An advisory zoning committee for Chicago's 46th Ward signed off on a private developer's request for $14 million in tax increment financing (TIF) assistance for a proposed luxury housing complex in Uptown at its monthly meeting Monday night.
The 46th Ward’s Zoning and Development Committee, put in place by Ald. James Cappleman (46th), approved preliminary plans for JDL Development's TIF project despite opposition from low-income housing advocates in the area.
A group of about 30 community activists staged a protest outside of Cappleman's office Monday night before attending the zoning meeting, held at Weiss Memorial Hospital. The protestors toted signs reading, "Stop displacing our neighborhood" and "Save Uptown diversity."
"Cappleman, as alderman over his tenure in office, repeatedly supported gentrification projects that affect the community in ways that force out diversity from Uptown and that have devastating effects on low-income communities and communities of color in Uptown," community activist Ashley Bohrer said at the protest. "Building affordable housing would be the best way to use public money for public services, and that means helping communities that are in the most need."
JDL's proposed upscale development, comprised of two high-rise towers with 749 total residential units and 554 parking spots, still needs approval from the city's Community Development Commission, the Chicago Plan Commission, the city council's zoning committee and the full Chicago City Council.
The development, which would include 26,000 square feet of commercial space, is planned for the former Columbus Maryville Academy site near the city's lakefront. The facility was previously an emergency resource center that housed women undergoing substance abuse rehabilitation and admitted their children to the Maryville Academy.
JDL's proposed project is located in the Montrose/Clarendon TIF district. The TIF district currently incorporates tax-exempt land, including the former Maryville site and Clarendon Park.
At Monday's meeting, officials from Cappleman's office stressed that the proposed $14 million TIF subsidy, if approved by the city, would not be awarded up front to the developer. JDL would begin to get paid from the TIF only after the development is built, occupied and has started to generate returns. If the project does not generate the projected returns, JDL would get less than the agreed upon TIF payment.
However, if the returns from the development are greater than the promised TIF payment, those extra funds would collect in the TIF district to be used for other projects in the defined area, such as revamping the nearby dilapidated Clarendon Park field house.
"There is confusion that money just surfaces, that someone gives the developer money, the $14 million, and that's just not accurate," Cappleman told Progress Illinois in remarks after the zoning meeting. "The entire TIF is unusual in that it is on tax-exempt property, so if nothing gets built there, it doesn't generate the money ... It's only if there is something built there that generates tax revenue that money comes forth."
JDL first introduced its Maryville redevelopment proposal to the Uptown community back in the fall of 2012. The previous year, another property developer Sedgwick Properties considered building two residential high-rises at the site. Sedgwick, however, eventually pulled out of the project after facing opposition from Uptown residents.
JDL's initial proposal included a larger $32 million TIF subsidy, with about $6 million of the funds to be set aside to renovate the Clarendon Park field house.
Cappleman said the project originally included an underground parking garage to be located on land owned by the Chicago Park District. The TIF funds for the field house were seen as a tradeoff for building on park district property, he said. But the parking garage idea was scrapped under JDL's proposal.**
"Once that changed, and there was no longer a parking garage there, there was no longer a tradeoff, which was very upsetting to me because I wanted money for the Clarendon Park field house," Cappleman stressed.
Jeffrey Littleton, one of the 46th Ward's zoning committee members, said the advisory board learned at its November meeting that the field house funds had been dropped from the proposal.
Although the overall TIF subsidy proposed for the project has since been scaled back, Ryne Polker with the Uptown Uprising community coalition still called it a "handout to the rich and robbery from the poor and the working class in our neighborhood."
"We are losing everything, and at every corner we are told that there is not enough money, there is not enough resources. We can't fund your schools. We can't fund your clinics. We can't fund your services," Polker said before the zoning meeting. "But hey JDL, we got millions of dollars for you, sincerely James Cappleman."
Polker and other Uptown activists argued that a TIF subsidy is not needed to entice a developer to build on the desirable lakefront property. Community residents have started a Change.org petition calling on Cappleman to dissolve the Montrose/Clarendon TIF district, which was set up by the the ward's previous alderman Helen Shiller. As of Tuesday morning, the petition had garnered 529 signatures online*.
The city's Department of Planning, however, has determined that the JDL project has met the so-called "but for" TIF clause, meaning that without the public subsidy, the property would likely remain undeveloped.
But Marc Kaplan of Northside Action for Justice said there should not even be a question as to whether JDL should get a penny of TIF funds. Kaplan pointed out that 77 percent of Uptown voters voted 'yes' in the March 2012 primary election on a referendum calling for TIF funds to be reinvested back into public schools and other units of government. The non-binding referendum also called for future TIFs to fund positive economic development, such as affordable housing and living wage jobs.
Officials from Cappleman's office maintain that the proposed JDL project is not technically going to take money away from public schools. That's because the current tax-exempt property in the TIF district has never actually contributed tax revenue to the Chicago Public Schools (CPS) district.
Nonetheless, Kaplan called the project "nothing but robbery."
"It's robbery of every one of our tax dollars to give to a developer to develop high-income housing," he said.
Under the city's Affordable Requirements Ordinance (ARO), JDL has to set aside affordable apartment units or money to help pay for more lower-income housing. Since the project is set to include a TIF subsidy, 20 percent of the units in the proposed housing complex have to be affordable.
The 46th Ward's advisory committee has requested that JDL set aside 10 percent of the units for affordable housing, meaning a household earning 60 percent of the median income could afford it. Littleton told Progress Illinois that an affordable one-bedroom apartment in the complex would cost about $1,050 per month.
To fulfill the remaining 10 percent requirement, the committee wants JDL to pay a fee per unit not set aside as affordable to the Low Income Housing Trust Fund, which provides rental subsidies to people earning 30 percent or less of the area's median income.
Cappleman noted that the second option could be a better approach, as the TIF project is within a census tract where 45 percent of the household income is $15,000 or less.
"So they are extremely poor, and we have people at risk of being homeless, so they would actually benefit by having rental subsidies," the alderman said.
Meanwhile, community activists said some 1,800 affordable housing units have been eliminated from Uptown since Cappleman took office in 2011.
In response, Cappleman said he is also troubled by the "very valid concerns about the loss of affordable housing" in the city.
"That's why I'm working with a number of different aldermen to expand the ARO, which is more confusion. People think as alderman I can require developers to put in affordable housing. I'm not allowed to do that. There's very strict requirements," Cappleman said. "They think aldermen have that power to force developers to do what they want. I can't."
* UPDATE: According to Uptown Rising, the effort has collected close to 2,000 signatures on the petition to dissolve the Montrose/Clarendon TIF district.
** A previous version of this story indicated that JDL carried over the underground parking lot in its proposal, which they did not.