The Tax Increment Financing district for Lincoln Square has transferred $4,409,652 to other TIF districts in the last two years, according to city reports issued this year. A proposed city budget will siphon another $3,205,798 in fiscal 2011 from the TIF.
The $7.615 million is being used to fund the Clark Streetscape and to pay debt service on the Modern Schools Across Chicago bonds, records indicate.
The Western Avenue TIF transfer at 66.99 percent of revenues, is the largest in term of portion in the city and ranks third in the city, trailing just the huge city center TIFs on the West and South Sides, in terms of dollar value.
The Bulldog also determined that based just on the last two years of the ten-year old TIF, 19.27 percent of its total funds have been transferred out. Because figures for transfers were not available when the story was written, the total transfer over the eight years from 2000 – 2007 were probably larger.
The transfer, also known as a port, is among the largest transfers among all the city TIFs, representing 10.1 percent of the value of the TIFs transfers in the 2011 city budget.
Lincoln Square Chamber of Commerce officials said they were unable to comment on the transfer due to a struggle with the city to retain funding for their offices, valued at $67,798. “In general we want those TIF funds to stay in our area,” Melissa Flynn, executive director of the chamber told The Bulldog.
In a TIF, the district is first certified as being blighted. Following that “the value of the property in the area is established as the “base” amount. The property taxes paid on this base amount continue to go to the various taxing bodies as they always had, with the amount of this revenue declining only if the base declines (something that the TIF is expected to keep from happening) or the tax rate goes down,” according to the Illinois Tax Increment Association.
The Western Ave TIF, established in 1999, will continue through 2023. In its 11 years it has collected $22,888,268 in increment funds according to city reports. That $22.89 million since 2000 represents money diverted by the TIF from the city general fund ($654 million in deficit in 2011), the public schools ($475 million in deficit in 2011 ), Cook County government and other public agencies and is just one of 161 TIFs in Chicago.
Critics such as Ben Joravsky of the Chicago Reader say the $22.89 million also represents a tax increase as Chicago TIFs now account for $595,590,381 of local tax revenues in 2008 according to the Cook County Clerk’s office. If the TIF revenues were used to fund schools, critics such as Joravsky say, the deficits of the schools and the city would be much smaller.
IL Rep John Fritchey (D-DePaul West) submitted a bill to the legislature that would require TIFs with surplus funds to return them to the general funds of the local taxing bodies at the end of each year. Fritchey told The Bulldog in an August interview that about $1 billion is available to be declared as surplus, though that estimate has since shrunk to about $700 million.
The budget presented by Mayor Richard Daley is declaring about $200 million in surplus TIF funds, according to media reports.
The Western Avenue North TIF has $11,743,235 in surplus funds, according to a 2009 study by Robert Ginsburg, PhD and Don Wiener, PhD on behalf of the Service Employees International Union.
The TIF has pledged $15,385,283 to the 4800 Damen LLC redevelopment, according to the TIF annual report. Another $2,000,000 has been earmarked for Small Business Improvement Funds the documents show. The TIF ran into opposition previously when it was being used in an eminent domain battle in Lincoln Square.
The Bulldog asked Aldermen Eugene Schulter, Dick Mell and Pat O’Connor to comment. Follow-up e-mails were sent to the three aldermen.
Schulter’s (D-North Center) office indicated on Saturday they were working on a response. None has been received yet.
O’Connor’s (D-Budlong Woods) office suggested The Bulldog do a FOIA to learn the alderman’s opinion. The Bulldog noted back to O’Connor’s office that a FOIA would not learn the alderman’s opinion.
Mell’s (D-Irving Park) office did not respond in any way.
The Western Ave TIF is located entirely inside the 47th and 40th Wards. The questions put to the aldermen by The Bulldog included general questions about TIF use.
On Monday Mayoral hopeful Rahm Emanuel received a list of questions from The Bulldog. His campaign has not yet responded.
Of the eight people contacted by The Bulldog only 47th Ward Challenger Ameya Pawar (I-North Center) answered.