OIG’s Newest Report Confirms Failure of TIF System

On Monday, Inspector General Joseph Ferguson’s office filed a report evaluating the city’s progress on a series of recommended reforms put forward by former Mayor Rahm Emanuel’s Tax Increment Financing Reform Panel. The report found that over the last 8 years, none of those recommendations have been fully implemented. Chicago Lawyers’ Committee for Civil Rights released the following statement:

“The problems described in the OIG’s report this week explain how a financial instrument that was designed to help struggling communities is instead subsidizing luxury projects in wealthy areas. Our lawsuit challenging the City’s recent approval of a mega-TIF for Lincoln Yards, on behalf of Grassroots Collaborative and Raise Your Hand for Illinois Public Education, is a case in point.

While communities of color on the south and west sides lose precious resources, the Lincoln Yards site rests between three of Chicago’s most affluent communities. How can this attractive riverfront area, which was pitched to Amazon for its second headquarters as “the best capitalized site in Chicago,” qualify for up to $1.3 billion in public tax money?

The OIG’s report shows that the City has failed to communicate its justifications when it concludes that private development would not occur without TIF funding. In the case of Lincoln Yards, we contend there simply is no justification that meets the legal standards.

The City’s mismanagement of TIF funds is not a victimless crime. The Lincoln Yards TIF will disproportionately benefit a majority-White population at the expense of low-income majority-Black and Latinx communities, who will see tax increases without receiving benefits from the TIF. These financial burdens exacerbate the residential segregation that have over time perpetuated our city’s unjust pattern of racial inequities.

The impact of TIF on Chicago’s racial disparities has never been fully examined by the City, not even by the 2011 TIF Reform Panel. Where there should be a robust discussion about the concentration of TIF money in White areas and its impact on communities of color, there is only silence. Our plaintiffs have joined other community groups in calling for a Race Equity Impact Analysis to be applied to the City’s TIF process to address this need.

After 8 long years of inaction, it is time to bring real transparency and accountability to the TIF system. We are heartened by Mayor Lightfoot’s response to the OIG report and her pledge to reform this broken process; until that time, the City should freeze its illegal plan for Lincoln Yards.”

Kailee Nardi