Grassroots Collaborative and Raise Your Hand
v. City of Chicago: Learn the Basics
To learn about Tax Increment Financing (TIF), read Chapter 2 in our land use guide.
Public Money Shouldn’t Subsidize Luxury Developments
The Cortland and Chicago River TIF District is located in one of the most attractive riverfront areas of the city, surrounded by Bucktown, Wicker Park, and Lincoln Park - three of the most affluent areas in Chicago.
According to state law, a TIF district can only be created if the area “would not be reasonably anticipated to develop” without the TIF - but, as early as 2013, Sterling Bay began purchasing land in the area which it believed were “underutilized, undervalued and positioned for redevelopment.”
Our complaint alleges that the area around Lincoln Yards does not meet the definition of “blight” under state law, nor does the area qualify as being dependent on public taxpayer funds to spur economic development, and therefore it violates the state’s law on TIF.
The Cortland and Chicago River TIF is Discriminatory
The population within a half-mile radius of the center of the Cortland and Chicago River TIF District is nearly 80 percent White and is only 12 percent Hispanic and 4 percent African American.
According to state law, a TIF district can only be created if the area “would not be reasonably anticipated to develop” without the TIF - but, as early as 2013, Sterling Bay began purchasing land in the area which it believed were “underutilized, undervalued and positioned for redevelopment.” And the value of building permits for new construction in the immediate area, which was almost double that of the rest of the city over the past 13 years, clearly contradicts the notion that the area was not ripe for development. See Figure 6.
Providing an enormous public subsidy of up to $1.3 billion in a wealthy, majority-White area undermines investment into low-income, majority-African American and majority-Hispanic communities that truly need public dollars to see private development.
The Cortland and Chicago River TIF District will also result in a tax increase for properties outside the TIF District, including among communities of color. This increases the financial burden on those neighborhoods and deepens segregation in Chicago.
Chicago’s TIF System as a Whole is Racially Inequitable
The amount of money that is being spent by the City on TIF Districts is concentrated in areas that are majority-White, such as the Cortland and Chicago River TIF.
By enabling TIF Districts to be created in areas that fail to meet the state’s legal standards, the City not only has violated state law but its administration of the TIF system also has been racially and ethnically discriminatory.
Hundreds of millions of tax dollars collected from taxpayers have disproportionately benefited majority-White census tracts to the detriment of majority-African American and majority-Hispanic census tracts.