Sunday, November 29, 2009

Experts Have Beef With Daley On TIF

Mayor misstated several programs facts in recent radio interview, critics say

By Abdon M. Pallasch
Sun-Times Political Reporter

Mayor Daley is going on the offense in arguing for his beloved Tax Increment Financing program — but experts say he is being less than truthful about what critics dub a “shadow budget.”

Daley has held news conferences and conducted radio interviews about “TIF”s in recent weeks. But in just 2 1/2 minutes during one radio interview, experts say Mayor Daley told a number of falsehoods about the controversial economic development tool. Continue Reading


  1. Da Mare telling an untruth?

    I'm shocked.

    I'm mortified.

    Who knew?

    Next he'll tell us he didn't know his nephew had city contracts or that his son was involved in one contract also. Oops, too late.

  2. PALLASCH touches on all the right buttons but still gets a bit of it wrong. He writes: “In a truly blighted area, school and park districts suffer no loss because any additional tax revenues being raised in the 20-plus-year lifetime of the TIF might not have happened but for the improvements there.”

    School and park districts? I didn’t think we had more than one of each in the City of Chicago. Funding for CPS and the Park District are not extracted discretely from individual TIF districts or, thankfully, Aldermanic Wards so when increases in the EAV are diverted---whether those increases accrued in Old Town or Humboldt Park---all schools and parks actualize a loss because those funds are not available for general appropriations.

    As for distinguishing between natural and stimulated increases in the EAV, that puts the infamous "but for" test in the hot seat. It's a standard that comically requires not a projection or even best guess but an assertion of fact about a future state with close to no information. Yes, forward modeling is possible but for the conclusions to be meaningful (i.e. credit worthy), the criteria must be standardized and it's not.

    As for “truly blighted,” well, we may know it when we see it but the statute does not provide a robust or meaningful definition and it's never been the impetus for the creation of a TIF district in the City of Chicago. At least not as far as I can tell.

  3. What a sad city this has become. One can only hope that Fitz has secretly been building a case against this crook before he retires and chooses not to run for re-election in 2011.

    Lets just hope he takes the alder-lemmings that have their hand in the cookie jar with him.

  4. "The article described that as a “divide-and-conquer” strategy that allows the administration to silence opposition to TIF proliferation lest aldermen see projects destined for their wards dry up."

    Yep FWY and all who supported it were indeed silenced! The hearing on the TIF expansion at City Hall was a prime example!

  5. Not to nit-pick Suzanne...but I don't see your point. Tha author noted two districts, school and park, that's plural. Actually, there are even a few more I believe. The statement you quoted was a very conditional one which illustrates, to my mind, the theorectical versus practical when discussing TIFs.

  6. I was being a little cheeky, Bradley and meant only to point out that the movement of the money (into TIFs and away from CPS and the Park District, for example) and the effects of such are not as tidy or discrete as that one particular sentence might lead one to believe. Or as benign.

    As for the theory of TIFs, it's not as though that gets us any closer to some ideal. The whole TIF scheme is predicated on a rather sketchy and, I believe, undemocratic idea: It's akin to saying we're going to set aside some number of tax dollars, exclude them from the appropriations process and suspend normal accounting requirements ---financial and political.

    Is it easier to target and fund development projects in this way? Oh heck yes. The Alderman get to decide rather than the full Council. But over time, it becomes a problem of the commons and taken to its natural end it will leave us not with wise and good leaders and a healthy city but a public goods wasteland.

  7. Suzanne,

    Per usual, I found your posts informative and insightful, but recent Reader articles lead me to dispute your assertion that "The Aldermen get to decide rather than the full Council".

    The TIF budgets indeed elude Council scrutiny, but a more accurate description would be "some Aldermen get to decide...".

    According to Ben Joravsky and Mick Dumke, most TIF expenditures are controlled by Daley and his finance team, and they usually don't ask Aldermen how to allocate the money. If anything, they tell them. Also remember that many TIFs span wards.

    The WY TIF appears to be an exception to this rule.

  8. You're right, Eric, that is a more accurate statement. Funny though how a few Alderman always seem to have their Christmas stockings stuffed. ;-)) The central problem remains: Instead of open debate about how resources are allocated, the discussion--and the documentation--is limited to a select few insiders.

  9. You're also right, Suzanne. The central problem does remain. Of course, we all know his name.