Sign up for our newsletters Subscribe
Of all the half-truths, lies, and distortions streaming out of City Hall after the mayor called for tax increases totaling $158 million in the face of a $193 million budget shortfall, my current favorite comes from 36th Ward alderman William Banks.
"I've been in the City Council for 25 years and I've never voted for a property tax increase," he told reporter Fran Spielman. "I don't intend on voting for one now."
Banks wants the public to believe that he and his council allies are always taking a courageous stand against rising taxes for Chicago's beleaguered citizens. But, as he ought to know, this is not exactly true. The fact is that Banks and his councilmates have been routinely hiking property taxes over the last few years every time they create a new tax increment financing district.
What's the correlation between TIFs and property taxes? In a nutshell, a TIF freezes the amount the government can take in property taxes from a TIF district for up to 23 years. To compensate for the money they're not getting from the TIF districts, the city, county, schools, and parks have to raise tax rates. There are now over 150 TIF districts in the city -- with new ones proposed every month, soaking up well over $400 million a year in taxes.
Nobody really know how much these TIF districts add to the average taxpayer's bill. And nobody, except for a few academics, is looking into it. Certainly, not Mayor Daley, who pretends as though TIFs magically create new tax revenue out of thin air. It's important for city officials to perpetuate the myth that TIFs are free money because the less people know about TIFs the easier it is for the mayor (and his favorite aldermen) to spend them anyway they want. Actually, I'm starting to think Mayor Daley's fooled himself into believing that TIFs don't raise taxes. Why else would he so cavalierly propose something as wasteful as -- to pick just one recent example -- forking over $40 million to subsidize the merger of the Mercantile Exchange and Board of Trade.
I suppose it's OK for Alderman Banks and Mayor Daley to fall for their own disinformation -- obviously they make more than enough money to pay their tax bills. It's just a little harder for the rest of us schmoes to keep up.