I’d like to thank Trib columnist David Greising for his January 16 story about how the Olympic Village will be paid for with Tax Increment Financing dollars.
The lede was funny and I think his story will make it harder for Mayor Daley to get away with the fantasy that the games won’t cost the public any money.
But just to clarify one point with TIFs: they don’t work quite the way the article says. “TIFs are Mayor Richard Daley’s favorite tool to spur development by cutting taxes for developers, business owners and other beneficiaries. In essence, taxes on a specified neighborhood are frozen for more than 20 years, saving developers and property owners millions of dollars as the properties increase in value.”
Yes, TIFs do freeze the property taxes in a TIF district for up to 24 years. But don’t be fooled into thinking they freeze the amount that property owners pay. Far from it. What gets frozen is the amount of property tax dollars the schools, parks, county, and other taxing bodies get out of the TIF district. If the taxing bodies are getting $100 from the district when the TIF’s created, that’s all they’ll get until the TIF expires.
Property owners, on the other hand, can expect to see their tax bills rise as the years go on. The increase in taxes that they pay after the district is created gets funneled into bank accounts–call `em slush funds–largely controlled by Mayor Daley.
Think of TIFs as tax hikes. They force the schools, parks, county and other taxing bodies to take in more money from taxpayers to compensate for the money they’re not getting from the TIF districts.
It’s easy to see why anyone would be confused because the city has been issuing misleading information about TIFs for years. That’s why I call it a scam.