CHICAGO (CBS) — Hours after Mayor-elect Lori Lightfoot dropped her opposition to $1.6 billion in tax subsidies for two massive development deals, the City Council on Wednesday gave its final approval to the projects known as Lincoln Yards and The 78.
In a statement Tuesday night, Lightfoot said Lincoln Yards developer Sterling Bay and The 78 developer Related Midwest had agreed to increase the amount of construction work that would go to women- and minority-owned firms by $80 million, to $400 million overall.READ MORE: Thieves Keep Using Postal Master Keys To Steal Mail: How Are They Getting A Hold Of Those Keys?
“I am not yet the mayor, and I recognize that the current administration and City Council must decide whether to carry this vote forward according to the interests of the constituents they serve,” Lightfoot stated. “Either way, upon swearing in, I will engage with the community and committed activists who have advocated forcefully for affordable housing, park space and the responsible use of tax increment financing dollars for many months.”
Lightfoot’s support paved the way for the Finance Committee and then the full City Council to approve $900 million in tax increment financing for Lincoln Yards, and $700 million in TIF funds for The 78.
The City Council approved the tax deal for The 78 with no debate, on a 31-13 vote. Aldermen held only a brief debate before approving the Lincoln Yards deal 32-13.
“This is a pretty good deal for the city of Chicago, no matter how you slice it,” Finance Committee Chair Patrick O’Connor (40th) said before the final vote.
Protesters from various community organizations gathered outside the council chamber during the Finance Committee meeting, with a few activists inside the meeting interrupting aldermen as they prepared to vote.
One activist with the group “Raise Your Hand,” a coalition of public school parents, said the vote to approve TIF money for the projects is disappointing, saying it will deprive schools of much-needed funding.
“Our schools are at such bare bones, and we’ve been out for nine years now talking about this, and what our students, our children need in the city of Chicago; and something like this just scares me. I don’t know what else could possibly be taken from our schools,” Jennie Biggs said.READ MORE: Chicago Weather: Wednesday Starts On A Chilly Note
Under TIF districts, property taxes collected within designated areas of the city are frozen for up to 23 years. New property tax revenue created by rising property values within the TIF districts is dedicated to improvements within the areas, meaning taxing bodies like the Chicago Public Schools don’t benefit from rising property tax revenue within the districts.
The TIF subsidies for Lincoln Yards and The 78 will reimburse the developers of the projects for infrastructure work — such as new roads, bridges, and more — that will be part of the ambitious construction plans.
Sterling Bay is developing Lincoln Yards, a $6 billion project along the north branch of the Chicago River between Bucktown and Lincoln Park. Related Midwest is the developer for The 78, a $7 billion project planned for a largely vacant stretch along the south branch of the Chicago River between the South Loop and Chinatown.
Lightfoot said she met with both developers on Tuesday to discuss the projects.
“As a result of those conversations, I am pleased to report that both developers agreed to meaningfully strengthen their commitments to minority-owned and women-owned business enterprises,” she said. “These changes represent a vital sign that my administration will be able to make progress toward an equitable and fair deal for our communities.”
Lightfoot said there’s still a lot more work to be done on both projects to ensure a fair deal for taxpayers, but she said she’s confident the city has sufficient controls that “will allow for us to further improve these deals and to bring community voices into the process going forward.”
“In making future decisions about these and all other deals, we will work with stakeholders to allow for robust community input from the beginning and throughout,” she added.
Critics have said there’s not enough affordable housing included in the projects, and what is included is too expensive for most low-income families. They also have said the developers do not need hundreds of millions of dollars in property tax revenue to pay for infrastructure improvements like new roads and bridges, when existing neighborhoods already have significant infrastructure needs.MORE NEWS: View Live Radar
“We have billions of dollars that we are proposing to hand to wealthy developers who do not need this money,” said Amisha Patel, executive director of Grassroots Collaborative. “At the same time we have communities on the South and West sides that do not have the infrastructure, do not have the investments, do not have the ability to create jobs in the ways that they need to and deserve to, and that is not right.”