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A huge transit TIF bill passed yesterday

Friday, Jul 1, 2016

* This is kind of an odd story

State lawmakers on Thursday handed Mayor Rahm Emanuel broad authority to create special taxing districts to help pay for four major rail projects, but the mayor and his administration would not detail how much money would be diverted or how it would be spent.

The legislation, which lawmakers passed as part of a compromise on a stopgap state budget and an education funding bill, is designed to help City Hall come up with money it needs to match requirements to receive federal transportation grants and loans, Emanuel said.

But the measure also grants the mayor and City Council wide discretion to create the so-called tax-increment finance districts within a one-mile-wide swath of land along 46 miles of Chicago Transit Authority rail lines throughout the city. The districts, which could remain in place for up to 35 years, would siphon off 80 percent of property tax revenue within their boundaries (with the exception of taxes for Chicago Public Schools) and dedicate the money toward four major transit projects.

* Hmm. From Emanuel’s brief press statement…

Today marks the next chapter in the work we started shortly after I took office, to modernize the Red Line from 95th to Howard, and continue the process of extending it further south. With this bill, in just a few years we will have done what once seemed impossible, and we will improve the quality of life for hundreds of thousands of people that rely on the Red Line as part of their daily life.

One could also read the bill.

Emanuel told reporters yesterday that this would allow the city to tap into $800 million of federal money for upgrading the Red and Purple lines and extend the Red Line south.

But at least they had something. No major media outlet did much of anything.

* Somebody else could’ve given them details, too. StreetsBlogChicago got some

A new bill that would generate more funding for four large-scale Chicago transit infrastructure projects, without diverting tax revenues from schools, passed the Illinois House and Senate today. The original bill was introduced in January 2015, spearheaded by the Metropolitan Planning Council. It awaits Governor Bruce Rauner’s signature, who is expected to sign a budget today after a year of operating the state without a budget for a year – reducing funding for transit agencies, schools, and social services.

The funding would come from “transit TIF districts” that would have boundaries extended up to a half mile around Chicago’s Union Station (to fund the changes in its master plan), the CTA’s North Side Main Line, the CTA’s Red Line extension, and the CTA’s Blue Line Congress branch modernization and possible extension. The bill enables the Chicago City Council to pass a similar law to create the actual districts, but sets limits on how far the districts can extend from the proposed projects’ area.

They would work much like existing TIF districts, where the property taxes assessed on any incremental increase in property values since a district’s inception is deposited in a separate fund. This is a form of value capture in that an increase in property values spurred by the transit infrastructure is used to help pay for it.

Other key differences are that the transit TIF districts would expire in 35 years instead of the originally-proposed 50, and that instead of a blanket maximum length of six miles, each district has a specific maximum length. Fifty years was proposed because that is the useful life of a transit facility.

* Like the blogger’s post says, it’s essentially a reworking of a bill that Greg Hinz detailed last year. I told subscribers about it yesterday morning and gave them a House Republican analysis. Here’s part of it

The transit TIF boundaries shall not exceed 9 miles and no more than 1⁄2 mile in any direction from the location of a mass-transit facility. “Your New Blue,” is a 4-year plan aimed to address the 25% ridership increase in the last 5 years. The project received $120 million in federal funding in 2015 to begin the first stage of the $492 million renovation. The initiative consists of upgrades for 13 blue line stations, which include changes to the following stations: Grand, Chicago Division, Damen, Western, California, Logan Square, Addition (completed in 2016), Jefferson Park, Irving Park, Montrose, Harlem, and Cumberland. Damen and California stations received rehabilitation in 2014. An estimated 1,300 construction, engineering, and design jobs will be created as a result of the project. […]

Blue Line Modernization: This is a 4-year plan aimed to address the 25% ridership increase in the last 5 years. The project received $120 million in federal funding in 2015 to begin the first stage of the $492 million renovation. The Blue Line Forest Park project is not eligible for large amounts of funding because of an IDOT collaboration along I-290.

The Red and Purple Line Modernization Program (RPM): The $570 bottleneck reconstruction is intended to enable CTA to service 7,200 additional costumers per an hour. Further construction includes modernizing the 90-year-old tracks between Lawrence and Bryn Mawr stops and adding disability modifications. Wilson and Clark/Division upgrades were completed in 2015. Total project cost is $1.9 billion for RPM. Although, RPM secured a Core Capacity Grant $900 million grant there is still a $711 million funding gap, which can be filled by an increased TIFIA Loan if a local funding source is identified.

Phase One includes the Red-Purple bypass, Lawrence to Bryn Mawr and signal reconfiguration. Construction starts in 2018 over a 4-year period and cost $2.1 billion. This specific project received a $1.2 million grant for a Transit-Oriented Development study. TIF increment will only cover 33% of the project for Phase One. Phase Two includes reconstruction from Thorndale to Howard over 4 years starting in 2022, with an estimated cost of $2.6 billion. Phase Three includes upgrades from Addison to Sheridan, Purple Line Howard to Linden, over 4 years starting in 2026. This project will need support from Evanston to incorporate Linden into proposed changes. Total cost projects to $3.2 billion, but without support of Evanston, its $1.5 billion.

Red Line Extension: In April 2014, Chicago Transit Authority (CTA) secured $70 million in federal funding through the Transportation Infrastructure Finance and Innovation Act toward a $240 million renovation for the 95th Red Line Terminal. CTA also secured a $20 million TIGER grant, which $16 million went toward the 95th terminal project.

* Related…

* Lawmakers approve extension of downtown Springfield TIF district

- Posted by Rich Miller        

14 Comments
  1. - Dome Gnome - Friday, Jul 1, 16 @ 12:16 pm:

    Much of the floor discussion centered around concerns that the TIF money would be used to enrich the area surrounding a certain winning baseball team on the north side. The discussion was sufficiently vague.


  2. - Reality Check - Friday, Jul 1, 16 @ 12:25 pm:

    This is frightening. How many boondoggles have been passed just like this, at the last minute, with zero oversight? The impact on city budgets for decades to come is unknown and potentially enormous.


  3. - Whatever - Friday, Jul 1, 16 @ 12:33 pm:

    Reminds me of the old joke about the woman sleeping in the hospital after giving birth to her 8th child. When her husband comes in quietly and kisses her on her cheek, she rolls over and says, “Not starting in again already, are you?”


  4. - Cheryl44 - Friday, Jul 1, 16 @ 12:33 pm:

    Aren’t TIFs part of the problem?


  5. - Doug Simpson - Friday, Jul 1, 16 @ 12:35 pm:

    I’ve read alot of what Chicago Reader has reported on TIF’s…and to say the least, I’m a little concerned.

    I understand the idea of building around the train stations, and agree with it. Its been successful in the suburbs in places.

    Where is the oversight?


  6. - Anonymous - Friday, Jul 1, 16 @ 12:44 pm:

    Does anyone really believe that even 10% of the reps or senators knew this was in the bill?


  7. - Honeybear - Friday, Jul 1, 16 @ 12:46 pm:

    I’m not a fan of TIF’s. They drain the local coffers. From a free market perspective they pick winners and losers and give the winners benefits. I also can’t stand EDGE incentives. That report is due out today from DCEO. These things are the goodie bag that both sides have been dipping their paws into. “Taxpayers” as the right likes to call them, should be aware of these cash cows for the elite.


  8. - Rich Miller - Friday, Jul 1, 16 @ 12:51 pm:

    ===at the last minute, with zero oversight?===

    This bill has basically been sitting around for a year. Can you read?


  9. - a drop in - Friday, Jul 1, 16 @ 1:02 pm:

    I don’t see any mention of the brown line flyover north of Belmont. Anybody know what happened to it?


  10. - Upstate - Friday, Jul 1, 16 @ 1:23 pm:

    Critical bill. You can’t get something for nothing. The Feds require a match for their money and its Big Money. Big Jobs. And the heart of mass transit in the economic engine of the State.


  11. - FPJ - Friday, Jul 1, 16 @ 1:46 pm:

    @Honeybear: These are different than normal TIFs in that the funds raised are only used on transit projects. They won’t be used to pick private-sector winners.

    One other thing that is unusual here. They explicitly exclude school funding. So CPS will not be impacted.


  12. - Springfield - Friday, Jul 1, 16 @ 1:50 pm:

    That bill makes Rahm one of the big winners this week


  13. - Ron - Friday, Jul 1, 16 @ 1:54 pm:

    “I’ve read alot of what Chicago Reader has reported on TIF’s”

    Well, that’s the problem. Joravsky is a liar when it comes to TIF.


  14. - Ron - Friday, Jul 1, 16 @ 1:55 pm:

    “Where is the oversight?”

    We have 50 aldermen and a Mayor. That’s more than enough oversight.


Sorry, comments for this post are now closed.


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