The city blinked.

That’s the initial reaction from people in Lincoln Square regarding the city’s retreat from plans to use eminent domain to force out all the businesses on the east side of the 4800 block of North Western. On the proposed deal the land would have been turned over to an undetermined developer, who would replace the existing buildings with condos and retail. Funding for the acquisition was to come out of the Western/North TIF.

It was actually one of the more interesting twists on use of the program. TIFs (or tax increment financing districts) are intended to subsidize development in blighted communities that would otherwise find it difficult to attract investment. In this case, however, 47th Ward alderman Gene Schulter was seeking public funds to keep private development out — at least a certain kind of private development.

Schulter contended that the commercial strip, with its booming residential base, was starting to attract the interest of big-box chains. By beating the big boxes to the punch, he said, his plan would actually protect small businesses and help keep the community free of too much traffic and congestion. Sure, in this case protecting small businesses meant threatening them with government seizure of their property. But the declaration of eminent domain alone would help keep the Best Buys at bay: there’s no market for land the city can snatch at will.

It was a classic case of the up-is-down, down-is-up logic peculiar to TIFs. As mandated by state law, the city commissioned a consultant’s report, which argued that the area needed a TIF handout to stave off blight and underdevelopment. Meanwhile Schulter and planning officials kept insisting that tens of millions were needed to prevent overdevelopment.  

Most TIF deals are consummated in the shadows, with hardly any opposition. This one attracted major heat from the start. Merchants and property owners on the block didn’t want to sell, and resented the threat of being forced to. It was, they said, downright un-American for the city to snatch one person’s property only to turn it over to someone else. The Castle Coalition, a national property-rights organization, rallied to the cause. On December 5 some 300 residents showed up for a rally at Chicago Soccer, a sporting goods store at 4839 N. Western. After the meeting, a large group of protesters marched over to Schulter’s Lincoln Avenue office to demand that he drop the scheme.

On Monday, December 10, just two days before the City Council was scheduled to vote on the proposal, Schulter called several merchants to his office to tell them the city had had a change of heart. (Schulter has since said he’ll submit a revised ordinance to the housing committee in January.)  

Why’d the city back down? Schulter says what he’s maintained all along: the plan was never written in stone, and he listens to the desires of his community.

I suspect the December 5 demonstration had something to do with the turnaround. Residents left Schulter’s office that night vowing to turn up at City Hall in even greater numbers if the matter came to a vote. Of course, the last thing Mayor Daley or his planning department needs is a storm of protest. If a big crowd showed up to scream and yell over a TIF project, the mainstream press might have to start asking questions about the slush fund that sucked up some $500 million in property taxes last year. The fewer people who know about TIFs, the better.