- Brian Jackson/Sun-Times
- If Rahm’s looking for a steady flow of taxes to pay off the city’s pension obligations, look no further than the invisible tax hike that starts with a T and ends with an F.
As part of my mission to help Mayor Emanuel get out of his predicaments even if they are of his own making, I’m trying to figure out a way for him to finance his great pension scheme without pissing everyone off.
Last I looked he was searching for hundreds of millions of dollars to feed the fire, police, teachers’, and municipal employees’ pension funds.
So where, oh, where, could that money be?
It could be kind of tricky, coming up with this kind of money. He’d have to be pretty sneaky in the way he goes about it.
So it has to be a secret source of taxation, one that he can enact while pretending he’s not enacting it.
And it has to be relatively painless for the public to pay. By that I mean it has to be something that people are already paying without realizing they’re paying it. So the mayor doesn’t freak the shit out of everybody as he would with a newly imposed tax, fee, or fine.
The money has to be fungible, meaning he can basically spend it wherever or however he wants.
Also, it should be something that Chicago’s civic and corporate leaders can pretend is evidence of the mayor’s fiduciary wizardry, so they have a justification for throwing more campaign contributions his way.
In short, the mayor’s looking for some sort of financial trickery with which he can deceive the taxpaying public.
Hmm . . .
I know! His TIF funds. Dang, and it was right in front of my face the whole time.
As we know, the tax increment financing program is supposed to subsidize development in the poorest neighborhoods.
But it’s really just a mayoral slush fund funded by a property tax surcharge that most of us pay even though we don’t realize it. Because our property tax bills don’t itemize it.
So it’s an easy way for the public to think we’re not paying it. And it’s not like many elected officials are going out of their way to remind us we’re paying it.
At the moment, I believe Cook County clerk David Orr is the only local official who even talks about the TIF tax. He explains how it works on a video that you can find on his website. (Actually, it’s not Orr narrating the video, but an anonymous narrator with a nice voice. Here, watch it yourself.)
In any event, the TIF tax is as steady as March rain. It’s been bringing in roughly $450 to $500 million a year for the last ten or so years.
So the mayor can claim he didn’t raise your property taxes, even though he did. And the aldermen can say they never voted for a tax hike, even though they did. And you can blissfully go through life unaware that the whole thing even exists.
Unless you read my posts—in which case, I’ll be reminding you week after week after week . . .
But wait, I can read your mind. You may be wondering whether using TIF money to fund the pensions might be a stretch even for the mayor’s slush fund. Maybe it would even be, you know, illegal.
But that’s no problem at all. First of all, hardly anyone’s paying attention. And even if someone squawks, the mayor can ask house speaker Michael Madigan to change the state law governing TIFs. I’m sure the state reps and senators will do as told—just as if they were aldermen.
I know, I know—if you spend the TIFs on pensions, you can’t use that money for schools, as some are suggesting we should. But let’s be real, people—the mayor has no intention of returning TIF money to the schools he took it from in the first place.
He doesn’t want to do that for the same reason he probably won’t use TIF money for pensions. That would mean he couldn’t spend it on his pet projects—like you-know-what in the South Loop.
The mayor would probably rather hit us all with another tax hike than give up his slush. Oh, well—I tried.