May 6, 2017Tom Tresser

with research from Eric Unger

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The TIF Illumination Project

started in 2013.

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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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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).

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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

13Better Government Association

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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

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TIFs of the Hermosa Neighborhood

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Name of TIF TIF # Created Expires % in Community

In Community

Armitage/Pulaski 151 2007 2031 100%

Pulaski Industrial 069 1999 2023 50%

NW Industrial 064 1998 2022 25%

Adjacent

Belmont/Cicero 082 2000 2024

Galewood/Armitage 071 1999 2023

Belmont/Central 081 2000 2024

Portage Park 058 1998 2021

Near

Avondale 167 2009 2033

Fullerton/Milwaukee 087 2000 2024

Kennedy/Kimball 160 2008 2032

North/Cicero 035 1997 2020

TIFs of the Hermosa Neighborhood

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Armitage/Pulaski

Fullerton/Milwaukee

Fullerton/Milwaukee

Belmont/Cicero

Pulaski Industrial

AvondalePortage Park

Fullerton/Milwaukee

Northwest Industrial

Belmont/Central

Galewood/Armitage

Kennedy/KImball

North/Cicero

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Hermosa Area TIF Totals for 2015

Est. property tax extraction from 3 TIFs in community =

$2,472,050Est. property taxes left in accounts end 2015 from these

in community TIFs =

$10,189,973

Est. lifetime extraction for TIFs 100% and partially in ward =

$38,670,305

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Hermosa Area TIF Totals for 2015

Property tax extraction from TIFs IN and NEAR community =

$25,125,835Property taxes left in accounts end 2015 from these TIFs =

$103,033,995

Total expenses from these TIFs =

$18,693,179

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Hermosa Area Major TIF Funded Projects

$6,532,793 = public projects (8.6%)

$13,606,185 = nonprofit projects (17.9%)

$55,815,178 = private projects (73.5%)

[Largest = Brickyard Mall - $26,500,000]

[Monclare Senior Residence - $12,050,700]

[Florsheim retail & condos - $8,500,000]

[Hairpin lofts & retail - $7,151,770]

2 Home Depots - $5,775,915]

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

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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."

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www.tifreports.com

www.wearenotbroke.org

tom@civiclab.us

312-804-3230