Ald. Reilly spurns new East Loop TIF
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(Crain’s) — Alderman Brendan Reilly (42nd) said he doesn’t support a new tax-increment financing district for the East Loop.
Mr. Reilly said the proposed TIF district was advanced by a handful of property owners who funded a TIF eligibility study and tried to convince him and other city officials that their properties were eligible. Mr. Reilly said he doesn’t believe the area merits TIF aid.
“Owner reinvestment and market forces should ultimately decide ‘winners’ and ‘losers,’ not TIF subsidies,” Mr. Reilly said in a release. “The East Loop TIF proposal appears to provide a competitive advantage to those properties within the proposed TIF boundary. The intent of TIF was never to place surrounding properties (directly outside of the district, of similar age and class) at a leasing disadvantage. This proposal would very likely have exactly that effect.”
Sources said the owners believed they had City Hall’s support for an East Loop TIF, and that the alderman’s stance makes it unlikely the City Council would approve it. A spokeswoman for the city’s Department of Community Development says the Daley administration hadn’t yet taken a position on the matter or begun formal consideration of the proposal, and had been reaching out to Mr. Reilly to get his input.
“We didn’t know how the alderman felt about it, and today we found out,” the spokeswoman said.
The proposed TIF district covers almost 39 acres and 34 commercial buildings, including: Aon Center, 1 and 2 Illinois Center, Michigan Plaza at 205-225 N. Michigan Ave., 1 and 2 Prudential Plaza, Harold Washington College, and the London Guarantee Building at 360 N. Michigan Ave. (where Crain’s leases office space).
The boundaries are roughly Wacker Drive to the north, Randolph Street to the south, Columbus Drive to the east and Wabash Avenue to the west.
A summary of the April 23 TIF eligibility said the area would qualify for TIF money because property values haven’t grown as much as the rest of the city, 80% of the parcels have shown deterioration, old water-and-sewer infrastructure exists, and there is high vacancy of older Class C buildings there.
But the alderman wasn’t convinced.
“I do not agree that the needs within the proposed boundary come close to meeting the threshold level of obsolescence or deterioration the Illinois statute was designed to address,” Mr. Reilly wrote in a letter to Matthew Amato, a Jones Lang LaSalle Inc. executive who is general manager of the Aon Center. The 82-story skyscraper is owned by Piedmont Office Realty Trust and managed by Chicago-based Jones Lang.
Mr. Amato, who according to Mr. Reilly’s letter is involved with the group that funded the TIF study, wasn’t available for comment.
The property owners and Chicago Loop Alliance, a downtown business group, had hoped a TIF district might help fund improvements to the stretch of Michigan Avenue between the Chicago River and Millennium Park, said Ty Tabing, the alliance’s executive director.
Mr. Tabing’s organization, which didn’t help fund the study, doesn’t have a position on the TIF district but early last year proposed a host of upgrades for the region.
“TIF was the tool that would have been useful for improving that strip of Michigan Avenue,” Mr. Tabing says. “Maybe we’ll come up with something else.”
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That's a loophole big enough for a Mack truck to drive through. And the cabal of law firms (Barnes Thronburg in particular) has had a field day here the last few years, peddling these creatures to every easily-flattered mayor they can mesmerize.
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As for TIF's, if people really understood what they are doing to the City and their pocketbooks, they would understand that their real estate taxes are raised in relationship to every TIF dollar that is diverted into the TIF fund controlled and allocated by - guess who - Mayor Daley. TIF's cost everyone in this city other than the friends of the Mayor who benefit from what is effectively a slush fund. Not to say that TIF's are not important to rebuild "blighted" areas, but to say that in Chicago it has been used to fund pet projects that increase the Mayor's power base and his friends pockets.
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