October 31, 2014
A lengthy, heated and confusing debate unfolded in the City Council on Wednesday about spending surplus tax-increment financing dollars on Chicago’s cash-strapped schools.
There’s much to say about the political theater on display before the ordinance was tabled — specifically about the thinly veiled attempt by advocates to brand each alderman as “for” or “against” Chicago’s schools based solely on that vote. But we’re not taking that bait.
We’ll stick to the basics: Some aldermen are justifiably frustrated that a TIF ordinance they introduced in July has been sent to the Rules Committee to die.
The best outcome from Wednesday’s spectacle would be that the Rules chairwoman would finally grant a hearing on the TIF ordinance, as well as one on a resolution to put a non-binding referendum on the March ballot for an elected school board for Chicago. Those issues deserve a public hearing, not a freak show debate in the City Council.
The TIF ordinance would mandate that the city turn over to the city’s taxing bodies 100 percent of all surplus money in the TIF districts that hasn’t been pledged to a specific project. The schools would get half the money. In TIF districts, taxes from growth in property values in distressed areas are set aside for 23 years to go for public works and private development.
We strongly support declaring an annual TIF surplus, particularly this year when schools suffered deep cuts. Introducing the ordinance likely helped that cause: Mayor Rahm Emanuel earlier this month declared a surplus at a higher rate than in the past. Emanuel has declared a surplus each year since taking office, but this year he’s handing over 29 percent of the unallocated cash, up from the standard 20 percent.
We think the city could go a little higher but we refuse to let that be the last word on CPS’ finances. The schools are in fiscal crisis. On this, everyone agrees. But focusing narrowly on TIFs is a mistake and a distraction.
As we’ve said many times, TIFs are no match for the massive money troubles facing the Chicago school system.
A real solution begins with reducing teacher pensions and raising new revenue for a school system in desperate need of it.