Chicago's Community Development Commission advanced a controversial plan to the city council last Tuesday that would create a new tax increment financing district in the economically struggling Washington Park neighborhood on the South Side, despite opposition from some local residents. Progress Illinois takes a closer look at the issue.
Chicago's Community Development Commission (CDC) advanced a controversial plan to the city council last Tuesday that would create a new tax increment financing (TIF) district in the economically struggling Washington Park neighborhood on the South Side, despite opposition from some local residents.
Backers of the proposed Washington Park TIF District claim it is needed to help revitalize the community, but opponents are concerned it could ultimately push residents out of the neighborhood. Others against the taxing district, including Tom Tresser, co-founder of the Chicago-based CivicLab and leader of its TIF Illumination Project, question the overall effectiveness of the city's contentious TIF program, which was originally intended to spur economic development in blighted areas.
"We've seen rifle-shot projects that benefit a relatively small amount of people," Tresser said of Chicago's TIF program. "We've seen no evidence of massive job creation or any such thing. The academic literature says TIFs have nothing to do with economic development in any way ... We've seen friends of the mayor, friends of the aldermen get lots of money."
If approved by the full city council, the new Washington Park TIF District would be generally bounded by Martin Luther King Jr. Drive on the east, the Dan Ryan Expressway on the west, Garfield Boulevard on the north and the Chicago Skyway on the south. The proposed district, which includes a swath of industrial land, also encompasses the 351-acre Washington Park, according to city TIF planning documents prepared in part by Ernest R. Sawyer Enterprises Inc., a company headed up by Ald. Roderick Sawyer's (6th) brother.
The TIF report says 31 percent of the nearly 400 acres of land in the proposed redevelopment area, excluding Walter H. Dyett High school and Washington Park, is vacant. And 63 percent of the buildings are deteriorated. The report lists 70 parcels, including 63 that are vacant, within the area's boundaries that could be acquired for redevelopment.
Local Ald. Willie Cochran (20th) did not return Progress Illinois' request for comment for this story.
But last Tuesday, the alderman said, “Our goals are to build single-family homes, to improve and build on those vacant lots, to create a sense of community, to add additional resources so that we can expand our retail base in the Washington Park community,” reported the Chicago Tribune. “Implementing a TIF in the Washington Park community is not bad for anyone.”
Mayoral spokeswoman Elizabeth Langsdorf added, “Not only can TIF funds bring about a revitalization of the transportation corridors and spur investments in new housing in the area, but it will build on these pockets of investment to can create new opportunities for neighborhood residents and businesses to thrive.”
But Cecilia Butler with the Washington Park Residents Advocacy Council, which is against the proposed taxing district, said she is worried other properties, specifically ones that are occupied, could be added to the city's acquisition list down the road. Her biggest concern, however, is that local residents could see their property taxes go up if the TIF district is implemented.
"What pushes out people are taxes," she told Progress Illinois. "They can say all they want about, 'Oh no, taxes don't go up.' Everybody else's taxes that have been TIFed have gone up."
Washington Park residents, she said, "will be giving our taxes to the future that probably won't be the same people that are living here today," if the new TIF district is approved.
The estimated median household income within the TIF district's boundaries was $16,880 as of last year, which is "well below the estimated 2013 median for the city of Chicago of $43,854," the TIF report reads. And more than 97 percent of residents in the proposed TIF area are black, according to 2013 figures cited in the documents.
For those living in a TIF district, which typically has a life cycle of 23 years, a portion of their property tax dollars gets diverted from local units of government and funneled into the TIF district's fund.
In return, TIF subsides are awarded for economic development projects, like a housing facility or retail project, that will supposedly generate future property taxes inside the TIF districts. TIF money is also often used for infrastructure improvements as well as other public-sector and non-profit projects.
According to the city planning documents, an estimated $25 million would be available for eligible project costs over the life of the proposed Washington Park TIF District, with $5 million for public-sector upgrades and $3 million for land acquisition and preparing properties for redevelopment, among other uses.
Another $13.5 million would be used to revamp existing public or private buildings and help cover costs associated with affordable housing construction.
"There's not any named development or developer in the document," Tresser said of the TIF report. "So tell us: who's going to get this money, and what are they going to do with it?"
"I'm very sure that there is a specific developer with plans standing in the wings who will come forward and be given that money," he added.
Butler mentioned the DuSable Museum of African American History and the K.L.E.O. Community Family Life Center, which is planning a mixed-use development, as at least two examples of non-profits that might be able to tap future TIF funds from the proposed district.
"Should TIF dollars be used for institutions" that may be exempt from certain taxes, she asked. "These are (entities) that don't even have to put a penny in the pot."
Additionally, Butler noted that the University of Chicago, located in nearby Hyde Park, has been buying up Washington Park properties. The university has not elaborated on its possible future plans for the area.
"They have already started buying up the community," Butler said of the university. "They have plans, and I'm sure the plans will be in full in the next five years."
Members of the Washington Park Residents Advocacy Council also question some of the blighted properties cited in the TIF report, Tresser said.
"They've visited a number of the properties that are in the TIF document that are listed as blighted or boarded up or in disrepair, and they're not," he said. At Tuesday's CDC meeting, "they were challenging very specific addresses and saying, 'I went to that place. Talked to the owner. He doesn't know why he's being considered as a blighted property."
The Chicago City Council could consider the Washington Park TIF District proposal at September's council meeting. Check back with Progress Illinois as this story develops.