilson Yard TIF in Uptown to build low-income high rises?
- Cogito - Friday, Nov 2, 07 @ 1:21 pm:
Uptown, “explain” what part of the project? How it qualified or how the project could be built? Not knowing the details of this particular project, I can’t give you a specific answer.
In general TIF Funds could have been used to acquire the property, demolish any existing structures on the property and clear it for construction, and/or provide infrastructure to the site. These uses would all be eligible under the TIF Act. If the high-rises are publicly, rather than privately, owned, funds could be used for their construction. Assuming that this is housing for low or very low income persons, a part of the cost of construction could be covered with TIF funds even if they are privately owned. This allowability was added a number of years ago to encourage additional housing for low-income people as defined in the Act.
- Captain America - Friday, Nov 2, 07 @ 1:32 pm:
Although, I think Chicago desrves an opportunity to host the Olympics and that Chciago would do a great job as the host city, I think the international reputation of the US is so bad as a result of the Bush Administration policies and actions, that the US is unlikely to be chosen as the venue for the 2016 Olympics.
- VanillaMan - Friday, Nov 2, 07 @ 1:59 pm:
What a bunch of nonsense!
TIFs are not slush funds. They are not blank checks. They do not negatively impact a city as opponents claim.
TIFs are being used as a scapegoat during this fiscal crisis. To have Ben Joravsky put together a scenario where Daley is using TIFs to fund the Olympic bid is really stretching it.
Everyone is fighting at the shrinking trough right now. Daley does not have the ability to pass gas without someone screaming, regardless of his re-election. So he would be served rare on a silver platter if he tried what this guy claims. There are too many special interests ready to jump on every penny, and this keeps even legal budget moves on the defensive.
Sorry, there is no boogeymen there.
Finally, it is high time to drop the “we’re hated in the world” myth. I went to school during the Clinton years and there is nothing new to the America bashing Democrats are claiming we are undergoing right now. The Anti-America zealots were in full force over a decade ago, and I spent a lot of my time defending us against these idiots at university.
Ever since the Wall fell, we have been unwelcomed to a lot of naive Europeans who are short sighted or blinded to reality. They don’t like seeing our culture taking over theirs and with every new US import, there are a lot of Xenophobes crying in their borscht.
The moment they discovered that Bush was from Texas, they started stereotyping him even before he was inaugurated. They did the same to every president. Reagan was a senile actor, Clinton was an ignorant hillbilly, on and on.
We are the world’s superpower and they are unhappy they are not. But it is far better that we are and not they. Because the last time they ruled, 60,000,000 died over a seven year period during the 1940s and they have yet to recover from their self-inflicted scars.
I know. I spent too much time debating these holier-than-thou snots over the death penalty, our anti-smoking laws, our anti-abortion stands, religious fundamentalism, and every other issue in which they felt they were superior to us.
Bush wrecked our image? Where have YOU been since 1989? Try being a little less colloquial, and more global. Start by not blaming us for a change, OK?
- LM - Friday, Nov 2, 07 @ 2:45 pm:
The debate of TIFs would be better if there were more transparency. What are the reporting requirements? How much money is collected? Who keeps track of the balance? What are the audit requirements?
Also the sheer number of TIFs in Chicago makes it difficult for citizens to understand what is going on where. It’s a difficult and complicated story for the media to report. In the end folks are confused and don’t want to deal with it. You have to admire Joravsky for his doggedness on this issue.
- Captain America - Friday, Nov 2, 07 @ 2:57 pm:
Don’t know what international opinion polls you might have been reading.
Objective analysts - Republicans and Democrats- realists and idealists- agree that the Bush administration decision to invade Iraq has been the all-time greatest strategc blunder in the history of American foreign policy, not to mention a trillion dollar mistake.
(Neoconservatives don’t agree, but then they are the architects of this disaster.)
Unfortunately, the reality of the Iraq debacle, torture, and extraordinary rendition, is that these facotrs have adversely affected our international reputation. Who would you blame for this state of affsirs, other than the Chneney-Bush administration. Historians already seem to agree that Geogre Bush will be regarded as one of the worst Presidents in American history.
This is objective reality, not ideology speaking. I think that the international image of the US as a “rogue superpower” could affect the decision of the inernational Olympic Committee regarding the 2016 venue. We did do graeat things for the world in the 1940s, but we’re not perceived as the good guys anymore!
I suggest you take off your rose-colored glasses and try to see thing the way they really are, instead of how we’d like them to be.
- Truthful James - Friday, Nov 2, 07 @ 4:49 pm:
Cogito Ergo Sum
Each year each municipality is required to hold a Joint Review Task Force meeting indicating the Revenues received, the costs expended and the additional costs relevant to the purpose of the TIF The Municipality as chair must then indicate that there are no revenues surplus to TIF Redevelopment Plan requirements. If there are Moneys on hand that are surplus, they are to be distributed to the overlapping taxing bodies in proportion to their share of the Tax Rate.
All taxing units are members, can attend and are Board members. Failure to hold such a meeting is a violation of the TIF statute.
That means that everybody from Cook County to the Chicago School District to the Metro Water Reclamation District, the Coomunity College District dwn all the way to the Mosquito Abatement District and the TH Sanatorium are members. They are the ones who can review and pick at the numbers. These are public meetings and not only any and all taxpayers and Reporters can attend - - the latter should attend.
I have yet to see in the media any reportage of such meetings from any Districts anywhere, but they exist.
In addition there are two other sources of data. Danny Hynes and the State Department of Revenue require an annual report on each TIF which is fairly easy to follow.
If Bonds were sold, the Securities and Eschange Commission requires a filing at the Nationally Recognized Municipal Securities Information Repositories — there are five called familiarly NRMSIRs annually of data required of the municipality at the times that Bonds were sold. These include information relative to the issue and the security of the revenue stream.
In other words, the information is there and it appears that each of the overlapping taxing units did not give a damn.
- wallace - Sunday, Nov 4, 07 @ 1:10 pm:
Line up in front for membership in the “Chicagoans for the 2016 Rio Olympics”. Go Rio Go!!!