CHICAGO (CBS) — A City Council committee has delayed an effort to tighten the rules for the city’s often-criticized tax increment financing system.
Ald. Ricardo Munoz (22nd), one of 18 co-sponsors of the proposed ordinance, said the council’s Progressive Caucus wants to change the rules for providing private developers with TIF money for construction projects.
“This is a proposed change to our TIF policy that would require all new TIFs – new TIFs – to actually be defined as blighted and dilapidated,” he said.
The original intent of tax increment financing districts was to attract investment to crumbling neighborhoods, but have often been set up in areas where critics believe they aren’t needed – such as downtown and the LaSalle Street financial district.
Ald. Scott Waguespack (32nd) said the so-called “TIF Back to Basics” ordinance would ensure projects receiving TIF money would meet specific requirements.
“TIFs were originally designed to create economic development in blighted areas; areas that have no incentives, that they don’t have the ability to create economic development by themselves,” he said. “What we’ve seen, obviously, over the years is you get the Central Loop, you get the LaSalle TIF.”
Sponsors said the test now would be that a project could only get TIF money if it could not be completed without it.
However, some aldermen worried some needed projects would not meet the threshold proposed by the Progressive Caucus.
“I do have some reservations of limiting tools that many of us need to get communities back on track,” Ald. Jason Ervin (28th) said.
Waguespack said the Emanuel administration also has concerns about the ordinance, so it will be held in the Finance Committee for further discussion.