Transit TIF districts

[Busjack]

Tribune article that somehow included in the budget compromise was a provision authorizing 35 year tax increment finance districts in a mile swath  of the RPM. Red Line Extension, and Blue Line, to provide a source of local matching funds for these projects and Union Station if the feds ever fund any of these projects. Article says Emanuel is vague about how this would work, but unlike most TIFs, the schools don't get stiffed.

[Busjack]

Also a link to the legislation (underline is what is new).

[Busjack]

Sun-Times article on how the Union Station part might be used.

[Busjack]

Sun-Times article that (shock, shock!!!) City Council approved the transit TIF. Lots of muddy thinking reflected there. The one new thing is that the TIF is only up to Devon, but since the first phase is to Ardmore, maybe they figure they don't have to do anything north of there until Pres. Lisa Simpson's second term.

[Busjack]

I wonder what really is going on. Tribune article on TIF districts, which says at the end that out of $40 million collected by the transit TIFs, $25 was returned to other government bodies. I thought that money was supposed to secure bonds or matching funds for transit improvements. Other than buying some property around Clark Jct., what transit improvements have happened?

[Tcmetro]

One of the big concerns about TIF in the past was that it captured the entire increment, essentially freezing collections that non-TIF bodies (i.e. city general fund, school dist, park dist, mosquito control dist, water treatment dist, etc) receive. The new Transit TIF allocates the entire share of the base and the increment to CPS, while other governmental bodies receive their entire base value as well as 20% of the increment. This basically reduces the amount of money for transit in comparison to a normal TIF, but allows other units to keep up with development and inflation so as to not be strained by the increased demand for public services.

As for the article, the $15 million generated for transit was likely eaten up by the demolition and acquisition or administrative costs or is just sitting in the account in anticipation of paying the construction costs.

 

[Busjack]

8 minutes ago, Tcmetro said:

One of the big concerns about TIF in the past was that it captured the entire increment, essentially freezing collections that non-TIF bodies (i.e. city general fund, school dist, park dist, mosquito control dist, water treatment dist, etc) receive. The new Transit TIF allocates the entire share of the base and the increment to CPS, while other governmental bodies receive their entire base value as well as 20% of the increment. This basically reduces the amount of money for transit in comparison to a normal TIF, but allows other units to keep up with development and inflation so as to not be strained by the increased demand for public services.

 

On your first part, I'm not aware of the details, and don't know if the $25 million the Tribune says was returned to other bodies includes those increments.

9 minutes ago, Tcmetro said:

As for the article, the $15 million generated for transit was likely eaten up by the demolition and acquisition or administrative costs or is just sitting in the account in anticipation of paying the construction costs.

Most likely the former, as the CT Board approved the acquisitions with nary a peep about how it would pay for them.If you go way back, I surmised how could CTA justify on a normal environmental review needed to get federal funding doing the stuff the denizens of Lakeview were complaining about. If the TIF money paid for that,then that would not be a concern.

Note that this is based on what I concluded from what happened, not an audit of CTA's books.

[Tcmetro]

Hey Busjack, looked into it some more. Here is Cook County's report on the TIF and who received how much of the $40 million.

https://www.cookcountyclerk.com/sites/default/files/pdfs/2017 Transit TIF RPM1 Fact Sheet_0.pdf

 

Here is the County's FAQ sheet about how TIF works in general.

https://www.cookcountyclerk.com/sites/default/files/pdfs/2017 TIF FAQs.pdf

 

The relevant quote about how  normal TIFs do not return any increment is on page 5:

Quote

Other taxing districts, such as Schools, Parks, and Libraries, only have access to the base taxable value within the TIF district at the time its created for its duration (typically 23 years). Any tax revenue generated from the value growth within the TIF is directed to the TIF itself.

...

Transit TIFs differ from traditional TIFs in that there is no hardship requirement and they may last for 35 years. Additionally, part of the tax revenue generated from the value growth within the Transit TIF is distributed to taxing districts.

--

Specific to the Red Line Phase 1 costs, the TIF redevelopment plan estimates land acquisition and demolition at ~$31 million, for what it's worth.

https://www.cityofchicago.org/content/dam/city/depts/dcd/tif/RPM_RDP.pdf - page 24

[Busjack]

15 minutes ago, Tcmetro said:

Hey Busjack, looked into it some more. Here is Cook County's report on the TIF and who received how much of the $40 million.

https://www.cookcountyclerk.com/sites/default/files/pdfs/2017 Transit TIF RPM1 Fact Sheet_0.pdf

 

Here is the County's FAQ sheet about how TIF works in general.

https://www.cookcountyclerk.com/sites/default/files/pdfs/2017 TIF FAQs.pdf

 

The relevant quote about how  normal TIFs do not return any increment is on page 5:

--

Specific to the Red Line Phase 1 costs, the TIF redevelopment plan estimates land acquisition and demolition at ~$31 million, for what it's worth.

https://www.cityofchicago.org/content/dam/city/depts/dcd/tif/RPM_RDP.pdf - page 24

Thanks. That's obviously the the primary source, as the Tribune was quoting Orr.

What that clarifies is that transit was only supposed to get 37% of the increment, which is $15 million. The Tribune was making it sound like Emanuel was being magnanimous in giving the other units the other 63%, when the law said they were entitled to it anyway.