Quick Hit Ellyn Fortino Thursday August 21st, 2014, 10:52am

CivicLab To Emanuel: 'Come Clean' About $1.7 Billion In Unspent TIF Funds

Volunteers with Chicago's CivicLab want a full accounting of the more than $1.7 billion that was sitting in the city’s collective tax increment financing (TIF) district bank accounts at the end of 2013.

Tom Tresser, co-founder of the CivicLab and leader of its volunteer-based TIF Illumination Project, said the group plans to file a Freedom of Information Act (FOIA) request with the city within the week to "demand the mayor to come clean" about how those unspent funds will be used. Tresser said the group is prepared to take legal action if the city denies the FOIA request.

"We asked for (similar information) last year, and they told us to go take a leap," Tresser said at a TIF discussion Wednesday evening at the CivicLab, 114 N. Aberdeen St. "This time, we're going to sue if we don't get it."

In its 2014 annual financial analysis, the city acknowledged that Chicago's TIF districts "had an aggregate balance of $1.72 billion at the close of 2013." However, the city said most of those funds, $1.67 billion, is "reserved for payments due in connection with committed projects, including a portion that is reserved to fund project costs in TIF districts where revenues are declining, in the event that annual revenues are insufficient to pay future obligations."

Tresser said the city needs to "prove" its claim that most of the unspent TIF money has already been assigned to economic development projects or is otherwise encumbered.

"What we are going to be asking for is a comprehensive list that says, 'If there is a committed [TIF] project that we don't know about, and if you have a contract, produce the contract,'" Tresser said. "That's pretty simple. So, are you going to be building another Mariano's in somebody else's ward, and you're going to give them 8 million bucks? Or 7 million bucks? We want to know now."

"If you're saying the money is committed because it's paying down debt ... for past projects, produce the payment books," he added. "And where are we in the debt? So, if we have a debt for a project that was in the ground 10 years ago, is it almost all paid for? Or do we (have) many more payments? And how much profit has the bank made? We want to know these things."

The TIF program, which was started under former Mayor Harold Washington and greatly expanded under Richard M. Daley's administration, began with the goal of eradicating blight, creating jobs and promoting economic development in underserved neighborhoods.

For those living in a TIF district, which typically has a life cycle of 23 years, a portion of their property tax dollars gets diverted from local units of government, like the school and park districts, and funneled into the TIF district's fund. 

In return, TIF money is doled out to companies for local economic development projects, such as a retail facility, that will supposedly generate future property taxes inside a TIF district. TIF money is also often used for infrastructure improvements as well as other public-sector and non-profit projects.

Through 2013, the city's TIF program has collected $5.5 billion in property tax dollars since it began in 1984, according to the CivicLab's analysis. The city's first TIF district, the downtown Central Loop TIF, which was created in 1984 and expired in 2008, collected on its own nearly $1 billion over the course of its active life. 

Last year, the 151 active Chicago TIF districts brought in $412 million in property tax revenue, the group's findings show.

The CivicLab also found that the city "ported" at least $145 million in TIF funds last year. Porting occurs when money is moved between adjacent TIF districts.

Nearly $44 million was ported in 2013 to the city's 24th/Michigan TIF District, which includes land near the McCormick Place convention center. Tresser said the TIF funds were likely ported to the 24th/Michigan TIF District from neighboring districts as part of the city's controversial effort to establish an entertainment district around McCormick Place.

In March, for example, the Chicago City Council agreed to allocate up to $55 million in TIF funds for the development of a new Marriott Hotel adjacent to McCormick Place.

Additionally, the CivicLab revealed that the city's Department of Planning and Development extracted nearly $7.6 million for staffing costs from 91 TIF districts in 2013. 

"You would think, since the Department of Planning and Development is a commission-level department, it's in part of the budget process, they would have gotten the money they needed to run their operation, but since they control the TIF program, they're able to skim millions and millions of dollars and say it's for staffing costs," Tresser said. "Now, it's so funny because when we ask for [TIF] information ... all of a sudden there's nobody at home ... It's too much work" for the department.

"They took seven-and-a-half million bucks," he continued. "I think that can buy some calculators, some accountants, some interns maybe to do this accounting work." 

Olga Bautista, a Southeast Side activist who plans to run for alderman in the city's 10th Ward, was at the CivicLab's TIF data presentation.

Bautista, who is also with the Southeast Coalition to Ban Petcoke, plans to make TIF reform one of her key campaign issues.

"This campaign is, more than anything, an educational campaign for my community — to be able to have this platform to talk about these issues," she said. "Win or lose, this is information that every single person in the 10th Ward needs to have."


Only the TIF Illumination Project (http://www.tifreports.com) can tell you ALL about the TIFs in your ward:

  • Over of how TIFs work in Chicago, history & scope
  • How many TIFs in your ward
  • How much $ these took from your ward
  • How much $ was left in those TIF accounts at end of year FROM your ward
  • What projects funded by TIFs in your ward

Here is an example of the kind of graphic we can produce to visualize all this vital data:

27th Ward

Contact us at [email protected]


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