Sunday, March 20, 2011

Daley's TIF Slush Funds Drawing Protests In Chicago

Perhaps this is what needs to happen in Indianapolis to stop the insanity of diverting all of downtown's tax  revenues into TIF funds that are nothing more than slush funds the Mayor can tap to pass out to big campaign contributors for their private business development efforts. Protesters took to the streets in Chicago to protest $2 billion skimmed by TIF districts that are short-changing other taxing districts so Mayor Richard Daley can pass out the money to businesses like Grossinger City Autoplex that received $8.5 million in TIF funds for its northside auto dealership. The Sun-Times reports:

About 150 teachers, parents and activists marched into the Grossinger City Autoplex and demanded a check for $4 million Saturday.

That would be the “TIF” money — protestors called it “The Mayor’s Slush Fund” — diverted from the public schools and given to developers such as those who built the autoplex.

The incensed auto-dealers had two protest organizers arrested for trespassing.

“They came in and disrupted my business,” said Grossinger General Manager Brian Wenberg. “I understand they have the right to protest but not in the middle of my showroom. They can do it outside. They’re talking about the TIF money — none of my employees know anything about it.”

The Tax Increment Financing or TIF districts have operated below the radar screens for decades until the current financial crisis forced cutbacks in government spending that would not have to be as severe if the TIF funds did not divert money away from schools, libraries and other taxing bodies, critics say.

In a TIF district, the property taxes sent to the city and other taxing bodies are frozen for 20 years. Any revenue collected above that first-year level is put into a special fund to be used to encourage economic development in that district. That can include road repairs, street lights and other infrastructure improvements.

The largest single taxing district in Chicago is the public schools, which would be in line for 50 percent of the $500 million in property tax dollars diverted into TIFs every year.

“There’s a giant myth being spread all across this land ... that local governments have no money, they need to take it out of the backs of teachers, take away their pensions,” Cook County Clerk David Orr told the cheering protestors. “Chicago ain’t broke. Chicago has put $2 billion tax dollars that the public doesn’t know about into these TIFs and there’s another $500 million being added every year. There needs to be a moratorium on these TIFs because there has been enormous abuse. They are supposed to go to blighted areas. It’s gone to Willis Towers. It’s gone to Grossinger. It’s gone to other major corporations. As we uncover the mayor’s slush fund, which this is, we’re going to discover that money can go to help the schools.” . . .
The protestors rallied outside Jenner School on the Near North Side, then marched to a Bank of America Office that got TIF money, then to Grossinger, which got $8.5 million in TIF money.

The protestors said they were “peaceful.” Weinberg said some protestors used abusive language toward his staff . . .
The Daley administration's reaction to the protesters complaining that the schools are losing out to these revenues is classic:

The Daley administration argues that the public schools’ tax levy remains the same so money is not really diverted from education — the schools just reach deeper into homeowners’ pockets than they would without the TIFs.
The problem we have in Indianapolis is that the local news media is on the scam. They fully embrace the downtown Ponzi scheme whereby virtually all of the downtown property tax revenues are skimmed by TIF districts that continue to fund new projects promoted by the campaign contributors of the Mayor within the Mile Square to the detriment of the rest of the City and its taxing districts. They won't even discuss it. Instead, we're treated to one story after another of the success of Indianapolis' downtown while the rest of the City is going to hell as people flee to the safety and comfort of the surrounding counties. Nobody wants to live in these crime-infested neighborhoods or send their children to public schools that fail to educate their children. As long as we have sports palaces, ritzy hotels and fine dining experiences for our out-of-town visitors, that's all these so-called civic leaders care about.


Concerned Taxpayer said...

Our democrats love our Mayor Daley's operation of the slush funds, so there will be no changes.

Pete Boggs said...

Tif free communities could advertise as such and attract residents, productive people who don't need government to get up in the morning.