Critics not impressed with mayor’s new TIF pledge
BY FRAN SPIELMAN City Hall Reporter October 12, 2013 9:48AM
Updated: November 13, 2013 6:08AM
Chicago would declare an annual surplus in each of its 175 tax increment financing (TIF) districts — and return at least 25 percent of the cash balance to the city and public schools — under a mayoral executive order denounced as “window dressing.”
Budget Director Alex Holt unveiled the new, more “formal” TIF policy after disclosing that Mayor Rahm Emanuel’s 2014 budget will declare a TIF surplus in the $40 million to $50 million range, generating a $20 million to $25 million windfall for the cash-strapped Chicago Public Schools.
“At least for the last couple of years, the surplus has been closer to 20 percent. The mayor wanted to make sure it was at least 25 percent and that it was a floor. And to the extent added dollars were available and not needed for infrastructure, that those dollars were returned to local taxing bodies,” Holt said.
A few months ago, Chicago’s 175 TIFs had a $1.7 billion balance, but $1.5 billion of that money was “already committed,” according to City Hall. At least $350 million of those commitment were tied to school projects.
At least 25 percent of what’s left would amount to $50 million.
Chicago Teachers Union President Karen Lewis said Emanuel is obviously “responding to us and responding to this cry about some fairness in where money gets spent.”
But she argued that an executive order with strings attached is not the way to go about it: “$20 million to $25 million could help. Nobody is going to turn down that money. But it’s not going to do the kinds of things TIFs should be doing for schools.”
“Taxpayers have asked for transparency around TIFs. The TIF surplus ordinance that’s stuck in the Rules Committee gives us that — not an executive order. This is him trying to control the process.”
Members of the City Council’s Progressive Caucus, who introduced the TIF surplus ordinance, echoed Lewis’ concerns.
They argued that the executive order is mere “window dressing” because there are so many conditions and because so much money is already committed to the mayor’s pet projects.
“I wish they would have done it a lot sooner, rather than playing games,” Ald. Bob Fioretti (2nd) said.
“It’s throwing the people of Chicago and our schools a bone. Clearly, it was done too late after too many things were set up, like the DePaul stadium, which could have been funded elsewhere.”
Ald. Scott Waguespack (32nd) added, “If all the money is projected to be spent and you don’t identify the projects, you can essentially say all the money is being used. . . . It’s so minimal, I’m not even sure why he’s putting it out.”
The Progressive Caucus has been pressuring Emanuel for months to scour TIF districts for surplus funds and use them to reverse some of the 3,000 layoffs at Chicago Public Schools.
They have denounced as “wrong-headed” Emanuel’s decision to use $55 million in TIF funds to help build the DePaul basketball arena near McCormick Place.