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The TIFs of Hermosa

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The TIF Illumination Project (www.tifreports.com) made its 48th TIF Illumination for the Hermosa Neighborhood Association at Kelvyn Park on May 6, 2017. The presenter was Tom Tresser with research assistance from Eric Unger. info@civiclab.us

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The TIFs of Hermosa

  1. 1. May 6, 2017 Tom Tresser with research from Eric Unger
  2. 2. 2 The TIF Illumination Project started in 2013.
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  5. 5. 5 Key Policy Questions 1. Under what circumstances do we give public $ to private business? 2. Who plans what for whom? AKA, What defines “community development”? 3. Is Chicago broke? 4. Who’s watching our back? Need for new leaders.
  6. 6. 6 What are TIFs?
  7. 7. 7 What are TIFs? • Created by municipality (state law) • Designed to subsidize some business project in “blighted” or under-served area • “But for” test – only for projects market CAN NOT support • Captures “incremental” property taxes ABOVE base when district was created • Only for hard costs • Lasts 23 years • Supposed to be spent where collected
  8. 8. 8 What are TIFs? The Midwest TIF – 24th Ward (created in 2000) Say there are 1,000 properties in the TIF…
  9. 9. 9 How Do TIFs Work? When the TIF is created, the city tallies up all the property taxes generated by district in that year (called the "base" amount). After that, all property tax increases above the base (the "increment") are channeled to the TIF district. The property taxes collected from properties inside the district BEFORE the district was created that go to units of government stays FLAT for the life of the TIF (23 years).
  10. 10. 10 Money From TIFs Taken From?
  11. 11. 11 What are TIFs? Under state law, areas proposed for TIF designation must possess numerous blighting factors to be eligible: • Age • Obsolescence • Code violations • Excessive vacancies • Overcrowding of facilities
  12. 12. 12 TIFs Usedto support commercial projects in these“Blighted” Areas 40 S. Halsted Apple Store
  13. 13. 13Better Government Association
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  18. 18. 18 Where are TIFs? 2015 Chicago = 146 Suburbs = 293 Cook County = 439
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  20. 20. 20 Mr. TIF
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  22. 22. To sum up:  TIFs = property taxes  Increment $ collected by TIF  Run by city (mayor)  Lasts 23 years  Blight & “But for” conditions  Hard costs  Supposed to be spent where collected
  23. 23. 24 TIFs of the Hermosa Neighborhood
  24. 24. 25 Name of TIF TIF # Created Expires % in Community In Community Armitage/Pulaski 151 2007 2031 100% Pulaski Industrial 069 1999 2023 50% NW Industrial 064 1998 2022 25% Adjacent Belmont/Cicero 082 2000 2024 Galewood/Armitage 071 1999 2023 Belmont/Central 081 2000 2024 Portage Park 058 1998 2021 Near Avondale 167 2009 2033 Fullerton/Milwaukee 087 2000 2024 Kennedy/Kimball 160 2008 2032 North/Cicero 035 1997 2020 TIFs of the Hermosa Neighborhood
  25. 25. 26 Armitage/Pulaski Fullerton/Milwaukee Fullerton/Milwaukee Belmont/Cicero Pulaski Industrial Avondale Portage Park Fullerton/Milwaukee Northwest Industrial Belmont/Central Galewood/Armitage Kennedy/KImball North/Cicero
  26. 26. 27 Hermosa Area TIF Totals for 2015 Est. property tax extraction from 3 TIFs in community = $2,472,050 Est. property taxes left in accounts end 2015 from these in community TIFs = $10,189,973 Est. lifetime extraction for TIFs 100% and partially in ward = $38,670,305
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  28. 28. 29 Hermosa Area TIF Totals for 2015 Property tax extraction from TIFs IN and NEAR community = $25,125,835 Property taxes left in accounts end 2015 from these TIFs = $103,033,995 Total expenses from these TIFs = $18,693,179
  29. 29. 31 Hermosa Area Major TIF Funded Projects $6,532,793 = public projects (8.6%) $13,606,185 = nonprofit projects (17.9%) $55,815,178 = private projects (73.5%) [Largest = Brickyard Mall - $26,500,000] [Monclare Senior Residence - $12,050,700] [Florsheim retail & condos - $8,500,000] [Hairpin lofts & retail - $7,151,770] 2 Home Depots - $5,775,915]
  30. 30. TIF $ in Chicago’s Loop 24
  31. 31. 123 S. Dearborn Street – Dearborn Center 32 W. Randolph Street – Oriental Theater 1 N. Dearborn Street - Sears TIF $ in the Loop
  32. 32. 188 W. Randolph Street – Randolph Tower Apartments 230 N. Michigan Avenue – Hard Rock Hotel 555 W. Monroe Street – PepsiCo TIF $ in the Loop, Near West Side
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  34. 34. 38 TIFs hoard taxes in prosperous communities – starve poor communities. 1. They further inequality in chicago.
  35. 35. 39 Authors plead "Our message is simple: 'Please, please, if you're going to offer incentives, don't give them to every firm that asks -- Don't! Ninety percent of the time they don't work, and handing them out after a company has already located in an area without them makes no sense at all."
  36. 36. 40 www.tifreports.com www.wearenotbroke.org tom@civiclab.us 312-804-3230

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