Bringing greater fairness to who gets TIF money in Chicago

If you need proof of how well tax increment financing can serve Chicago, check out virtually any movie filmed here before 1995. You’ll see a faded and aged city with decayed streets and ragged sections downtown. And it would have grown only worse. The increase use of TIF in the 1990s revived the Loop and sparked redevelopment across the city.

Having watched a lot of those movies, we’re inclined to offer at least our tentative support for Mayor Lori Lightfoot’s plans to reform — but by no means end — the city’s TIF program.

The city’s 138 TIF districts churned out $841 million in tax revenue in 2018. And that was a $181 million bump up from 2017.

That’s a big pot of money. Lightfoot wants to continue the program while making it fairer and less oblique, distributing its funds more equitably. We couldn’t agree more.

Changes to TIF

Under Lightfoot’s plan, the city’s TIF Investment Committee and the city’s chief equity officer, Candace Moore, are to work together to make equity — basically a better deal for truly distressed neighborhoods — a stronger focus of the TIF program. Deputy Mayor Samir Mayekar, who chairs the committee, told the Chicago Sun-Times the group will ask “pretty tough questions” to make sure proposed TIF-funded projects spur economic development across a whole stretch of the city, rather than result in just an isolated new structure that leads to nothing larger.

“TIF can play a very important role in catalyzing economic development. The key is that it’s transparent and that there’s a high degree of accountability around how the money is spent,” Mayekar said. “That is what the mayor is doing here with these sweeping reforms.”

We also like that Lightfoot promises to take a harder look at the “but for” factor before granting TIF funds. But for the TIF funds, that is to say, would the project get off the ground? That kind of skeptical vetting could go a long way toward allaying public perceptions that City Hall just doles out TIF money to any fat-cat developer who comes along.

Lightfoot’s new plan for the use of TIF funds is a far cry from where she appeared to be last April when, as mayor-elect, she took a stand against ramrodding through the City Council two huge TIF-laden developments — Lincoln Yards, and The 78 — only to change her mind hours later.

The Council awarded $900 million to Lincoln Yards and $700 million to The 78. We supported both projects, and we still do, but not the hurried way in which the TIF provisions were reviewed. A matter so large, striking to the heart of economic fairness in Chicago, we wrote, should not decided in “a flurry of phone calls and closed-door bargaining over just 48 hours.”

An equitable TIF program is good for Chicago

Lightfoot now wants to throw a lot more sunlight on the process. She intends to release monthly TIF spending reports, with reviews of the progress in each TIF district. She wants the city to draft comprehensive neighborhood plans before granting TIF funds.

None of this goes far enough for some critics.

The Chicago Teachers Union and the organization Grassroots Collaborative — two groups that also strongly criticized former Mayor Rahm Emanuel for his handling of the TIF program — want Lightfoot to reduce TIF funding for downtown projects.

“Those dollars shouldn’t be spent for economic development downtown,” Grassroots Collaborative Executive Director Amisha Patel said. “That is a violation of TIF statute and the goals and intention of the program. Money should be spend in low-income communities.”

Patel is right about the need for TIF funds to be spent in disinvested areas. Designed to rebuild blighted areas, the TIF program has indeed poured hundreds of millions dollars into projects downtown and on the North Side while redevelopment on the traditionally disinvested South and West sides has languished.

What’s ‘right?’

Lightfoot says she’s every bit as committed as her critics to greater equity in the allocation of TIF funds, and her administration can point to recent TIF projects that move in that direction. A 100% affordable housing project is going up alongside the Logan Square Blue Line stop, and there is the planned renovation of the long-idle Ramova Theater at 35th and Halsted.

It’s a difficult balance, and no mayor has ever been praised for getting it right. Because there is no one objective definition of “right.”

But when in doubt, an every greater emphasis on economic equity — lifting up old neighborhoods before investing in another North Side playground or downtown skyscraper — is the only way to go.