South Side residents were shocked to learn at a Thursday night community meeting that the six active tax increment financing (TIF) districts in Chicago's 21st Ward had more than $1.6 million sitting in their collective bank accounts at the end of 2013.
The Chicago-based CivicLab revealed that TIF finding and relevant information at a meeting held at the Carter G. Woodson Regional Library in Roseland.
The $1.6 million in unspent funds would have otherwise been dispersed among the local units of government that rely on property tax revenue, including the school and park districts, were it not for the city’s controversial TIF program, which is intended to spur economic development in “blighted” areas.
The non-profit CivicLab launched its TIF Illumination Project, which highlights how the city's TIF program works at the ward level, back in February 2013. The group has held 30 community TIF meetings thus far.
Many South Siders at the meeting said they were unaware of the private projects that got TIF money in the 21st Ward, including a Home Depot and the Chatham Market shopping center that received a $32 million TIF subsidy.
"I think a lot of people have been getting a raw deal," Leatha Patton, a 21st Ward resident of more than 42 years, told Progress Illinois after the event. "These are things that the alderman should make you aware of. We should know how it works, and who gets what."
Michele Mcgee, a 10-year resident of the 21st Ward, said she wants to see unspent TIF money used on more public-sector projects in the area. West Chatham Park, for example, is "in desperate need of rehabbing," she said.
In all, there were 151 active Chicago TIF districts in 2013, which brought in a collective $422 million in property tax revenue last year. TIF districts typically have a 23-year life cycle. In 2013, the six active TIF districts in the 21st Ward collected nearly $760,000 in property tax revenue. That tax revenue gets extracted from property owners living inside a TIF district.
In return, TIF money is used for economic development projects, like a housing facility or retail project, that will supposedly generate future property taxes inside the TIF districts. TIF money is also often used for improving streets 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. Overall, the city of Chicago had more than $1.7 billion in unspent TIF funds at the end of 2013.
Ten percent of the 21st Ward is located in a TIF district, according to the CivicLab's findings.
An estimated $94 million in TIF money has been spent on public and private projects in the 21st Ward as of 2010, the group found. Of those projects, 69 percent were private and 31 percent were public developments.
The public projects include various infrastructure improvements and the Neal F. Simeon Career Academy High School, which received more than $28 million in TIF funds, the group's findings show. Private projects include the Home Depot at 200 W. 87th St., which got a $3.2 million TIF subsidy.
"Last time I checked, they were a multi-billion dollar corporation," Tom Tresser, co-founder of the CivicLab and leader of its volunteer-based TIF Illumination Project, said of Home Depot. "Are you telling me that Home Depot would not come into your community" without a subsidy?
"Do you think a billion dollar company would come into a place where they're going to lose money," Tresser asked about two dozen people at the meeting. "To me, this is one of the essential questions of this whole project: Under what circumstance do you give a private company" TIF money?
Patton also took issue with the Home Depot TIF project.
"I can't understand why Home Depot would be getting $3 million," she said. "Why would they need it? That's what their ... customers are for —to bring the money in to them."
The largest private TIF project of nearly $32 million was the Chatham Market shopping center at 83rd Street and Stewart Avenue. The Chatham Market currently includes a Lowe’s Home Improvement store, Potbelly Sandwich Shop, Walmart Supercenter, Chase bank and other stores.
Mcgee believes the $32 million subsidy for the shopping center was a "poor use" of TIF money. She said the businesses at the shopping center, or others like it, would have likely come to the community without the TIF-funded development.
Businesses "will go where people are spending," she said. "They would have come. Maybe not as quickly (without) this grant, but they would have come, because the consumers are there."
She also noted that "there is trash everywhere" at the Chatham Market, and the shopping center has too few security officers.
"They're not policing their property, especially Walmart," Mcgee said. "I'm not saying, 'Walmart is bad. Get rid of the big businesses,' ... But they can do more, and our elected officials have to make them accountable."