As a member of the Cook County, Illinois board of commissioners, Mike Quigley has watched the City of Chicago create more than 100 tax increment financing (TIF) districts during the past 10 years, giving the city more than 140 TIF districts in all. Most of them are in already-prosperous sections of the city.
Now, with Mayor Richard M. Daley proposing a $550 million TIF district that would include the Chicago Board of Trade and the rest of the city’s high-priced LaSalle Central financial district, Quigley says the city has gone too far.
10 Percent Tax Shift
“Right now you get a property tax bill, and for businesses as well as Joe Citizen, that bill is 10 percent higher in the City of Chicago because of TIFs,” Quigley said. “If the mayor announced a 10 percent property tax hike, that would be headlines. We haven’t raised taxes 10 percent, [but] we’ve shifted the burden 10 percent. With this LaSalle Central TIF, it could be 13 percent. Here we have a hidden tax hike, and that’s wrong.”
The Chicago public schools and other local taxing bodies that receive property tax money from Chicago end up sacrificing up to 23 years of future revenue growth to these TIF districts, Quigley noted, forcing city and county taxpayers to shoulder artificially high tax burdens. Illinois also has allowed some communities to extend TIF districts an additional 12 years, meaning schools and other local taxing bodies will go 35 years without realizing any new revenue from the districts.
Quigley is calling for a moratorium on TIF districts in the city until the state determines whether the existing TIF districts are actually benefitting the city. He also wants to list TIF expenditures on the county’s property tax bills, so taxpayers can see how much of the tax burden is being shifted onto their shoulders.
Quigley said he knows he is a lone voice among local politicians in bucking Daley and the powerful monied interests that want TIF subsidies. And he knows aiming for a moratorium on TIFs and for transparency regarding their impact on property tax bills is a long shot.
But he said he’s standing firm, patiently trying to line up support among fellow Cook County Board members. That will be no easy task, as those commissioners include the mayor’s brother, John Daley, who runs the county’s Finance Committee.
In early October the Finance Committee killed two of Quigley’s proposals, though he may try to bring them up again. One would have required the county’s representative on a joint review board to consult the full county board before voting on whether to agree to a TIF. The joint review board is made up of members who represent taxing bodies that would be affected by a new TIF.
“Right now we’re just a rubber stamp for these things,” Quigley said. “Six entities are represented on the review board, and four of them are appointed by the mayor. It’s a rigged system.”
The Finance Committee also shot down Quigley’s request that the state study how TIFs are applied and whether the law is working as intended.
A third Quigley proposal still has life. That proposal would require tax bills to show how much is being paid into TIFs. Last year, more than $53 million that showed up on citizens’ tax bills under “Cook County” was actually diverted to TIFs, according to Quigley.
“I’ve had problems with TIFs before, but this [LaSalle Central] TIF would be in the central part of the Loop,” Quigley said. “TIF was created to redevelop blighted, rundown areas. How can anyone say here’s our blighted area, the Loop?
“We brag about the Loop, tell how great it is, show it off to visitors,” said Quigley. “There is nothing blighted about it. With this TIF, practically the entire Loop would be in a TIF district.”
Quigley continued, “They say this area needs a TIF because it is competing against other parts of the Loop. So we’ll be using TIF dollars to compete against other TIF dollars. I think we will find developers wrote the report saying we need to do this TIF.
“I am not anti-development,” Quigley said, “but there is no developer that would say he wouldn’t take that TIF money if it’s available. The City of Chicago has 45 TIFs that haven’t gotten their TIF money [for development] yet, and in 37 of them property values have been soaring anyway.”
Steve Stanek ([email protected]) is managing editor of Budget & Tax News.