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Friday, May 24

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The Mechanics

Election 2015 Mon Dec 22 2014

Fioretti Talks TIF Reform

Ald. Bob Fioretti of the Second Ward has the platform of "True TIF Reform" for his mayoral campaign. I spoke with him over the phone on Friday to discuss TIFs and how to reform them.

One of your platforms is "True TIF Reform." What projects under Mayor Emanuel have led to you developing this platform?

A meeting -- I think it was the Finance Committee meeting, I do not serve on the Finance Committee -- and I watched what happened with a TIF on the Far West Side where the aldermen had not done anything to improve the infrastructure. And many African-American aldermen complained about the lack of use in terms of the infrastructure and at that point I had come to the realization as I watched what happened our TIF program is broken. I mean, it's there to help blighted areas and instead we see most of the money being directed to the South Loop, West Loop, Downtown area. And, accordingly, short-changing our neighborhoods like Pullman, Riverdale, Roseland, West Pullman, South Side communities where blight is, as I said before, prevalent and economic development is scarce.

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Monica Reida / Comments (1)

TIFs Tue Feb 11 2014

DePaul Students, Faculty Take Stand Against Planned Arena

DePaul University student activists are trying to halt the new $173 million basketball arena construction project, which is currently set to begin later this year.

The student organization, the Contingent for an Alternatively Funded Arena, has been working since the plan to build an arena was announced in May, approximately a week after 54 Chicago Public Schools were voted be shut down.

CAFA has plans to meet with DePaul's president again on Feb. 20, as well as Jeff Bethke, DePaul's treasurer. In the organization's second meeting with the administration, it hopes to make many arguments to persuade the university heads to back out of the project and not pull out a nearly $70 million loan.

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Rima Mandwee / Comments (6)

TIFs Fri Jul 12 2013

County Clerk Orr Sounds Quiet Alarm on TIF Overuse

Cook County Clerk David Orr, in a half-hour July 12 press conference releasing his office's required 2012 tax increment financing ("TIF") revenue report, highlighted the enormous amount of revenue siphoned from Chicago and Cook County taxpayers into TIF districts, and called for early declaration of surpluses within Chicago to fund needs like schools. Observing that billions of dollars have flowed into the now-over-500 districts, Orr released a video (embedded below) on the Clerk's website to help taxpayers grasp how the little-understood mechanisms work.

The video's tone suggests a school science filmstrip, kind of quiet in view of the alarming numbers, but this is government, not advocacy. At 2:41, over soothing guitar arpeggios, a pleasant female narrator says, "In most cases, taxpayers outside the TIFs pay more to generate the revenue requested by [their own] taxing districts." TIF critics such as the Reader's Ben Joravsky have hammered relentlessly on this, how TIFs hike your taxes, but it's easy to miss in the video unless you pause.

Orr's press conference was both longer and stronger than the official video. Noting that Chicago's collective TIF districts pull in half as many tax dollars as the City itself, Orr expressed concern that so "many taxpayer dollars are diverted into the Loop," charged that "not enough is being done in the neighborhoods," and that there has been little transparency as to how $5.5 billion in TIF dollars has been spent. He urged Mayor Emanuel and the City Council to declare a TIF surplus this year "as soon as possible" for the benefit of Chicago Public Schools, asking, "How do you explain to the kids in many of these schools that gym, music and art classes are cancelled while profitable businesses downtown ... received 25, 30, 40, 50 million?" Good question.

While Orr's remarks centered on Chicago, they echoed the same requests made by pressed suburban taxpayers for more transparency and accountability, better metrics, declarations of surpluses, and early retirement of no-longer-needed districts.

Overall, the video capably illustrates TIF workings and numbers, whose magnitude needs time to sink in, and Orr deserves credit for shining further light on what is now a gargantuan but opaque component of local governmental taxing and spending.

Jeff Smith

TIFs Thu Jan 10 2013

Chicago's TIFs Have a New Watchdog

The TIF Illumination Project is a new crowd-sourcing effort dedicated to investigating Chicago's Tax Increment Financing (TIF) districts. Tom Tresser, a Chicagoan and veteran civic organizer, is leading the project.

The goal of the TIF Illumination Project is to give local residents a better idea of how TIF funds are used. "You have to force the city to explain themselves, and I don't think they're going to be able to do it in a really convincing manner," said Tresser in an interview earlier this week. "I don't think this program is going to hold up to scrutiny."

Chicago began using TIF districts as an economic development tool in 1984. A TIF freezes the amount of property taxes schools and local government take in from a set district for a 23-year period. New tax revenue generated from increased property values is diverted into funds used by the city. Those funds must be used within the district or a bordering district.

The TIF Illumination Project has started examining the TIF districts in the 27th Ward. They research how much revenue the TIF received and where the money went. Then volunteers will call each recipient and ask how the money was spent. "I'm imaging that most people are going to hang up on them," Tresser said, but added, "I'd like to get people up on the balls of their feet about this." Tresser emphasized that the project is not only about research. "We're not just building an app or running a program and letting it go. We want to take our findings into the community."

Tresser will be speaking in a town meeting organized by the Tax Integrity and Fairness (TIF) Alliance on Tuesday, February 12th from 7-9pm. He will be speaking alongside Ben Joravsky and Dr. Richard Dry. The evening will include time for break out sessions, including one lead by Tresser titled "Become a TIF Illuminator."

The TIF Illumination Project also plans to run a flier insert in AREA magazine's housing issue in early March. The inserts will explain TIF districts and the revenue they generate in the neighborhood, and invite the public to take part in the project.

Tresser sees a potential for the project to grow, but emphasized the importance of it being a local effort. "This is where you live. This is your house. This is your property tax bill. Let's start with that."

Julie Davis / Comments (3)

Chicago Public Schools Tue Jun 05 2012

REPORT: TIFs Exacerbate Neighborhood Inequalities

As the education privatization reforms spread across the country (from Chicago via D.C.), a report out of Roosevelt University threatens to add fuel to the fire of privatization critics, particularly here in Chicago.

The study, by sociology professor Stephanie Farmer, examines how tax increment financing (TIF) funds have been spent on schools. TIFs are controversial financing mechanisms originally created to allow cities to fund development in blighted areas by dedicating property values above a specific amount to projects within those areas. Thanks in no small degree to the work of Ben Joravsky of the Reader (and the now-defunct and terribly named Neighborhood Capital Budget Group), TIFs came to the public attention as de facto slush funds, with little or no oversight, used to divert property tax revenue (mostly from the schools) to be used as "incentives" or givebacks to developers. Because the revenues diverted into funds come from property taxes, the Chicago Public School systems has consistently been the biggest loser in the TIF craze.

Farmer's study does little to assuage the public's concerns. In it, Farmer finds that

CPS's top priority for the allocation of TIF revenues to school construction projects is to support selective enrollment schools....Though selective enrollment schools account for 1% of all CPS schools, they received 24% of all TIF funds spent on school construction projects.

It is hard to merely call it a "perception" that TIFs have been abused to accelerate gentrification, thus substituting displacement for economic development. That selective enrollment and charter schools received more than a third of all TIF funds spent on school construction and improvement projects isn't just an isolated fact. School quality is a strong, if not the strongest, component that determines not only property values but the attitude of young families and professionals to a neighborhood. Therefore diverting funds from CPS by creating a TIF, and then disproportionately spending that TIF money on already-elite schools actively harms the city's working class neighborhoods.

See the full report here.

Ramsin Canon

Privatization Tue Apr 24 2012

Capital Strikes, Capital Flight, and the Wholly Privatized City

In approving with no modifications Mayor Emanuel's infrastructure trust plan today, the City Council took another step towards ensuring their own irrelevance and wholly privatizing the operations of Chicago. It also took another step towards building up the Mayor's 30-second campaign commercial for whatever higher office he's envisioning (so far, he's got "won the longest school day in the country" and "made the tough decisions to balance the budget"; of course, "took on the special interests (workers)" is a given). They can't be wholly blamed, though. There's little room for them, or any local (and even state) legislatures to maneuver. The corporate tactics of capital strikes and threats of flight have proven their worth. Cities and states have been starved for well over a decade, and now we're reduced to auctioning off what we own to meet our obligations.

In a piece on the Infrastructure Trust last week, I said that it wasn't an inherently terrible idea, in part because there's really no other feasible way to raise the money. Issuing general obligation bonds wouldn't be terrible different, the federal government doesn't spend money on infrastructure any more (at least not in a direct way not routed through private pockets) and the city's wealthiest institutions and individuals are unwilling to pay higher taxes--in fact, are unwilling to pay any taxes that aren't offset by massive welfare entitlements, as the ongoing tax increment financing boondoggle demonstrates.

Taking a step back and considering the broad view, this is an astounding progression of events. Over the last 25 years, Chicago's corporate and political leadership has drained the city of revenue through creation of TIFs as a condition to invest capital in neighborhoods--the whole point of a TIF is that available capital is being withheld until the public provides better incentives for its investment. The billions of dollars diverted into these funds contribute to not only to budget shortfalls but, amazingly, increase taxes on middle class taxpayers, as the school district and other bodies have to raise their tax levy to meet their obligations.

At the same time, the city's corporate powerhouses not only withhold investing capital without generous givebacks, but also threaten to leave if their taxes (euphemistically called the "business climate") are not satisfactory.

The result is a public sector starved of revenue which must then turn to selling off (or "long-term leasing-off") its assets. This in turn, by the way, reduces a city's credit-worthiness even more, making it more difficult to issue bonds in the future and narrowing the city's tax base.

This isn't just random dot connecting; it's actually how investors view Infrastructure Trust vehicles. Consider this bit of finance news from last year:

Earlier this month AMP Capital Investors was appointed by Irish Life Investment Managers to advise on its $1.5bn Irish Infrastructure Trust. The fund is expected to acquire key assets such as airports when the Irish government begins selling down assets to meet its obligations.

And this:

[The Irish trust] will provide crucial liquidity to a sector which has, and will continue to be, squeezed of capital. At the same time valuations for infrastructure assets should be low, given the weak macroeconomic outlook, with BMI anticipating a double dip recession to hit in 2012.

Investors in infrastructure trusts are not interested in helping communities (we, a community, are leasing the assets) getting to a place of healthy revenue capable of meeting obligations and investing in long-term projects. To the contrary; the more a community is starved of revenue, the more it'll have to auction off assets. The more it has to auction off assets, the fewer options it has to raise revenue. And on and on.

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Ramsin Canon

TIFs Wed Feb 08 2012

The Golden Toilet Strikes Back!

GoldenTiolet.JPGProtesters brought out the golden toilet once again in a rally aimed at Mayor Rahm Emanuel, demanding that he designate TIF funds towards jobs at schools, libraries and clinics.

The gilded john was marched to City Hall, where protesters associated with the Grassroots Collaborative were told it needed to stay outside.

Continue reading this entry »

Tyler Davis

Op-Ed Wed Feb 01 2012

Are Rahm's Proposed TIF Reforms Enough?

by Celeste Meiffren

This week, Mayor Rahm Emanuel announced that he will be immediately implementing some of the reforms proposed by his Tax Increment Financing (TIF) Reform Panel five months ago. All of the proposed reforms are necessary to fix TIF and need to become law before more of our tax dollars are wasted.

Every year, $500 million worth of property tax revenue collected from Chicago taxpayers flows into a funding pool that, up until very recently, has been completely off the books--allowing for an out-of-control spending spree to well-connected developers and other special interests.

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Good Government/Reform Tue Sep 27 2011

Chicago Inspector General Offers Budget Ideas, Politics-Free

The Chicago Inspector General, Joseph Ferguson, released a report this morning with recommendations to the city government as to how it could close its considerable budget deficit.

There is constant harping in this space (e.g., from me) about the need for democratic control of institutions and meaningful public input into public processes. Any more than a little complaining about constant deference to more or less unaccountable technocrats. Make no mistake, though--technocrats and experts--and insular bodies--do have an important role to play. One of the best things about "third party" bodies that are insulated from politics yet still part of government is that they can make findings and issue recommendations free of the type of political considerations that the elected incorporate into everything. (Which is just one of many reasons why the IG's office should be well-funded and protected from meddling).

At the same time, being part of government means the recommendations these bodies make carry more weight, generate more instant attention, and carry some imprimatur of officialdom. So I read the IG's report with some interest late last night and early this morning.

One of the things that will strike you right from the executive summary is that a number of these recommendations could save enormous sums annually with fairly straightforward actions. It takes only another moment before you realize that they would be unpopular either with powerful special interests or with casual voters. Creating a 1% city income tax, for example, would cause a stir, and Mayor Emanuel has not shown the particular style of political courage necessary to try something like that. Similarly, this administration is unlikely to take the common sense step of eliminating some of the legions of appointed supervisors who supervise ever fewer employees but enjoy high salaries and benefits.

By Ferguson's estimation, that latter change could save the city as much as $100mn a year.

The option that generated buzz this morning was transforming Lake Shore Drive into a toll road, which is unfortunate because there are a lot of other common sense suggestions that, in the short term at least, could balance the city's budget without necessarily wreaking havoc among working families, including (from a release):

· Eliminating all Tax Increment Financing Districts to increase tax revenues to the City's general fund by an estimated $100 million annually

· Increasing the work week of all City employees to 40 hours to save approximately $40 million annually

· Create a Commuter Tax estimated to generate $300 million in annual revenues

· Implement Congestion Pricing for vehicular traffic that is estimated to generate an additional annual revenues of $235 million

· Broadening the City's Amusement Tax which would produce an additional $105 million in annual revenues

A lot of this is necessarily unlikely. They would be major, if simple, changes, and Emanuel's entire political career is one of risk-aversion, and the City Council is not really equipped to take any initiative. Still, having a body in government that can put forward options and recommendations like this, to at the very least make the public aware of what is conceivable and possible--and what politicians are unwilling, for their own person political reasons, to do--is essential to good government.

To read the full report, follow the jump. Also, check out IG Ferguson on WBEZ's 848 this morning. (I was on after him).

Continue reading this entry »

Ramsin Canon

Urban Planning Mon Sep 19 2011

TIFs and the Race to the Bottom

Phil Rosenthal had a great piece in the Trib about the core policy questions that arise in the debate about TIF: Who needs subsidies? Working families? Or big companies?

On the one hand, you have unceasing waves of foreclosures hitting Chicago neighborhoods, contributing to blight, affecting property values, and, most importantly, putting families out of their homes. Without question, these harm a local economy.

On the other, communities need jobs. The flight of manufacturing from Chicago degraded the city's middle class significantly, and only an infusion of professionals to gentrifying neighborhoods has kept the median income steady. If employers are only willing to relocate with lavish subsidy, whatever our ideological or moral objections, it may be necessary.

Add to this a third layer: to what degree are we actually solving a problem, and to what degree are we shuffling deck chairs? From Rosenthal's piece:

"It depends on how you view the geography of our economy," said Rachel Weber, an associate professor in urban planning and policy at UIC. "If you think of the upper Midwest as one interlinked economy that competes with Europe and China, then moving these pieces around is not necessarily a benefit. If you look at it from the perspective of the city of Chicago, this is a winner. It depends on the scale of the economy you think matters most."

Beyond the process concerns, one of the challenges that TIF-style economic development presents is stability. TIFs are a weapon in the battle between communities and states to lure business away from one another, which changes the net but does nothing to the gross: the pie doesn't grow, in other words, between regions and states. How many subsidies are enough? What's to keep a company willing and able to chase the best benefits from staying put long enough to truly plan around?

Mayor Emanuel, like his predecessor (whose name is not "Mayor My Predecessor" as Emanuel would have you believe), has an intense policy focus on keeping Chicago a "global city." As the global economy has become more and more integrated and capital freed from parochial bonds since the 1970s, the "global city" idea has majorly informed of metropolitan areas has formed the basis of urban planning.

In her influential book Cities in a World Economy, Sasskia Sassen teased out what this often amorphous concept of a "global city" means:

[T]he forty or so cities that currently qualify as 'global cities' fulfil three major functions. They are command and control centres for the organisation of the world economy, key locations and marketplaces for finance and specialised services, and also major sites of production, including the production of innovation. [Sassen] stresses that global cities cannot be treated as single entities and that their social and cultural determinants must be taken into account to understand their economic trajectories.

The intense specialization and capital requirements of these functions requires significant infrastructure and social capital investment. Like the human brain, they consume a lot of resources. The professionals and the social networks in which they move require certain modes of urban living, access to major research institutions, access to power, and generally little interference from the state. Requirements like these often come to the detriment of the type of "neighborhoods first" governance that was the center piece of Harold Washington's reforms in the 1980s. Thus the constant friction between funding for "downtown" and Millennium Park versus investment into "the neighborhoods" and relief for cash-strapped families.

Competition for international capital and the industries, social networks, and professionals that accompany it is only sharpening. What's more, the policies needed to compete can seem to the public to be a series of desperation measures to stay relevant, with investment in working class communities forever put off into some future where there is some stability. And if the fictional wealth bonanza of the 1990s taught us anything, even seemingly dynamic changes to the fundamentals of the economy can be illusory. The example in Chicago is stark: the collapse of the housing market led directly to the tanking of Chicago's revenue base which was kept afloat by huge surges in Real Estate Transfer taxes.

The race to the bottom indicates there is a bottom, but the analogy can't be stretched too far. In reality, what is considered an acceptable level of social spending is constantly revised downward, the public common is consistently narrowed, and neighborhood participation in planning low-rated into oblivion.

Still, the abuse of TIFs by Mayor My Predecessor has given them a bad name, but they are not by any means inherently bad. To the contrary; one can easily imagine how TIF districts could be used as a tool for community control over and input into local planning and development decisions. A first step to resolving the type of tension Rosenthal reported on is to work towards some kind of consensus on the question of what makes a city prosperous, and to what degree our "global city" position needs to be balanced with true local ownership over policy and planning.

Ramsin Canon

TIFs Tue Sep 06 2011

A Look Behind: Mayor Emanuel's TIF Commission; What They "Do and Don't"

Last Monday, Mayor Rahm Emanuel made good on his campaign pledge to reform the Chicago's sprawling Tax Increment Financing (TIF) program. So it would seem from scanning the headlines. Or maybe it's time to double-down on cynicism, because nothing has changed.

Hard to say, really, since there's been precious little analysis of what Emanuel's TIF reform panel actually proposed.

(For a quick refresh of how TIFs work, click here and here.)

So let's take a look. At bottom, their report urges the city to adopt four simple, technocractic habits:

Continue reading this entry »


TIFs Tue Aug 30 2011

Carole Brown on Chicago Tonight Talking TIFs

What jumped out at me was Brown saying that the public was mistaken in believing that tax increment financing districts were meant only to address blight. An area being blighted is actually in the TIF statute as among the necessary conditions for creation of a TIF. Hard to see how those statements can both be reconciled.

Ramsin Canon / Comments (1)

TIFs Mon Jul 11 2011

Where Do We TIF From Here?

Chicago is perhaps the best place in the country to see the impact, both good and bad, that Tax Increment Financing districts can have on a city. TIF districts - those peculiar redevelopment schemes that hold the line on current property taxes within a designated area, and then funnel all future property tax increases straight back into redevelopment (as opposed to financing basic public services) - were nearly always on standby during Mayor Richard M. Daley's tenure. At their best, Daley's TIFs solidified the tax base and quarterbacked increased development in certain areas, most vividly seen in the Central Loop TIF.

Begun by Mayor Harold Washington in 1984, when the Loop did indeed contain areas of blight, Daley extended the life of the Central Loop TIF to seemingly great effect. Before eventually expiring in 2008, the TIF district helped spearhead the Loop's renewal, ushering in an era of huge expansion that increased the tax base and businesses within its borders, and saw a rise in the estimated assessed land value in the district to $2.6 billion from its original $985 million. The renewed strength and vibrancy of Chicago's core allowed the city to comeback from its "buckle-on-the-Rust-Belt" lows, and become a relevant player on the Global City index.

Of course, the Central Loop TIF is but a tiny part of the story. While TIFs can be great vehicles of investment in neighborhoods, often they are not the simple fix for areas that they portend to be. For starters, the subjective assignment and creation of TIF districts skews the market and incentives for development where demand is inherent. In Chicago, where the disparity between TIF districts is immense, one man's blight is another man's aspiration. Nearly no one would argue with the fact that the destitute area surrounding the Ogden/Pulaski TIF district in the Lawndale neighborhood displays a greater need for subsidy-induced development than Chicago's Loop. Yet, Daley's downtown focus ensured that the "blighted" CBD continued to be invested via TIF well-beyond its logical expiration.

Continue reading this entry »

Ben Schulman

Technology and Politics Fri May 27 2011

Chicago's Data Starts to Open Up

The Emanuel administration is still settling in, but some changes are already showing up online. The City's data portal now offers an RSS feed of newly created and updated data sets, and the portal is moving beyond FOIA requests to include other data sets, such as the 20 most popular fiction books checked out of the Chicago Public Library and a huge cache of TIF-related documents.

Chief Technology Officer John Tolva said by instant message, "We're only dribbling now. Expect a steady stream." Starting today with the release of building permits data, Tolva said his department plans to being "what we believe will be every-other-day releases of nightly updated sets."

In addition, Tolva and Chief Data Officer Brett Goldstein now have Twitter accounts. Goldstein recently tweeted a link to the City's Open Data API console, where, if you're technically inclined, you may query the database directly.

"We're releasing all this for many reasons, transparency/trust, accountability/efficiency, but also -- and this is important to Brett and I -- to engage makers in building things and helping the city -- providing the public resource for a new kind of civic engagement," Tolva said.

As more substantial data is released, we can expect developers and urban technologists to create tools for exploring and working with the information, much like we saw once the CTA allowed developers access to their bus tracker API.

Andrew Huff

TIFs Tue Apr 19 2011

Testing TIF Mettle

This article in a metals industry blog details how Mayor Daley used tax increment financing (TIF) money to subsidize the move by A. Finkl & Sons steel to the South Side, keeping between 350 and 500 jobs in Chicago:

Big news last week for the Chicago steel industry when US steel producer A. Finkl & Sons Co. received a hefty chunk of change -- $20.5 million - from the city's Community Development Commission in TIF money to move operations to the former South Side site of Verson Steel (instead of picking up and moving to Canada). Tax Increment Financing (TIF) is a hot-button issue in Chicago, as many city officials, including outgoing Mayor Richard M. Daley, favor it as a way to incent local business development to spruce up blighted neighborhoods, while detractors say the property tax freeze that the government offers on these properties diverts money from local schools (yet somehow manages to get funneled into the pockets of Daley officials and their favorite developers).

Going with the higher number of 500 jobs, that comes out to about $40,000 per job. Finkl's new digs will be at 93rd and Kimbark on the far South Side, in the 8th Ward. On first inspection, this looks like exactly the type of thing that tax increment financing was meant to do--but of course, first inspections are rarely determinative. Still, in all the heat over TIFs, it's good to look at cases such as this to determine just how the program can be used to serve the public good.

But I'm open to arguments to the contrary--what do you think?

Ramsin Canon

Housing Thu Jan 13 2011

Capitalizing on Foreclosure: TIFs and Housing

Sweet Home Chicago, a coalition of housing advocates, continue their push to use tax increment financing (TIF) funds to purchase and rehab foreclosed properties and provide them as affordable housing. This seems like a reasonable idea; no need to reinvent the wheel, though, I'll just go ahead and quote Progress Illinois' Micah Maidenburg who said it so well:

Foreclosures radiate outward. Lawns don't get mowed, maintenance is deferred, and empty homes with boarded-up windows are prime targets for vandalism. Property values decline -- each home within 250 feet of a foreclosure loses 1 percent of its value due to the dispossess, according to one study, and the worth of the seized home itself sinks by 27 percent. When a few foreclosures cluster on a single block, entire neighborhoods swing into reverse. Gloria Warner, a member of the community group Action Now, described at a press conference yesterday how foreclosures are socking her community in West Englewood:

On its face, the proposal would ameliorate the social repercussions of the foreclosure crisis, while also achieving to some degree "scattered site" affordable housing, which is key to breaking the pattern of ghettoizing the city by social class and race. There is some evidence that residents have more incentive to take care of and protect their residences in scattered-site programs.

One question that comes to mind: would relying on TIF money to maintain a scattered-site housing program prevent needed reforms to the TIF program?

Ramsin Canon

Education Tue Sep 28 2010

The Kids Who Fight For a Library

The parents of students at Whittier Dual Language School have been fighting for seven years to get a library built for the school. They learned about Tax Increment Financing (TIFs), they created petitions, they called press conferences. And 12 days ago, after finding out about a demolition order for the field house that parents call "La Casita," the parents decided occupying the field house on school property to prevent it from being torn down, was the only way they may be able to get the library they felt their children deserved. So they've spent the night in the field house to prevent it from being demolished and have started taking book donations (with a great deal of help from Chicago Underground Library) to create the library on their own.

Gapers Block published an article on September 18th and Anne Elizabeth Moore has written more than a week's worth of posts about the parents' fight to save La Casita from demolition.

Most of the attention has been focused on the parents, the sturdiness of La Casita, and the lack of response given by Chicago Public Schools to the parents. But I was curious how much the children at Whittier actually cared about having a library. Statistics show us that kids aren't reading for fun as much as they used to, kids spend more time playing video games than reading, and getting boys to read just isn't going to happen.

So with the permission from their parents, I sat down and talked with four students at Whittier Dual Language Elementary School. Their parents weren't present for the interview and seemed quite comfortable trusting me to talk with their children within eyesight, but not earshot. Most of the parents did tell their children to only talk to me about "la biblioteca." Most of the kids nodded serenely and politely before moving to the playground to talk with me. Raul rolled his eyes when his back was turned to Guadalupe, his mother, and said to me, "It's like she can read my mind sometimes! How did she know I was going to tell you all our family secrets?" He then laughed and said, "I'm just kidding with ya."

Continue reading this entry »

Cinnamon Cooper / Comments (5)

Media Mon Sep 20 2010

Around the City Reads

Some good stuff to catch up on this morning:

CBS 2: Daley Mentored Others as He Shaped Chicago: But he's still "absolutely the best mayor in the country," Berry said. "Nationally there's no question he's been probably one of the most successful and important big-city mayors in the last couple decades."

Progress Illinois: Shift Expected at CAPS: The ground continues to shift at the Chicago Police Department. On Thursday, outgoing Mayor Richard Daley said he wanted civilians rather than uniformed police officers to run the Chicago Alternative Policing Strategy (CAPS) program. Ron Holt, the CAPS director, told the Tribune that too many of the 200 to 300 officers assigned to CAPS were doing administrative and civilian tasks. Many are expected to be reassigned to patrol work.

In These Times Working Blog: Hotel Quickie Strikes Build Union, Workers' Determination for Contract Battles: Workers in Chicago, like most of these cities, are responding with overwhelming strike authorization votes, protest rallies, sit-ins and civil disobedience, campaigns to persuade organizations and individuals to boycott certain hotels, and-last week-a planned one-day strike against hotel union UNITE HERE's national target, Hyatt, in four cities.

People of Color Organize!: Solidarity With Whittier School Occupation: The Whittier Parents' Committee has been organizing for seven years to push Pilsen alderman Daniel Solis to allocate some of the estimated $1 billion in Mayor Daley's TIF coffers to their school for a school expansion - he finally agreed to give $1.4million of TIF funds for school renovation. Cynically, Chicago Public Schools (CPS) has earmarked a part of this money for the destruction of the school's field house, which has been used for years as a center for community organizing and services. This would directly undermine the ability of the Whittier community to organize and struggle for educational rights. Parents are demanding to be part of the decision-making process.

Austin Talks: March against violence challenges community to fight back: Graham urged residents to take a stand against gun, gang and domestic violence. Rev. Jennie Jones of Pleasant Ridge Missionary Baptist Church led the group in prayer and pleaded for strength in the fight against violence plaguing Austin.

Chicago Union News: Adjunct faculty at Chicago college cries foul while trying to organize: With only a few weeks until fall classes begin, some part-time instructors at East-West University in Chicago's South Loop are still waiting to see if they will be hired back to teach after what has been a "messy" summer-long conflict involving efforts to unionize.

Ramsin Canon

Education Mon Aug 30 2010

Catalyst Report On Charters Demonstrates Duncan's Record of Failure

That Arne Duncan is a professional failure has never really been up for much debate. He achieved precisely zero of his objectives as head of the schools in Chicago, and failed upward into the President's administration mainly for his skills at self-marketing and the President's bizarre desire to appear "tough on teachers".

Catalyst Chicago in its latest issue[PDF] is digging into what teachers and parents have known since at least 2005: that the Renaissance 2010 program is a disaster, that privatization and charter schools have done nothing but increase opacity, decrease accountability, and aggravate the bifurcation of the school system; and that whatever improvement CPS has seen since the Mayor took over the school system in 1995 is due not to the free market unicorns sneezing their econowoozle magic on the evil teachers unions, but to gentrification.

As opponents of public school privatization have warned for years, the fascination with "innovation" and "entrepreneurial spirit" is hanging the hopes of a generation on buzzwords and sloganeering. There is no evidence, nor has there ever been, that introducing profit motive and private sector slash-and-burn sensibility would add value to education. Indeed, it hasn't been. What a surprise: firing master teachers and destabilizing the work force has NOT lead to an improvement in retention in poor schools and has not somehow magically improved classroom instruction.

As the Catalyst study points out:

  • On average, charters lost half of their teachers over the past two years, a turnover rate that rivals many low-performing neighborhood schools.
  • Only 16 of 92 new schools have reached the state average on test scores. Of those 16, just eight are charters. The rest are new magnet schools or new satellites of existing magnet and selective schools.

Just as public education advocates have been saying, introducing private operators into the school system with little oversight simply accelerates the problem of bifurcation. Charters are competing with each other for the best students and leaving the public school system to educate kids with poor performing kids, kids with learning disabilities, and kids from the poorest communities. Oh, and kids from multi-lingual households: Latino kids are particularly left behind according to the Catalyst study. The proportion of Latino kids attending high-performing schools has not increased at all since Renaissance 2010 began in 2004.

And, just as predicted, charters inherently prejudice students with highly involved parents, as this story heartbreakingly illustrates:

This spring, Charise Agnew was forced to confront the lack of school options in Roseland as she made an agonizing decision about where to send her older son, Dorian Metzler, to high school. Dorian was one of the top 8th-graders at Lavizzo, one of the lowest-performing schools in the city. In 2010, only about 44 percent of students met or exceeded state standards on the ISAT. Agnew had her heart set on Dorian attending Gwendolyn Brooks College Prep, a selective enrollment school just to the west of Lavizzo. She had him apply, and then she waited. But Agnew didn't know that Dorian needed to take an entrance exam. Few students at Lavizzo score above the 70th percentile on the ISAT, the cutoff to take the selective enrollment test. So there was no buzz in the hallway. A teacher might have asked about it, but the original 8th-grade teacher was fired and the class had a substitute for two months.

The end result is that no one tapped Dorian or Agnew on the shoulder to tell them about the entrance test. "I just had no idea," Agnew says.

Brooks is the only higher-scoring high school in the area. Agnew's first reaction was to take Dorian's transcript up to Brooks and try to talk to the principal. But selective enrollment school principals can be inundated with pleas from parents to offer their child a slot. Schools set up shields, and Agnew didn't make it past the foyer.

A woman like Charise Agnew is undoubtedly an involved and interested mother. But in an education system perverted by the neoliberal fascination with competition and markets, even her children end up losing out.

Ramsin Canon / Comments (1)

TIFs Mon Aug 23 2010

TIF for That: Fritchey Teams Up With Teachers, Parents on Reform

State Representative John Fritchey, who will be giving up his seat in the state house representing the 11th District to replace Forrest Claypool on the Cook County Board of Commissioners (assuming he wins in November), is teaming up with the Chicago Teachers Union and the Raise Your Hand Coalition to push comprehensive reform of the tax increment financing, or TIF, program. The reforms could end the exploitation of TIFs by the Mayor's office as a cudgel, and restore significant funds to taxing bodies--particularly the schools--that have seen billions of dollars disappear over the last couple decades.

Tax increment financing was created by state statute in the 1970s as a way to provide incentives to develop blighted areas. TIF areas are designated by municipalities; within those areas, property tax assessments are frozen at the level they were at when the zone was designated. The land is still assessed and the taxes on the increase are still collected, but they are diverted into a site-specific fund rather than being paid to the various taxing bodies that typically collect them. Those bodies are, primarily, school districts, counties, the municipality itself, and sanitation and fire districts, among others. The idea is that without the incentive, that tax money would never have been raised in the first place, and so those taxing bodies are not actually losing anything.

Continue reading this entry »

Ramsin Canon / Comments (3)

TIFs Wed Jun 30 2010

City's Inspector General Has Some Words on TIFs

The city's Inspector General, Joseph Ferguson, sent the Mayor an audit on several city TIFs, and the result confirms what TIF critics have been saying: that no matter what the potential benefits of so much TIF creation, the lack of transparency both to the public and to public officials is leading to waste and corruption. TIFs, or Tax Increment Financing districts, are special taxing districts that freeze the property taxes paid to the usual taxing bodies (mainly the school district, County, and park district) and diverts that money into a special account meant to finance development.

The report, dated yesterday, details numerous ways the lack of public accounting for the TIF funds resulted in wasteful spending, abuses, and corruption. The audit criticizes the city for lacking sufficient "internal controls" as required by the state statute that authorizes cities to create TIFs.

Of the litany of problems with TIF management the IG cites, this one jumps out: "Decisions to move money from one TIF district to another contiguous district--so called 'porting' of funds--are not adequately documented and are made without sufficient transparency to assure adequate accountability and public scrutiny."

The porting of TIF funds between contiguous districts is what changes TIFs from a tool for development into a de facto shadow budget. The justification for porting is meager, and the impact is enormous: a look at the city's TIF districts shows that contiguity is common. Since TIFs are meant to eliminate concentrated blight (with a creation process take that targeting as an assumption), porting money from one district to another defeats the purpose of the program.

View Larger Map
Map via Windy Citizen

Continue reading this entry »

Ramsin Canon

Media Wed Jun 16 2010

What Mick and Ben Said

Ben Joravsky and Mick Dumke, the Readers' star political reporters, had an important piece in the Reader a couple weeks back analyzing the TIF budgets and how exactly the money is dispersed. Much of what they found reinforced the suspicion that a lopsided amount of TIF dollars go to pet projects in non-needy neighborhoods, thus flouting the purpose of the state TIF statute. Interestingly, some of what they found actually overturned some conventional criticisms of TIFs, for example that it was weighted towards the clout-heavy (as an example, Finance Committee Chair and light tenor Ed Burke's 14th Ward received comparatively little from TIF funds).

Here's one important thing about their piece: it revealed no scandal.

In the larger sense of good versus bad government and policy, it certainly could spark outrage. But in the traditional sense of public corruption or betrayal of public trust or even rank hypocrisy, the Reader piece didn't serve the narrative of corrupt politicians swindling the public. Instead, it very methodically made a case that the current policy regime was ill-serving constituents, and did it in a sober (though entertaining) way. Yet even with that sober tone, it was enough to get people's cackles up.

That is the type of reporting that is threatened by the collapse of journalism. Yet, at the same time, the dailies aren't really known for this type of research and journalism--the type that doesn't look for a scandal as a hook, but rather just tries to tell the story of how the city works fundamentally, and make a case for fundamental change. That's not advocacy, that's just stripping the system down, rather than dressing politicians down. It's an important distinction.

At the beginning of the year I wrote a piece, Getting Past Daley, that tried to make the case that focusing on political personalities is beside the point, that the corruption that causes such outrage when it's reported in the Trib or Sun-Times is a result of material conditions and powerful institutions, not the whims of quasi-criminal elites. When we began organizing against the Olympics, we were disheartened by how much people wanted to focus on the Mayor as the problem, when the problem is clearly deeper than him.

Joravsky and Dumke in their analysis of the TIF program actually bust some myths about how the TIF money is spent--it isn't going to the clouted necessarily, it is money luring money, not petty local political clout dominating the process. By breaking down the mechanics of the process, Joravsky and Dumke create outrage out of picayune politics, not sensationalized scandal:


About a quarter of all TIF spending, or $358 million, went to a single ward, the Second, which includes much of the Loop and gentrified areas on the near south and west sides. That's more than the bottom 35 wards got altogether.

Approximately $267 million more was spent in the 27th and 42nd wards, which include the Gold Coast and near west and near north sides. Together the three downtown wards received about 43 cents of every TIF dollar spent between 2004 and 2008.

Portions of the Second, 27th, and 42nd wards are in fact struggling economically--but those areas are largely missing out too. Some aren't covered by TIF districts; in other places the TIF districts aren't collecting much money. For example, the 27th Ward reaches into parts of Garfield Park where the landscape is dominated by empty factories and vacant lots, but little TIF money has been spent there.

When we get analysis like this--and it's reasonable to disagree with the analysis itself--then we can start to really figure out how to attack the problem, including the politicians we reflexively blame for everything, despite a rotating cast of characters falling into the same pattern over and over, endlessly repeating.

Ramsin Canon

Urban Planning Wed May 19 2010

South Shore Developer Lost Property to Foreclosure

Southworks_Field.jpgThe principal developer of the proposed massive redevelopment at the former U.S. Steel South Works site, McCaffrey Interests, lost one of their featured developments, The Market Common Myrtle Beach, to foreclosure last week.

The project--termed, perhaps ominously, The Market Common SouthShore--will feature nearly 14,000 new residential units, 800,000 square feet of retail and residential construction, and a 1,500 slip marina (finally!). Covering nearly 400 acres of a recently industrial zoned lakefront area, the Market Common SouthShore will rely on a massive $96m TIF subsidy and be developed in several phases over the next 20-45 years. The Market Common Myrtle Beach site also used TIF dollars.

Since 2000, McCaffrey Interests has given $27,100 to local campaign committees, including $3,850 to 10th Ward Alderman John Pope, $7,900 to Finance Committee Chair Ed Burke, $2,550 to 7th Ward Alderman Sandi Jackson, and $5,000 to Mayor Daley. Obviously all four of these local pols would have direct input into the Market Common plan.

The City's Plan Commission granted approval to the first phase of the project on April 21st, and the Community Development Commission gave their blessing on May 11--just a couple of days before the Myrtle Beach foreclosure.

Given its scope and cost, the Market Common could end up changing the South Side Lakefront completely. We'll be looking a little more closely at the plans over the coming weeks. A spreadsheet of McCaffrey's political giving is below the fold.

Continue reading this entry »

Ramsin Canon

TIFs Wed May 12 2010

Midwest TIF Gets a $32 Million Raise

This Op-Ed was contributed by Valerie F. Leonard, a community development consultant on the city's West Side.

The City Council approved an ordinance on April 14, 2010 to increase the redevelopment budget for the Midwest TIF district from $100,500,000 to $132,865,000. This represents a 32% increase from the district's original budget. The City of Chicago's Projected TIF Balances Report 2009-2011 indicates that the Midwest TIF is projected to have a cash deficit of -$6,842,003 at the end of 2010 if every project on the schedule is implememented, and projected 2010 incremental tax revenues of $13,000,000 materialize. The projected deficit is expected to grow to -$7,213,492 by the end of 2011.

Midwest TIF Graphic-Redevelopment Budget.jpg

Midwest TIF Boundaries.jpg

Continue reading this entry »


TIFs Mon Dec 28 2009

Spending Secret Money in the South Loop

Chicago Journal editor Micah Maidenburg digs into a $59m South Loop TIF to find out just how the money there will be spent. One of the first, I imagine, of many such stories as the public turns their attention to the administration's "shadow budget".

Even as the Calumet-Cermak district faces its demise, the city is negotiating with an unnamed private entity for a future potential TIF-supported project in the Calumet and Cermak area.

The existence of that project was made public on a list the Chicago Reader obtained through the Freedom of Information Act and recently published online. The list, which the city has now posted to its Web site, shows various projects that tax increment financing dollars will fund or potentially fund through 2011.

Ramsin Canon

Aldermen Tue Dec 15 2009

Tough TIF Questions Asked on Dearborn Street

Braving the cold, more than 200 members and supporters of the Sweet Home Chicago Coalition gathered outside of Alderman Robert Fioretti's office (2nd Ward) at 429 S. Dearborn St. Tuesday morning, sometimes shivering from the bitter temperature but united in their chant:

"What do we want? Affordable housing!"

Members of the Coalition, which unites three unions and nine community organizations, marched outside of Firoetti's office, urging the alderman to support an ordinance that requires 20 percent of future money generated from tax increment financing districts (TIFs) go toward affordable housing. In a TIF district, property taxes are frozen, freeing up money that would normally go to schools or parks in order to spur development in "blighted" areas. But the city's management of these funds has come under scrutiny lately, thanks to the tireless work of Ben Joravsky and Mick Dumke of the Chicago Reader, the Block 37 fiasco and thoughtful tracking from Progress Illinois.

According to the Coalition, Firoetti has supported TIF subsidies for wealthy corporations but has yet to support TIF funding for affordable housing. The Coalition released a report today (.pdf) showing that $91.8 million in city funds designated for these "blighted" areas instead has gone toward offices for companies that average billions of dollars in profits. According to the report, Firoetti has supported six of the ten projects the Coalition reviewed. In addition, members of the Coalition argue that if the $91.8 million instead went toward affordable housing, 2,944 residents could have received accommodation.

While the 20 percent won't fix all of the city's affordable housing woes, Julie Dworkin, director of policy for the Chicago Coalition for the Homeless, argues that it's a strong step toward creating more permanent affordable housing. "We decided that would be an adequate amount to spend on housing," she says. "We thought it was realistic. We're not asking for all of the money. We're asking for something that we think would make a significant impact."

Dworkin acknowledges that the ordinance is "not the whole solution," but it's the best thing the city can do now. "We're in this terrible recession," she says. "There isn't extra money lying around, except in these TIF pots. We know it's there...It's urgent right now in the recession because the need for housing is so much greater. We have this foreclosure crisis, we have unemployment rising, the numbers from Chicago Public Schools shows with homeless children, there's 25 percent more this fall than last fall, so this is the time when the need is really great...In Chicago, we've been dismantling public housing, so we have lost thousands and thousands of units through the demolition of public housing. We've been building some more, but we have not nearly made up for what's been lost."

Continue reading this entry »

Sheila Burt / Comments (2)

TIFs Wed Nov 04 2009

How We Can Use TIF Funds

As the issue of tax increment financing (TIF) districts and the non-appropriated "shadow budget" they generate moves into mainstream media coverage, it's important to remember a couple two tree things about TIF funds, the main one being that the money in TIF accounts is not interchangeable with the money that is missing (the deficit) in the city budget.

First, TIFs are ultimately regulated by state statute. [PDF]

Second, TIF funds are property tax funds, and they can't just be spent however. The state statute limits what the money can be spent on. So although the Mayor controls some $1 billion in TIF funds, that money can't just be spent the same as the corporation funds the City spends on most of its budget; by state law it has to be spent inside the TIF district (or an adjacent district) and on statute-defined things.

Third, and related to that, is that the money in TIF funds is not the city's money per se. So if the TIF districts had not existed, the subsequent money raised would not be "freed up" for the city to use; it would return to the following taxing bodies (via the now-defunct NCBG):


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Ramsin Canon / Comments (9)

TIFs Tue Oct 20 2009

As Block 37 struggles, what happens to TIF cash?

After a series of fits and starts throughout the past four decades, today's news wasn't entirely unexpected: Block 37--a planned commercial center in the Loop--is facing foreclosure.

Block 37 developer Joseph Freed and Associates LLC isn't only over-budget by $34 million, but owes $128.5 million on a $205 million loan that's overdue.

While this may signal all sorts of unsavory prospects for the commercial real estate market, it also raises the question of what now happens to the enormous amounts of taxpayer money invested in the project through the Central Loop TIF district.

Continue reading this entry »

Richard Lorenc / Comments (3)

TIFs Tue Oct 20 2009

PI on TIF Welfare

Josh Kalven of Progress Illinois digs into the business-luring TIF deal--a program the Mayor once referred to as the only game in town for economic development--and points out just one of the many problems with it: it puts the public on the hook without making any real demands on the corporations who receive our largess. It's harder to reduce your student loan payments than it is to get tens of millions of dollars of public money.

Indeed, when the ink dries on the each of these deals, the debate in the press inevitably surrounds the cost-per-job estimates and the various long-term revenue projections stemming from the agreement. But what's missing is any method for examining the previous contracts. No one digs into the earlier relocations to see whether they fulfilled expectations and were ultimately worth the public investment. Instead, we're greeted with a perpetual refrain: "Trust us." "We know what we're doing." "Trust us."

Ramsin Canon

Column Wed Aug 12 2009

FOIA, TIFs, and Disarmament by Transparency

Government transparency: realm of nerds? Or power politics?

America's post-war political tradition has been one of transactional politics. People measure their government less on ideology and more on "results", typically meaning, "what they provide". One of the side effects of this is that advocates for government transparency--who come from all points on the ideological spectrum, in equal degrees of vociferousness--are seen as process-oriented and, well, nerds. Transparency in government, however, isn't just something for good government hobbyists or hard-bitten cynical journalists. "Realists" on transparency argue that the desire to know everything the government does ignores the reality that in order to get things done, Serious People need to negotiate behind closed doors (Cf., privatizing parking meters; Chicago's stimulus list). Transparency--the state erring on the side of openness and making all of its institutional processes immediately available for public inspection--doesn't necessarily need to make government operations impossible. Quite the contrary, actually; foreknowledge of public scrutiny could act as a form of disarmament. Over time, the presumption of openness could disarm cynics and foster a mode of interaction between the state and private actors that eliminates the competitive pressure to hide things from the public.

Or, instead of using ridiculous jargon like I did in that last sentence, I can use a series of cliches; if Information is Power, then true and full transparency is an immediate way to give Power to the People.

Recently, two major government transparency issues have come (close to) the public eye: an amendment to the state Freedom of Information Act (FOIA) and the City of Chicago's new TIF transparency website. A look at these two issues below.

Continue reading this entry »

Ramsin Canon

TIFs Tue Jul 21 2009

Fix Wilson Yards Group Ready for New Suit

Chitown Daily News is reporting that the Fix Wilson Yard community group, which organized itself around resistance to the massive development that has been in the works and under construction for years now, is ready to file another lawsuit against the city and the developer:

Judge Mary Rochford on Friday granted a request by residents group Fix Wilson Yard to file a new lawsuit against the City of Chicago and Holsten Real Estate, the developer of the project that will feature a Target store, office space and housing for low-income families and seniors.

"We're trying to accomplish the same thing we've been trying to accomplish since the beginning, which is to stop the wasting of taxpayer dollars," says Thomas Ramsdell, Fix Wilson Yard's attorney. "My clients are as motivated as ever."

Ramsdell said Fix Wilson Yard will file the lawsuit next Friday.

The original lawsuit filed by Fix Wilson Yard in December 2008 accused the city of wrongfully establishing a tax increment financing district to fund the project. 

TIFs allow taxpayer dollars to be used to develop blighted areas. The group also accused the city of violating the state Open Meetings Act, among other allegations.

Ramsin Canon

TIFs Thu Mar 26 2009

Should Chicagoans Stop Throwing Money into a Giant Hole?

A few weeks ago The Onion--America's finest (fake) news source--boldly asked the question: Should the government stop dumping money into a giant hole?

"It's just like they say," said commentator Duncan Birch, "you have to throw money in a hole and set it on fire to make money."

Of course, the piece was a parody of the dramatic increase in government spending in the form of bailouts, stimulus and whatnot, but there are real-life money holes here in Chicago.

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Richard Lorenc / Comments (13)

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Parents Still Steaming, but About More Than Just Boilers

By Phil Huckelberry / 2 Comments

It's now been 11 days since the carbon monoxide leak which sent over 80 Prussing Elementary School students and staff to the hospital. While officials from Chicago Public Schools have partially answered some questions, and CPS CEO Forrest Claypool has informed that he will be visiting the school to field more questions on Nov. 16, many parents remain irate at the CPS response to date. More...


Substance, Not Style, the Source of Rahm's Woes

By Ramsin Canon / 2 Comments

It's not surprising that some of Mayor Emanuel's sympathizers and supporters are confusing people's substantive disputes with the mayor as the effect of poor marketing on his part. It's exactly this insular worldview that has gotten the mayor in hot... More...

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