Last February members of the Rogers Park Community Action Network saw an article in Loyola’s student newspaper, the Phoenix, about a proposed tax increment financing zone for the area surrounding the university, and their blood began to boil. For several years members of RPCAN, a community organization that fights for affordable housing and tenants’ rights, had worried that someone would try to put a TIF in the neighborhood, and now someone was trying to.

In general, TIFs are urban renewal plans meant to spur residential and commercial development in blighted areas by offering developers tax breaks, subsidies, and loans. RPCAN members argue that Rogers Park has had plenty of development in the past decade and hardly qualifies as blighted. Having waged numerous battles over the years to prevent buildings that are home to low-income tenants from being demolished or converted to condos, they see TIFs as helping to fund the kind of large-scale retail projects and upscale residential developments that will only displace more low-income residents and small businesses.

They’re not alone in this perception of TIFs. Residents in neighborhoods from Pilsen to Albany Park have fought them, fearing they’ll spur gentrification and displacement. In 1997 Latino residents in suburban Addison won a $4.3 million judgment in a class-action lawsuit against the village after alleging that they’d been displaced because of a TIF.

John Paul Jones, an analyst with the Neighborhood Capital Budget Group, a nonprofit coalition that lobbies for more democracy and openness when TIFs are created in the metro region, says the proposed Devon-Sheridan TIF could drive people out. “TIFs are clearly becoming real estate tools that bring in all kinds of high-end uses, and displacement is an issue,” he says. “But TIFs aren’t necessarily something that have to displace. You have to see who benefits the most and make sure there is parity.”

Three years ago RPCAN members had heard rumors that a TIF was being proposed for the Morse Avenue commercial strip. They held meetings and organized a march they say drew 400 protesters. The local alderman, Joe Moore, who’s clashed with RPCAN many times, says the idea of a Morse TIF “was casually kicked around from time to time” but was “never talked about as anything tangible” and never became an official proposal. The chairman of RPCAN’s board, Fran Tobin, insists Moore talked about specific plans for a Morse TIF at a meeting attended by city officials and the local development group DevCorp North during the summer of 2000. Moore doesn’t remember saying anything specific at the meeting, and DevCorp North director Kimberly Bares says that while representatives of her organization did make a presentation, it was primarily about streetscape improvements for Morse Avenue.

Tobin insists RPCAN helped derail the TIF. “That’s totally manufactured,” says Moore. “They’re claiming a victory about something that never happened.”

At any rate, there’s no doubt that plans for a TIF in the area around Loyola University exist. The idea was first discussed by the local aldermen–at the time the area included parts of the 40th, 48th, and 49th wards–and city planning officials several years ago. The city even allocated money for a feasibility study, which looks at such things as a neighborhood’s vacancy rates, the age and condition of its buildings, and the amount of new development to see if it qualifies for a TIF. But Moore says a TIF wasn’t a high priority for him or the other aldermen, and the study was never done.

Meanwhile Loyola was having serious financial problems. After Loyola Medical Center split from the university in 1995, the school went into a slide that was exacerbated by low enrollment and a low return on its investments. By the end of its 2001 fiscal year it had a deficit of $35.2 million. Last summer university officials predicted a $17.4 million deficit for fiscal 2003, though the final figure turned out to be only $9.1 million.

A TIF wasn’t likely to gain the school any quick cash, but it could help fund new development projects on campus and lure new retailers to the surrounding commercial strip, which might help increase enrollment. So last year Loyola officials approached Moore and 40th Ward alderman Patrick O’Connor about resurrecting the section of the TIF in their wards, even offering to have Loyola fund the feasibility study. It’s not unheard-of for development companies or other interested parties to fund TIF feasibility studies, but critics note that the practice raises questions about objectivity.

Both O’Connor and Moore went for the plan, and Loyola hired S.B. Friedman & Company to do the study, which started last January. Loyola’s director of community relations, Jennifer Clark, says that since the study isn’t completed, there’s no estimate yet on how much it will cost.

The two aldermen set up a task force consisting of them and 15 other people to draft a TIF proposal. The task force finished the draft in July, and the aldermen are now working on a final version that will be presented at a public hearing, most likely sometime this fall, then voted on by the city’s Community Development Commission and by the City Council.

The proposed TIF consists of two strips, one running along Sheridan and Devon from the lake to Clark, the other along Broadway and Sheridan from Rosemont to Pratt. The Devon stretch contains mostly small businesses and restaurants; the Sheridan section is a mix of courtyard apartments, cafes, restaurants, and retail stores. The apartments are rented by a racially diverse mix of college students and faculty, senior citizens in assisted-living facilities, and working singles and families. The Loyola campus is the largest property holder within the TIF area.

TIFs attract development by freezing the amount of property taxes from the area that go to the general city coffers at their current level and then allowing any property taxes above that level to be used for various projects, including anything from bringing in national chain stores to making facade improvements on existing businesses to setting up community arts or youth programs.

The city’s Department of Planning and Development and the local alder-men get to decide how the funds will be distributed. DevCorp North’s Bares, a member of the task force and a big proponent of the Devon-Sheridan TIF, says that gives the community more control over what kind of development happens. “Any development would have to be in accordance with the goals and objectives outlined in the TIF redevelopment plan,” she says. “I think there is a consensus in this neighborhood that we want small development, and that will be reflected in the TIF plan.”

But many people are suspicious of TIFs. In the past year they’ve been the focus of at least three lawsuits in the Chicago metro area. In July, Robin Realty & Management sued the village of Hoffman Estates claiming that a proposed TIF would make it harder for a shopping center the company runs to attract tenants, because they’d be afraid the village would seize the land using its powers of eminent domain. In June the Illinois appellate court supported the Pleasantdale school district, which feared it would lose tax dollars and had argued that the town of Burr Ridge wasn’t blighted and therefore shouldn’t qualify for a TIF.

RPCAN members and other opponents of the Devon-Sheridan TIF point out that Rogers Park isn’t plagued with vacant lots. Instead, they say, property taxes have been rising quickly as the area has gentrified. Between 1996 and 1999, according to Loyola’s Center for Urban Research and Learning, 1,029 rental units were converted to condos.

“We have our thriving businesses,” says Jonathan Roth, a part-time Columbia College student and RPCAN member who works in a local health-food store. “For example we have the Devon Market with all these international foods–people from all over the city go there. But that’s something that could be forced out by rising property taxes. This area is running fine on its own. It’s not a blighted area.”

Clark says blight isn’t the only issue. “Whether an area is eligible for a TIF or not is not a subjective thing,” she says. “There are objective things that outside consultants look at, such as number of vacancies, number of vacant lots, age of the infrastructure.”

And in fact the Devon-Sheridan TIF wouldn’t be an ordinary TIF but a conservation TIF, a form created by the state legislature in 1999 as a way to stabilize the economy and rehab or preserve buildings in a neighborhood that isn’t truly blighted but, according to the municipal code, “may become a blighted area.” The Neighborhood Capital Budget Group’s Jones says it’s relatively easy to get a conservation TIF: one of the main requirements is that half of the buildings be at least 35 years old.

Jones and the NCBG are concerned that instituting TIFs of any sort in relatively well-off neighborhoods such as Hyde Park and Albany Park is having a negative impact on the city’s general revenue. He says that last year the city’s 128 TIFs sucked up about $392 million in taxes–money that might otherwise have gone for things such as schools and infrastructure repairs. “With all these TIFs in lucrative tax-generating areas on the north side,” he says, “you’re putting taxing bodies in danger of not being able to collect the revenue needed for public services.” He says he isn’t against TIFs in general, but he thinks there are better ways to stimulate development in already vibrant areas like Rogers Park and Edgewater.

Some of the TIF’s opponents aren’t happy that Loyola could be the major beneficiary of TIF funds. For one thing, they say, a major university–a church-based one at that–shouldn’t be getting taxpayer subsidies or diverting taxpayer funds from general revenues. Loyola does pay taxes on its commercial properties and on the apartments it owns and rents through private management companies, but anything related to the school’s business of education–dorms, lecture halls, common areas–is tax-exempt. TIF opponents also point out that Loyola is already doing better financially without the TIF: the board of trustees is predicting a surplus of $2.3 million in fiscal 2004, and undergraduate enrollment is up.

Clark says that Loyola doesn’t have any specific plans for developments that would use TIF funds, but she adds, “We know that somewhere along the line we are going to need new student residence halls, more parking spaces, and above all, increased retail opportunities. We’re interested in revitalization of the commercial districts on Sheridan and Devon for not only the university and the faculty but the community at large. We think of Devon and Sheridan as gateways into our campus and from our campus out into the community at large.”

Tobin has an internal memo titled “Loyola University Chicago, Sheridan-Devon Tax Increment Financing District University Redevelopment Objectives,” which he says he got from an anonymous student at Loyola’s Center for Urban Research and Learning. The memo lists projects the university wants to fund with the help of the TIF, including an undergrad residence hall for about 600 students, a graduate residence hall for about 400 students, “enhancing the retail attractiveness of Sheridan Road between Albion and Devon,” and “creatively and tastefully addressing the safety of pedestrian crossing from the west side of Sheridan” to the campus.

However they feel about the specific projects, many TIF opponents are also angry that all 17 members of the task force that drew up the rough draft of the TIF proposal were white and all of them were property owners, even though Rogers Park has an extremely diverse population and a high number of renters. The 2000 census showed that 32 percent of residents were white, 30 percent African-American, and 28 percent Hispanic, and that 81 percent of the housing units were occupied by renters, though many of them were Loyola students.

“They should have people from nonprofits, people who have been homeless, renters, people of different races on the task force, but they don’t,” says Robin McPherson, an African-American mother of two and RPCAN member who owns an apartment in a co-op at Pratt and Ashland. “I think the process was unfair and unjust. We need to have a say in how our tax dollars are used too.”

Moore concedes that the task force members were all white and all property owners, but he says that’s because it was made up of representatives of block clubs and individual property owners in the affected area, and those groups happened to be mostly white. He also says that the task force tried hard to gather a wide spectrum of opinions when drafting the proposal by holding four community meetings, which he says led to much more community involvement than usual–TIF regulations require that only one public meeting be held, and it doesn’t have to be until after the TIF proposal is complete.

The first meeting was held on May 22 at Loyola. RPCAN members thought there hadn’t been enough discussion of the issues that concerned them, so on June 11 they held their own meeting, which Tobin says was attended by more than 100 people.

O’Connor held another meeting on June 12, and Moore held two, on June 18 and 30. Moore says about 100 people of various races and ethnicities attended the meetings, and that at the June 18 meeting participants broke into small groups to discuss the TIF and offer suggestions for what they’d like to see. He says there was “a surprising consensus among folks on what they wanted,” until the meeting was “unfortunately marred by RPCAN’s sudden appearance on the scene,” whose members were “disruptive.” He says the suggestions that came out of the small groups will be part of the final TIF proposal: “There was significant participation from everyone in the neighborhood, and the final product reflects the values of everyone in the neighborhood. Renters were notified of all the meetings, and the redevelopment plans will address the concerns of renters, including affordable housing.”

Though they haven’t seen the final plan, many opponents remain skeptical. Audrey Avila, a senior at Loyola who rents in a private apartment in the neighborhood, says, “There’s a big difference between going to a community meeting and being an actual part of the task force.”

Tobin says that RPCAN’s basic position is that if there is a TIF it needs to meet certain standards. He says the group’s members want any TIF proposal to mandate oversight by a community board, to require businesses receiving funds from the TIF to pay workers a living wage, and to ensure that 30 percent of all residential developments would be affordable for people making between $25,280 and $38,000 a year.

Yet some RPCAN members who attended the meetings don’t want a TIF in any form, and they’re unhappy that the TIF was presented at the aldermen’s meetings as a done deal. “The public meetings basically showed that neither alderman had any interest in discussing whether there should be a TIF or not,” says Mark Pollock, an RPCAN member and associate professor of communications at Loyola whose family has lived in Rogers Park for four generations. “They said at the beginning of the meetings that they were in favor of it and the purpose was to find out about what people wanted to see the TIF used for. The process left a lot to be desired.”

During July, RPCAN hosted 12 informal meetings in people’s homes to explain how a TIF works and to discuss how to oppose a TIF–or how to ensure community involvement and affordable-housing protections if a TIF is instituted anyway.

O’Connor thinks much of the opposition is the result of long-standing hostility between RPCAN and Moore. He sees no reason not to set up a TIF. “If you’re in the process of building communities, why wouldn’t you use every tool you have available to you?” he says. “To me, the creation of a TIF is a foregone conclusion. It’s how you use it that matters. TIFs can include small-business improvement plans or loans to home owners. And we’ve had a fairly extensive community process–more so than most TIFs that exist.”

Proponents say they expect the TIF to be in place by the end of the year. Jones hopes that the final plan truly reflects the community’s needs and doesn’t leave the neighborhood bitter and divided. “We hope the community will demand participation,” he says, “and also demand a different approach in how the government assists in reshaping a neighborhood.”

Art accompanying story in printed newspaper (not available in this archive): photos/Dorothy Perry, Nathan Mandell.