'Broken' TIF system needs overhaul, says Cook County clerk
Cook County Clerk David Orr is calling on Chicago officials to overhaul special taxing districts that siphon millions of dollars from local taxing bodies, and his request comes as aldermen and some mayoral candidates cling to these districts as a golden ticket to solving some of the city's problems, like creating more affordable housing and hiring more police officers.
Tax increment financing districts, or TIFs, are supposed to help spur economic development in blighted areas. They do this by freezing property taxes that would normally go to schools, the park district and others. When taxes go up, the extra cash is supposed to be used on infrastructure improvements and subsidies to developers.
Orr said Chicago raked in almost $520 million from TIFs last year, an increase of about five percent, and he said it's not entirely clear where that money is going.
"That, I think, is a travesty, particularly in these hard economic times," he said. "Taxpayers have a right to know how this money is being spent."
Orr said city officials need to place a moratorium on new TIFs, include the districts in the city's budget process, and ensure all unused money in the districts is distributed back to taxing bodies.
We left a request for comment with Mayor Richard Daley's office, but we didn't receive a response. The mayor used about $39 million from the districts to help balance his final budget, which the City Council approved last week. Orr cautioned against using TIFs as a "rainy day fund."