Mayor declares $300M TIF surplus — largest in Chicago history
Mayor Lori Lightfoot’s 2020 budget includes a $300 million tax increment financing surplus — the largest in Chicago history — just to help bankroll the $500 million offer the striking Chicago Teachers Union has already rejected.
By closing out five TIFs and scouring all of the others, Lightfoot has managed to generate $163 million for Chicago Public Schools. That’s $66 million more than the school system received last year.
The city will get $31 million of that money to help defray its $838 million budget gap.
TIFs allow the city to generate money for economic development in a specific geographic area. That’s done by reinvesting all new property tax dollars in the neighborhood from which they came for two decades or so.
But often the money sits unused, and Lightfoot is tapping it to help with the financial challenges both CPS and City Hall are facing.
A top mayoral aide acknowledged the TIF surplus is the largest in Chicago history. It’s $125 million more than last year.
But the aide stressed the windfall for CPS is enough to cover only the five-year, $500 million mayoral offer that CTU already has rejected. That offer includes a 16% pay raise over five years and increases in school support staff.
“This is, in essence, scraping the mayonnaise jar. We went through and aggressively surplused every single TIF . . . . The [extra] $66 [million] covers the offer that’s currently on the table,” the mayoral aide said.
The administration effectively took out all the extra money that wasn’t committed for various projects.
“We scrutinized every project — took a look at what the tax forecasting would be based on projections for what property tax values would be in each of the TIFs. And we’ve more aggressively surplused in order to be able to get more bodies back to the taxing bodies, in particular CPS because . . . they are facing increased costs as related to this contract.”
Former Mayor Rahm Emanuel endured a seven-day teachers strike in 2012 and used an $87.5 million TIF surplus to stave off a second teachers strike. His own City Council floor leader acknowledged the surplus was onetime revenue that could not be sustained.
On Wednesday, the Lightfoot aide acknowledged the same thing. “You make a good point. This surplus is one-time revenue. And importantly for CPS, they’re gonna need to find additional revenues going forward,” the mayoral aide said.