TIFs go to Springfield

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Next Wednesday, Cook County Board commissioner Mike Quigley is taking his TIF act on the road, heading off to Springfield to address a private meeting of legislators, legislative aides, and gubernatorial advisers.

"I talked to the governor's office and they said, 'Leadership wants you to come to Springfield and talk about tax increment financing,'" says Quigley. "I assume that means the speaker [Michael Madigan], the senate president [Emil Jones] and the governor [Rod Blagojevich] will have people there. But I really don't know."

Quigley, who commissioned a report (PDF) critical of Mayor Daley's TIF program, is being intentionally circumspect about his role in the ongoing behind-the-scenes struggle between the state's most powerful elected officials. Here's what going on.

For the last several years Blagojevich has held his tongue while Daley and schools CEO Arne Duncan rip the state for not providing more money for Chicago's public schoools.

It hasn't been easy for Blagojevich to remain silent. As gubernatorial insiders have explained it to me, they're all for giving more money to Chicago's public schools, but they find it hard to call for more state funding knowing how CPS suckers the state for the money it already gets. It's complicated, as most TIF matters are, but the bottom line is that it's a schools scam: for roughly every property tax dollar the schools divert to the TIF districts, the state gives them about 70 cents in educational assistance. Effectively, Daley and Duncan are manipulating the state's goofy education-funding system to divert money intended for schoolchildren to TIF deals -- like the $58 million handout they're ready to give developers to build an 18-story tower on top of Union Station.

Up until now Blagojevich has stayed away from TIFs, allowing Daley to freely spend the money. But apparently this last session was the last straw. Not only did Daley not support Blagojevich's ill-fated business tax, he embarrassed the governor by sending Duncan and busloads of schoolchildren to Springfield to call for more state education funding.

As a result our governor has evidently decided to send Daley a message: Mess with me and I'll mess with your TIFs. Over the last few weeks Blago's aides have been contacting Quigley, no fan of the mayor's, to pick his brain on the TIF scam. Now they've quietly let everyone (particularly Daley aides) know that they're inviting Quigley to Springfield.

Among the many things that Quigley intends to talk about is the Central Loop TIF, a $100-million-dollar-year boondoggle that funds development in an area where developers don't need incentives. Created in 1983, it's supposed to expire this year. But Daley's been asking the state to extend it for another 12. According to statehouse sources, Daley and Madigan recently struck a deal on the TIF: Daley agreed to support Madigan's watered-down home owner's property tax exemption in exchange for the speaker's support for an extension.

Blagojevich has the power to cut off Daley's TIF slush fund. He could hold hearings on the program. He could oppose extending the Central Loop TIF. What's at stake for the mayor? The Olympics, for one thing. As folks in Springfield will tell you, Daley's looking to use the TIFs to pay for his games. If the state threatens to plug up his money pipeline, he'll have to figure some other way to pay for them.

Quigley says he understands there are larger issues at play. "I don't have any expectations about any of this," he says. "They asked me to talk about TIFs, and that's what I'll talk about."

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