"tif 101" - city bureau 7-6-17
TRANSCRIPT
July 6, 2017Tom Tresser
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Key Policy Questions
1. Under what circumstances do we give public $ to private
business?
2. Who plans what for whom? AKA, What defines
“community development”?
3. Is Chicago broke?
4. Who’s watching our back? Need for new leaders.
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The TIF Illumination Project
started in 2013.
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What are TIFs?
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What are TIFs?• Created by municipality (state law)
• Designed to subsidize some business project
in “blighted” or under-served area
• “But for” test – only for projects market CAN
NOT support
• Captures “incremental” property taxes ABOVE
base when district was created
• Only for hard costs
• Lasts 23 years
• Supposed to be spent where collected
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What are TIFs?
The Midwest TIF – 24th Ward
(created in 2000)
Say there
are 1,000
properties
in the
TIF…
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How Do TIFs Work?When the TIF is created,
the city tallies up all the
property taxes
generated by district in
that year (called the
"base" amount). After
that, all property tax
increases above the
base (the "increment")
are channeled to the TIF
district.
The property taxes
collected from
properties inside the
district BEFORE the
district was created
that go to units of
government stays
FLAT for the life of the
TIF (23 years).
B
A
S
E
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Money From TIFs Taken From?
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What are TIFs?
Under state law, areas proposed for TIF designation
must possess numerous blighting factors to be
eligible:
• Age
• Obsolescence
• Code violations
• Excessive vacancies
• Overcrowding of facilities
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TIFs Used to support commercial projects in these “Blighted” Areas
40 S. Halsted
Apple Store
14Better Government Association
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How Many TIFs?
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Where are TIFs?
2015
Chicago = 146
Suburbs = 293
Cook County = 439
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Mr. TIF
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To sum up:
TIFs = property taxes
Increment $ collected by TIF
Run by city (mayor)
Lasts 23 years
Blight & “But for” conditions
Hard costs
Supposed to be spent where
collected
TIF $ in Chicago’s Loop
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123 S. Dearborn Street –
Dearborn Center
32 W. Randolph Street –
Oriental Theater
1 N. Dearborn Street - Sears
TIF $ in the Loop
188 W. Randolph Street –
Randolph Tower
Apartments
230 N. Michigan Avenue –
Hard Rock Hotel
555 W. Monroe Street –
PepsiCo
TIF $ in the Loop, Near West Side
TIF FUNDS IN THE 46th WARD Lincoln
Park
Where are Parks MOST Needed?
TIF Funds in the 3rd Ward
UPDATE - $55 MILLION TIF
FUNDING SHIFTED FROM
DePAUL STADIUM TO
MARRIOTT HOTEL .
PIER AUTHORITY TO PUT UP
$100 MILLION FOR
STADIUM PROJECT.
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$17.1 billion revenues in 2016
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TIFs hoard taxes
in prosperous
communities –
starve poor
communities.
1. They further inequality in chicago.
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Authors plead "Our
message is simple:
'Please, please, if you're
going to offer incentives,
don't give them to every
firm that asks -- Don't!
Ninety percent of the
time they don't work, and
handing them out after a
company has already
located in an area
without them makes no
sense at all."
Let’s Get Local…
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Woodlawn TIF
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• TIF #065
• Created 1999, Expires 2022
• Property tax extraction in 2015 = $2,298,703
• Total extraction to 2015 = $31,792,116
• Spent 2015 = $1,263,697
• Transfers = $1,263,697 (to 71th/Stony Island
TIF to pay down 2007 Bond Series, Modern
Schools Across Chicago construction)
• Dept. of Planning siphoned off $62,781
• Balance at end of 2015 = $11,175,872
• Ward 20 = Alderman Willie Cochran
https://www.cityofchicago.org/city/en/depts/dcd/supp_info/
tif/woodlawn_tif_.html
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Biggest Project – Strand Hotel
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Holsten investing
$10,000 and his fee is
$1,000,000. Nice.
Bank makes $950,000.
Architect = $778,218.
Lawyers = $575,000.
Nice.
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62 units created by spending
$22.9 million = $369,355 each.
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$343,930 to Chicago elected officials since 1994.
$54,500 to Alderman Ed Burke since 2002.
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www.tifreports.com
www.wearenotbroke.org
www.civiclab.us/training
312-804-3230