Just when I thought I could take no more depressing news about COVID-19, or Trump, or our impending economic collapse, along comes the city with a little happy news to lift me from my funk . . .
It’s another multimillion-dollar TIF deal for the South Loop—at the site of the former Michael Reese Hospital, no less.
Oh, happy days—TIF scams to write about. As opposed to the end of civilization as we know it. It’s the little things in life, my friends.
OK, for all who have forgotten . . .
Tax increment financing is a program in which the city slaps an undisclosed surcharge on your property taxes and diverts the money into a slush fund the mayor is pretty much free to spend as she wants.
Earlier this month the city announced it was thinking of spending up to—well, they haven’t gotten around to revealing precisely how much TIF money they will spend—redeveloping the old Michael Reese site at 31st and Cottage Grove.
At the moment, they say they’ll dedicate $31 million in TIF funds to clean up the waste left from an old radium processing plant on the site.
If all goes well, Farpoint Development will oversee a $3.5 billion mixed-use project, anchored by a medical research facility run by Sheba Medical Center, an Israel-based operation.
There may be housing, retail, a new Metra station, a community center, and a park on the site. The key word being may—’cause it’s down the road. As in, we’ll see.
Construction on the medical center should start next year, once the city and Farpoint work out the details of that TIF deal. Which, I assume, they’ll eventually get around to sharing with us.
According to the city, we can thank Mayor Rahm for this project—he was the one who got Sheba Medical Center interested in the location.
Now, wait a minute, everyone! Just because Mayor Rahm had something to do with this doesn’t mean it’s automatically as bad as, oh, Lincoln Yards, that stink bomb of a boondoggle Rahm got the City Council to pass as he left office.
In fact, at the risk of sounding hopelessly naive, this actually could be a worthwhile TIF deal. They’re proposing to take city-owned land that nobody knows what to do with and put it back on the tax rolls—creating jobs as we head into an economic depression.
So, that’s good, right?
Well, it’s too early to tell exactly how good it is. As, again, the city has not revealed how much TIF money this thing will cost us.
Think of it like buying a car—you don’t know if you’re getting a good deal until you see the price tag.
Let me remind you that as a rule of thumb, it pays to be skeptical about TIF deals—as we learned from the aforementioned Lincoln Yards deal. A few details . . .
In 2017, Mayor Rahm announced—good news, Chicago! The city sold its old north-side fleet facility—across the street from the Hideout—to Sterling Bay for about $105 million.
Then Mayor Rahm paused to let you jump for joy. Man, he must really think you’re stupid, people.
Two years later that same Mayor Rahm got the City Council to give Sterling Bay $1.3 billion to develop that abandoned fleet facility—and many surrounding parcels—into Lincoln Yards.
All in all, Mayor Rahm effectively returned the $105 million—and then some—to Sterling Bay.
You might say, Sterling Bay got prime, north-side real estate for free. Something to think about the next time any mayor tells us we’re too broke to pay for school nurses.
In defense of Mayor Lightfoot—she brought in a new commissioner to run the Planning Department. His name is Maurice Cox, and he swears up and down he’ll make sure TIF dollars are more wisely, prudently, and equitably spent.
I’m rooting for you, Mr. Cox. But beware—there are lots of sharks in these waters.
In general, Mayor Lightfoot has promised to never, ever sign onto a boondoggle like Lincoln Yards. We shall see.
By the way, Michael Reese is also part of a boondoggle.
In 2004 as the old hospital was going bankrupt, the site was purchased by Medline, a medical supply company from the northern suburbs, for about $24 million.
A few years later, Mayor Daley came up with the not-very-bright idea of bidding to host the 2016 Olympics.
Needing to show the International Olympic Committee that we had a sufficient place to build an Olympic Village to house athletes, Daley paid top dollar to buy the land from Medline.
Medline wound up having some $91 million fall into its lap just before the housing market collapsed with the recession of 2008. And the city, of course, didn’t win the Olympic bid.
As Bob Dylan put it in an old song—“I can’t help it if I’m lucky.” By the way, the name of that song is “Idiot Wind.”
Mayor Daley swore up and down that the purchase of Michael Reese would not cost taxpayers a dime.
He said we would make the money back, even if the Olympics didn’t come to town.
He said the land was so valuable that someone would eventually swoop in to buy it.
That’s what he told you, people. As the movers and shakers of Chicago nodded along.
Like I said—it pays to be skeptical about what the powers that be promise when it comes to TIF deals.
I don’t think we’ll ever recover the $91 million we paid Medline for the Michael Reese land, no matter what gets developed there.
In the end, Medline, one remarkably lucky company, walked away with more TIF money than many west- and south-side neighborhoods will receive in years. And the program is intended to eradicate blight in poor communities.
It’s like Bob Dylan wrote that song about us. v