Question of the day
Tuesday, Feb 21, 2023 - Posted by Rich Miller
* The owners will likely ask for infrastructure help down the road, but so far the Bears haven’t asked for any direct state funding…
* The owners instead want a new state law to allow them to essentially negotiate a local property tax payment…
Called a payment in lieu of taxes, or PILT, the new subsidy is similar to tax increment financing, with a couple of key wrinkles: Initial tax payment amounts would be negotiated between the company and local taxing bodies rather than tied to property appraisals, and it would be available only for investments of $500 million or more. The Bears’ proposed project is estimated at $5 billion.
Some argue PILTs will help Illinois municipalities land major investments that will create tons of high-paying jobs — like maybe an electric vehicle battery plant. Others say they’re open-ended giveaways to rich companies.
* One very big problem…
It was on November 15, 2000, that then-Mayor Richard Daley called reporters to a skybox at Soldier Field, to unveil his new vision for the stadium. […]
But as the press and public focused on the aesthetics of the stadium, which would become the smallest in the National Football League, few examined the fine print of the deal itself: a $587 million plan where the Bears and the NFL each chipped in $100 million, with the remaining $387 million to be financed by public bonds, backed by a hotel/motel tax levied in the city of Chicago.
Documents obtained by NBC 5 Investigates show the actual bond issue by the Illinois Sports Facilities Authority came to $398 million. But today, more than 20 years after that money was borrowed, the ISFA still owes over $383 million in principal, and more than $256 million in interest.
That’s a total of over $640 million, $63 million more than was originally borrowed, even after making payments for more than 20 years.
Another “ramp.”
* The Question: Could you support the Bears’ “payment in lieu of taxes” bill if the team is also forced to promptly pay off all the remaining Soldier Field debt? Take the poll and then explain your answer in comments, please.
- Anon221 - Tuesday, Feb 21, 23 @ 11:02 am:
Voted No. This is not a Bears only bill. PILOT is not something Illinois should start using. It hasn’t worked out well in other states for other projects. Schools and local governments usually have to negotiate a PILOT agreement, and that gets messy fast. Usually they will end up with less funds than they would have through regular tax assessments. Make it a Bears only bill with the prompt payoff of the Soldier Field debt, then maybe.
- Save Ferris - Tuesday, Feb 21, 23 @ 11:04 am:
I could support this either way. What I want to know is why the bonds haven’t been paid down, but have instead appeared to capitalize the interest. What is going on with that? Don’t the bonds need to be retired? Or have they kept refinancing the bonds with new bonds?
How is the Park District doing this? And I can’t see this being the Bears’ fault.
- Pundent - Tuesday, Feb 21, 23 @ 11:08 am:
Voted no. Because the Bears would only agree to such an arrangement if the incentive far exceeded the value of paying off the debt. And that would mean that the taxpayers would be on the hook for something greater than $640M. That’s making the bond decision, which in hind sight looks really bad, even worse.
As has been noticed before, the Bears should face little if any obstacles taking on debt given the current and future enterprise value of the franchise. The city and taxpayers have been burdened by the Soldier Field bond issuance and there’s no reason to make matters worse for the sole benefit of the Bears.
- Bruce( no not him) - Tuesday, Feb 21, 23 @ 11:08 am:
===That’s a total of over $640 million, $63 million more than was originally borrowed, even after making payments for more than 20 years.===
That seems fiscally responsible. Let’s do that some more.
- Bruce( no not him) - Tuesday, Feb 21, 23 @ 11:10 am:
Oops, forgot the /S
- Poor taxpayer - Tuesday, Feb 21, 23 @ 11:12 am:
I voted yes, but only under the following condition: taxpayers get an equity stake in the team. For all the money taxpayers have spent on the Bears, I think a 20% stake is a reasonable request.
- TheInvisibleMan - Tuesday, Feb 21, 23 @ 11:12 am:
No.
Illinois TIF law has enough holes in it to drive a truck through, and that’s still not enough for them. Now the Bears ownership want to create something even less socially useful than a TIF, for no other reason than their own greed.
- Ryan - Tuesday, Feb 21, 23 @ 11:15 am:
No. The Bears pays off the debt, then Chicago brings in another NFL team. The Chicago Jaguars…
- Oswego Willy - Tuesday, Feb 21, 23 @ 11:19 am:
I’d consider the discussion to this end, but I’m not a full “NO”
Here’s the sitch for me, if you want discussions…
You csnt tell me the math of 40 years for the building that needs renovations in 25 is smart for anyone but the Bears, even paying off the Park District.
That’s a full non-starter.
Not one dime to that.
You talking *5* years of taxes, payoff the Park District, still a “no” but we are getting far closer than the Gillespie Bears Bailout.
- Amalia - Tuesday, Feb 21, 23 @ 11:21 am:
No. Sorry Chicago, but if you can’t keep the team, the State should not be messing around with rules that can have impact on others. Besides, you still have the asset, you can use it differently without the Bears. Don’t give in to a bully who has already purchased the land.
- Gravitas - Tuesday, Feb 21, 23 @ 11:22 am:
I fully support making the Chicago Bears pay the Chicago Park District as provided for under the terms of their current lease through its expiration date. Garcia asking for payments of lost income indefinitely makes no sense.
- DuPage Saint - Tuesday, Feb 21, 23 @ 11:23 am:
I really don’t understand finance that well. If they have been paying off bonds for 20 years why is the debt gone up? And why would that be the Bear’s problem. Maybe someone should really examine some of the deals laid by Daley. The parking meter deal the stadium and whatever else he sold off.
- Donnie Elgin - Tuesday, Feb 21, 23 @ 11:24 am:
Voted yes - but part of the question seems flawed - Soldier Field will not be torn down or cease to exist with the Bears. Soldier Field has a future without the bears; the 2002/3 improvements would be applicable to attracting Soccer games/ sports/concerts and other uses.
- Captain Obvious - Tuesday, Feb 21, 23 @ 11:24 am:
Whoever owes the debt should pay it. Whatever property taxes end up being, the property owner should pay it. You know, like you and me have to. It’s really not all that complicated. If not getting a giveaway means a project is killed, it probably was a bad deal to begin with.
- Lucky Pierre - Tuesday, Feb 21, 23 @ 11:30 am:
How can the Bears be “forced to pay off the debt” for an asset they don’t own?
- Lurker - Tuesday, Feb 21, 23 @ 11:33 am:
I’m starting to like the idea of them moving … even out of state. I’m liking the sound of the Chicago Jaguars.
- Donnie Elgin - Tuesday, Feb 21, 23 @ 11:33 am:
“How is the Park District doing this? And I can’t see this being the Bears’ fault”
A good question the Bears Lease only runs through 2033 - no way that principal would be paid in 10 years
- TJ - Tuesday, Feb 21, 23 @ 11:38 am:
Hoping and expecting them to get not a single cent of state support in any way, shape, or form.
Pay your own bills, Virginia.
- Annonin' - Tuesday, Feb 21, 23 @ 11:39 am:
We voted NO. Let’s get them to pay off the Chicago debt FIRST. Then cook up a new concept to get the Jags a decent sized place to play. Meanwhile the MCCaske Dome can remain a dream for the ‘burbs.
- Oswego Willy - Tuesday, Feb 21, 23 @ 11:40 am:
The Jaguars will go to London before Chicago and they ain’t going to London.
Yet.
- Homebody - Tuesday, Feb 21, 23 @ 11:42 am:
The first step when you’re in a hole is to stop digging. The Bears will never pay off any city of Chicago debts. There is no point in even entertaining that idea.
Billionaires don’t become billionaires by paying bills they aren’t obligated to pay.
- Tood Aloo - Tuesday, Feb 21, 23 @ 11:46 am:
I voted no because I’m tired of the bears coming at us with their hands out, threatening to leave. The equity stake is interesting.
- 47th Ward - Tuesday, Feb 21, 23 @ 11:48 am:
===That’s a total of over $640 million, $63 million more than was originally borrowed, even after making payments for more than 20 years.===
Wait, what?
Banned words followed by banned punctuation.
- Anonymous - Tuesday, Feb 21, 23 @ 11:53 am:
==I voted no because I’m tired of the bears coming at us with their hands out, threatening to leave.==
No, because THIS^^
What have you done for us lately, Virginia? Ticket prices increase every year, making games virtually inaccessible for the average Bears fan.
- TinMan - Tuesday, Feb 21, 23 @ 11:55 am:
When you own something, you own. That includes debt . The Bears were a tenant. They don’t own the property. So when you make a bet that this property will be used for many years in the future and not become obsolete that is on the Management of the city.
- Jerry - Tuesday, Feb 21, 23 @ 12:01 pm:
The Bears got $640,000,000.00 in Free Stuff already. That’s what Republicans call it when a family gets $2.50 to buy food. So no Socialist Entitlements for “for profit” privately owned corporations.
- Just Me 2 - Tuesday, Feb 21, 23 @ 12:08 pm:
Man, Daley was really comfortable with screwing future generations in exchange for something shiny, wasn’t he? This worse than the parking meters.
- JS Mill - Tuesday, Feb 21, 23 @ 12:21 pm:
No on all accounts.
No reimbursement for Chicago because they got a bad deal.
No PILT.
=Called a payment in lieu of taxes, or PILT,=
It is unsurprising that the Bears do not know how to do this without legislation, because it happens all of the time. During the ethanol plant boom, companies would contest their property taxes on the plants.
Usually, schools etc. lose with PTAB but their was always the chance the company would not prevail so they entered into an agreement that would get a reduction in property tax and then the company made a payment directly to the district. WHile the payment was less than they would get a full value, it was not counted against them in the funding formula. It worked out for everyone.
If the Bears were smart, they would have already had these discussions with the taxing bodies. So much easier. But hey, it’s the Bears.
- yinn - Tuesday, Feb 21, 23 @ 12:32 pm:
Voted no because I don’t like how PILOT has worked in my own town.
As an aside — and not saying Chicago can and does do this, nor that this is the reason for the perpetual debt described above, but. Park districts generally take advantage of statutory permission to work refunding bonds to capture a higher levy each year than they would otherwise.
- Rich Miller - Tuesday, Feb 21, 23 @ 12:33 pm:
===I don’t like how PILOT has worked in my own town===
It’s not even a law yet.
- Benjamin - Tuesday, Feb 21, 23 @ 12:55 pm:
Voted no. The Bears can’t pay Chicago to get out of paying Arlington Heights. (Imagine the uproar if the proposed deal were the other way around.)
If the last few decades of subsidies haven’t made the Bears wealthy enough to pay their taxes, then a few more decades isn’t going to help.
- Huh? - Tuesday, Feb 21, 23 @ 1:10 pm:
Be still my heart, I agree with LP.
I have to sit down before I faint.
- Demoralized - Tuesday, Feb 21, 23 @ 1:14 pm:
==How can the Bears be “forced to pay off the debt” for an asset they don’t own?==
By making the PILT contingent upon it. That’s how.
- Candy Dogood - Tuesday, Feb 21, 23 @ 1:15 pm:
No.
So many reasons why no. You can use the butt of a pistol to Crack nuts but that doesn’t mean it’s a good idea or a good tool for that job. PILOT is not meant for supporting private for profit companies. It’s not intended to allow billionaires to screw over businesses that aren’t large enough to buy a legislator or try to leverage the City of Chicago.
Why should we let one group of billionaires screw over all of the other people that own property.
- Pundent - Tuesday, Feb 21, 23 @ 1:23 pm:
The improvements were made to Soldier Field for the Bears benefit not the occasional U2 concert or soccer match. And in many respects I have no sympathy for the city and former mayor who were more than willing to layout $600M for a short term tenant. But the exercise should only reinforce that providing financial incentives to professional sport teams is a fools errand. No need to make the same mistake again.
- Chicagonk - Tuesday, Feb 21, 23 @ 1:27 pm:
Voted yes - There is a deal to be made here.
- Cool Papa Bell - Tuesday, Feb 21, 23 @ 1:27 pm:
No.
=ISFA still owes over $383 million in principal, and more than $256 million in interest.=
If the Bears want it, then to me it means that taxpayers are setting up to get fleeced all over again. The thing is the Bears aren’t going anywhere other than another town in Chicago. They have zero leverage here. There is nothing that should be done to keep them here - because there is no place for them to go.
And back to the above - How is none of this paid off?
- H-W - Tuesday, Feb 21, 23 @ 1:29 pm:
I voted no.
When capital becomes so big that it can create (dictate?) its own tax plan (PILT), in contrast to the citizens and the community, and in contrast to the majority of private sector entities, capital is too big and does not need “help.” It must not be allowed to dictate policy contrary to the role of governments.
- Alex Pulles - Tuesday, Feb 21, 23 @ 2:28 pm:
Anyone who’s been in Illinois since Soldier Field was remodeled should fight giving the Bears anything, and should suspect the politicians will:
1. Excuse the Bears from paying back the $640,000,000 that the remodeling has now cost, and 2. Will give the Bears money to build new stadium, AND
3. Will give them a break on property taxes too.
- Oswego Willy - Tuesday, Feb 21, 23 @ 2:44 pm:
===How can the Bears be “forced to pay off the debt” for an asset they don’t own?===
Contracts are funny, the Bears could stay in Soldier Field, pay what was agreed to the lease
You wonder why I’m a “No”. The idea the Bears will be “fine” for 40 years… 4-0… then what, in 20-25 years… more breaks for a “massive rehab”…
Yeah. No.
The Bears want to move, as you put it, to generate more revenues…
… well, payoff the Park District, that’s a strong act of good faith.
- Jerry - Tuesday, Feb 21, 23 @ 3:24 pm:
Agree with OW. If you want to break the lease on an apartment (Soldiers Field) then you pay off the lease or find someone else to take over the current lease. It’s not that hard.
- Huh? - Tuesday, Feb 21, 23 @ 3:45 pm:
OW - I don’t think we are talking about the payment to break the lease. That is in the $40 million range. The bears should pay to break the lease.
The $383 million we are discussing was to remodeling soldier field, the remainder of the bond sale by the Illinois Sports Facilities Authority.
Bears shouldn’t have to pay for the remodeling of soldier field.
- Oswego Willy - Tuesday, Feb 21, 23 @ 3:53 pm:
===Bears shouldn’t have to pay for the remodeling of soldier field.===
Would Soldier Field *ever* been renovated… to the Bears specifications?
Why did the Bears agree to anything?
The Bears pay the money left on the building… then I’ll consider maybe 5 years of things, but not 40
The Bears don’t pay, why in the world should they get any monies, they shouldn’t get a nickel already, now leave with that cash still out there…
- Mike Sorensen - Tuesday, Feb 21, 23 @ 4:41 pm:
===If you want to break the lease on an apartment (Soldiers Field) then you pay off the lease or find someone else to take over the current lease.===
If you break a lease, you might have to pay the outstanding terms of the lease, but you don’t have pay the landlord’s outstanding mortgage on the property.
I’m sure there’s stuff I don’t know about, but if the ISFA took out the loans in bond form and they haven’t gotten around to paying them back, that should be on the “landlord” to handle, not the “tenant,” no?
- Oswego Willy - Tuesday, Feb 21, 23 @ 4:53 pm:
===I’m sure there’s stuff I don’t know about, but…===
The goal of the exercise is to get 60/30 and signature.
Deciding to leave…
===But as the press and public focused on the aesthetics of the stadium, which would become the smallest in the National Football League, few examined the fine print of the deal itself: a $587 million plan where the Bears and the NFL each chipped in $100 million, with the remaining $387 million to be financed by public bonds, backed by a hotel/motel tax levied in the city of Chicago.===
… a bunch of folks “hanging” to build a building to make a boatload of money… with the state’s help…
Yeah, the only thing to really know is 60/30 signature… and being a bad “tenant” that left things worse by leaving after wanting that says renovation… it’s the political math that is hurting more than the dollars at this point
- Chicago 20 - Tuesday, Feb 21, 23 @ 7:13 pm:
Another fine Jim Reilly mess.
Ramped repayment schedules then scoop and toss, scoop and toss, scoop and toss, repeat.
- Pundent - Tuesday, Feb 21, 23 @ 9:32 pm:
=If you break a lease, you might have to pay the outstanding terms of the lease, but you don’t have pay the landlord’s outstanding mortgage on the property.=
Of course the Bears have no obligation for that. But the debt incurred by the City to finance the Soldier Field renovation makes it even less likely that new debt or property tax relief will be granted. And that’s the point of the question.
These deals rack up a lot of debt and obligations that don’t benefit tax payers. That’s been shown time and again. The Soldier Field debacle is but one example and it doesn’t help the Bears whatsoever.