City should have turned to TIFs instead of property tax hikes: study
“What the City of Chicago spent in each of the last several years on tax-increment financing funding exceeded what it owed in pension costs, so any proposal to raise property taxes to fund pensions should consider TIFs, wrote the authors of a study to be released Friday titled, “Putting Municipal Pension Costs in Context: Chicago.”
For 2012 alone, the city owed $385.8 million to its pension funds while putting $457 million in property taxes into its TIFs, wrote Thomas Cafcas and Greg LeRoy, of Good Jobs First, a Washington, D.C.-based think tank that examines public subsidies. TIF revenue more than tripled since 2000, when it was about $129 million, they said, and once the money comes out of the city’s general fund, its uses are curtailed by law.
Meanwhile, in a pension deal that must be approved in Springfield, Mayor Rahm Emanuel has proposed raising property taxes and pension reform for retired laborers and certain other city workers, including school clerks and classroom aides.
“What we’re saying in the report is that any fair budgeting discussion that happens around the pensions certainly should include the enormous amount of revenues that are being diverted by TIFs,” Cafcas said. “A picture of the sky falling everywhere in Chicago is being painted. We think all of the city’s budget should be considered here.””
Fitzpatrick, Lauren. Chicago Sun Times 3 April 2014.