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Public subsidy


PI Original
by Ellyn Fortino
Wed Nov 6, 2013

A Look At The Fall Veto Session: What's Happened & What's Next (UPDATED)

Progress Illinois provides a roundup of the highlights from the fall veto session, and offers a look at what might be next.

Quick Hit
by Ellyn Fortino
Wed Oct 30, 2013

Chicagoans Demand Aldermen Release Crucial Legislation From Rules Committee (VIDEO)

Chicagoans took to City Hall Tuesday afternoon to demand that aldermen resurrect critical ordinances from the Rules Committee, also known to some as the place "where good legislation goes to die."

About 50 organizers with the Grassroots Collaborative, a coalition of labor and community groups, staged a "burial protest" highlighting the various measures stalled in the rules committee, putting a specific focus on a Tax Increment Financing (TIF) Surplus Ordinance Ald. Bob Fioretti (2nd) introduced back in July.

The ordinance calls for any TIF surplus funds to be sent back to government agencies, including the Chicago Public Schools (CPS) district, which would help ease recent school budget cuts. The measured garnered support from 32 out of the  council's 50 aldermen, but it's been pending in the Rules Committee since it was introduced.

TIF funds come from a portion of collected property tax dollars from those living inside a TIF district. TIF dollars are typically used for economic development projects in the city. The activists, however, said the "buried" TIF Surplus Ordinance would release millions of additional dollars that could be used for the struggling public schools system as well as expanded community services, including the reopening of six city mental health clinics that closed last year.

"But instead of being debated and voted on, this ordinance is stuck in [the] Rules Committee," stressed Grassroots Collaborative Executive Director Amisha Patel. "There it's buried along with many other good ordinances."

Quick Hit
by Ellyn Fortino
Mon Oct 21, 2013

Chicagoans Urge DePaul University President To Reject $55 Million In TIF Funds For Basketball Arena (VIDEO)

Chicagoans fed up with the mayor's decision to use public funds to help finance a controversial DePaul University basketball arena near McCormick Place urged the college's president Monday to refuse the $55 million in tax increment financing (TIF) funds set aside for the project.

About 40 education activists picketed outside a City Club of Chicago luncheon at a downtown Maggiano's where DePaul University President Rev. Dennis Holtschneider was speaking. The protestors said the private and profitable college does not need taxpayer dollars for the project, arguing that TIF money would be better spent on public education.

"Accepting city money from schools and from people who need it the most is not in the light of the tradition of St. Vincent DePaul," said Roderick Wilson, executive director of the Lugenia Burns Hope Center, an organization represented at Monday's protest. "They're not living up to their legacy, and we want to remind him of that ... This is not acceptable, and we want [Holtschneider] to refuse that money and let it go back to our schools."

Quick Hit
by Ellyn Fortino
Tue Oct 8, 2013

Report: Downtown Chicago Job Growth Excludes Most City Residents

A new study shows that 52,404 new jobs came to downtown Chicago between 2002 and 2011 thanks to economic development investments, yet only one in four of those positions went to city residents.

Suburbanites and people in prosperous Chicago communities like Lakeview and Lincoln Park mostly gained those jobs, and residents in the city's predominantly black and Latino neighborhoods were largely excluded, the report issued Tuesday by Grassroots Collaborative found.

From 2004 to 2008, the city spent more than $1.2 billion in public, tax increment financing (TIF) funds for these type of downtown, job creation investments, according to the report called, “Downtown Prosperity, Neighborhood Neglect: Chicago’s Black and Latino Workers Left Behind.”

"This type of development creates disparities clearly along racial lines, and the city should not be endorsing policies that shift more money to a smaller group of the city," said Eric Tellez, research and data manager with Grassroots Collaborative, a coalition of community and labor groups. "For all of the city to do well, all of its residents need to do well. Prioritizing downtown development to the exclusion of neighborhoods is an economic development strategy that is failing most people in the city."

Quick Hit
by Ellyn Fortino
Wed Sep 4, 2013

Elwood Takes Legal Action Against CenterPoint Over Prevailing Wage Dispute

The Village of Elwood wants CenterPoint Properties Trust to prove that it is complying with the state’s prevailing wage laws as part of a heavily-subsidized tax increment financing (TIF) agreement to construct a massive multi-use industrial park in Will County.

Elwood officials filed a complaint in Cook County Circuit Court August 28 asking that a judge require the Oakbrook-based real estate developer to hand over records that would show workers at the Deer Run Industrial Park redevelopment site have been paid according to state law.

According to Elwood’s complaint, CenterPoint has refused to provide any payroll documents to the village that would confirm that the company is adhering to the Illinois Prevailing Wage Act, which requires a minimum wage and benefits threshold for workers associated with publicly-financed projects. Under state law, developers of taxpayer-subsidized projects are required to keep such compliance records.

“We find it troubling that CenterPoint refuses to hand over public documents that would reveal if prevailing wage laws have been violated,” Elwood Mayor William Offerman said in a statement. “Because taxpayer dollars and public records are at issue, the village has a duty and obligation to ensure that prevailing wage statutes are enforced and that local workers are getting paid what they deserve and what is required by law.”

Quick Hit
by Ellyn Fortino
Tue Sep 3, 2013

New Report Finds Widespread 'Poor Performance' Among Highest-Paid CEOs (VIDEO)

Nearly 40 percent of America’s top-paid CEOs over the past 20 years were eventually booted from their job, had to pay settlements or fraud-related fines, or led firms that received taxpayer bailouts, a recent report from the Institute for Policy Studies (IPS) shows.

During this time period, the pay gap between CEOs and average American workers has also soared, according to IPS’ “Executive Excess” report.

CEOs from the biggest companies earned 354 times as much as the typical American employee in 2012. In comparison, CEOs made 195 times as much as the average worker back in 1993.

But despite record-high CEO compensation, the report noted that America’s top paid executives have added “remarkably little value to anything except their own personal portfolios.”

“This report should put an end to any remaining sense that we have ‘pay for performance’ in corporate America,” the report’s co-author Sarah Anderson said in a statement. “Without strong action from regulators, lawmakers, and shareholders, this broken CEO pay system will continue to undermine our economy.”

Quick Hit
by Ellyn Fortino
Mon Aug 26, 2013

The CivicLab Illuminates Oak Park's TIF Program

Oak Park’s tax increment financing (TIF) program may operate on a smaller scale compared to the city of Chicago’s controversial economic development program, but it too has major transparency and accountability flaws, suburban residents said at a town hall meeting Sunday. 

The three TIF districts in Oak Park sucked up $164 million in property tax revenue since their inception up until the end of 2012, according to an analysis by the CivicLab, a Chicago-based non-profit focused on providing citizens with data and tools for civic engagement.

In 2012 alone, Oak Park’s three TIF districts took in $10.6 million in tax revenue, and the village spent almost $7 million of that money, the CivicLab found.

“I hope somewhere there is a spreadsheet that tells you what (the village) did with that money, and if there isn’t, you need to go get it, in my opinion,” the CivicLab’s co-founder Tom Tresser told about 15 community members at the meeting.

Quick Hit
by Ellyn Fortino
Wed Aug 7, 2013

U.S. Senators Push To Limit Tax Subsidies For 'Performance-Based' CEO Pay

U.S. Sens. Jack Reed (D-RI) and Richard Blumenthal (D-CT) want to stop unlimited corporate tax write-offs on CEO performance-based pay, which leaves taxpayers holding a $5 billion tab each year.

The two senators introduced a bill Friday that would limit the tax deductibility of executive pay to $1 million and eliminate the exception for commission-based and performance-based compensation.

The bill, the Stop Subsidizing Multimillion Dollar Corporate Bonuses Act, S.1476, would expand the restrictions to all current and former employees of all corporations that file periodic reports with the U.S. Securities and Exchange Commission (SEC).

The Joint Committee on Taxation estimates the legislation will rein in $50 billion in tax revenue over a 10-year period, the senators said.

“Even as income inequality rises and middle-class wages stagnate, American taxpayers are subsidizing tens of billions of dollars in corporate bonuses,” Blumenthal said in a statement. “We should be investing in working families, not using taxpayer dollars for tax breaks to corporations that overpay their executives.  Corporations should be free to pay their executives whatever they wish, just not at the expense of American taxpayers -- many struggling to make ends meet.”

Quick Hit
by Ellyn Fortino
Fri Jun 28, 2013

Report: The Coal Industry Drained Nearly $20 Million From 2011 Illinois Budget

Illinois’ net costs to regulate and support the coal industry chipped away $19.8 million from the state’s budget in fiscal year 2011, a new report by the Center for Tax and Budget Accountability and Downstream Strategies shows.

In the same year, tax incentives and grant programs for the coal industry cost the Prairie State $12.6 million, according to the report, "The Impact of Coal on the Illinois State Budget" (PDF). Without factoring in coal-related revenues, the state’s coal industry expenditures totaled $66 million in the 2011 budget year, researchers found.

Environmental advocates from the Sierra Club, Prairie Rivers Network, Faith in Place and the Eco-Justice Collaborative, which all helped commission the report, were overall baffled by the findings.

“You have to wonder why in the world we as taxpayers would be giving money to companies that are engaged in activities that directly threaten our environment, and as this report shows, are costing us money,” said Jack Darin, director of Illinois’ Sierra Club, on a conference call with reporters Thursday.