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Tax Increment Finance 101
 

Tax Increment Finance 101

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Tom Tresser explains the basics of TIFs - Tax increment Finance. A service of TresserLabs - building tools for innovation and civic engagement @ http://www.tresser.com.

Tom Tresser explains the basics of TIFs - Tax increment Finance. A service of TresserLabs - building tools for innovation and civic engagement @ http://www.tresser.com.

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    Tax Increment Finance 101 Tax Increment Finance 101 Presentation Transcript

    • “ TIF 101 How They Work & Why They Need to Go” Tom Tresser – [email_address] – http://www.tresser.com
    • 420 TIFs created since 1979 TIFs – THERE ARE A LOT OF THEM!
    •  
    • 23 year life
    • “A billion here, a billion there…and it starts to add up to real money.” TIFs ARE HUGE
    • 2008 TOTAL FOR ALL COOK COUNTY = $875 MILLION! TIFs ARE HUGE
    • TIFs Are Corrupt
      • Controlled by mayor & city councils
      • Each one requires consultant to plan
      • Each one has audit requiring law firm, accountants
      • Reporting, monitoring, evaluating almost impossible
      • Massive abuse, fraud, insider deals
    •  
    • TIF for North Side auto dealer is a boondoggle. (Opinion)(city officials plans to give Grossinger Auto Group $8.5 million in tax-increment financing ) Crain's Chicago Business – Jan 14, 2008 TIF addiction in Chicago reached a new low last week. City officials endorsed a plan to give Grossinger Auto Group $8.5 million in tax-increment financing to build a dealership at the bustling intersection of North and Clybourn avenues on the North Side. The site isn't in a TIF district, but the officials were kind enough to create one just for the building Grossinger plans to convert into a four-level auto mall.
    •  
    • 2009 revenues of $2.6 BILLION! IN 2009 THE CITY GAVE CHICAGO MERCHANTILE EXCHANGE $15 MILLION FOR REHABBING CORPORATE HQ. APPROVED BY ALDERMAN BOB FIORETTI, 2 ND WARD.
    • CHICAGO PLEADS POVERTY… CUTS SERVICES. CLOSES SCHOOLS. CLOSES HEALTH CLINICS. LAYS OFF TEACHERS. City closed for three week days in 2009… and yet...
    • THE CITY HAD $1.4 BILLION IN UNSPENT TIF FUNDS AT THE END OF 2008 AND NEARLY AS MUCH AT THE END OF 2009!
    • IF THERE WERE NO TIFS, WHAT HAPPENS?
    • NO TIFS = YOUR PROPERTY TAX BILL GOES DOWN BY 11% !!
    • But We NEED TIFs…
      • We can use other methods to subsidize WORTHY, appropriate projects
      • Bonding
      • Place line items in city budget
      • Timely, public review process to solicit and build support for projects that CAN NOT be done by the free market
    • In Closing…
      • TIFs are a tax
      • They impact everyone
      • They are corrupt, difficult to monitor
      • Eliminating TIFs = PROPERTY TAX BILLS GO DOWN BY 11%
      • There are other ways to fund worthy projects