Medill Reports
October 14, 2009
City shells out $15 million in TIF money with no blight in sight
By Grant Slater

In the Loop, the Chicago Mercantile Exchange holds sway over the city's financial world.

To the first-time observer, the scene borders on mayhem. The chatter on the floor is all about when the Dow might bust through 10,000.

One moment breaks out of the din. A broker barks to no one in particular, "Commerce baby!"

Four miles from from that locus of commerce, C.L. White holds sway over Carroll Avenue between Homan and Kedzie avenues. His Joshua Missionary Baptist Church anchors the center of the block. The chatter there is all about whether Pastor White had found time for lunch as he cruised past neighbors and foreclosed homes.

One kid on the corner shouts, "You find some grub yet? It's 2, you know."

The two sites, separated by much more than physical distance, are both targets of tax increment financing in Chicago. But while one races on the adrenaline of capitalism, the other is lethargic, blighted and foreclosed.

This is the tale of two TIFs.

In White's Humboldt Park, "The old folks can't afford to keep their homes up," White said. "They bring new people in and the houses go to them."

In the Loop, the exchange will soon receive $15 million for renovations and a new media area for CEO interviews and business networks near the raucous trading floors of the Board of Trade. The money will be funneled from property taxes collected on commercial real estate in the West Loop.

This year, a temporary housing shelter with a branch on Carroll Avenue opened a new brick building around the corner with gleaming tin roofs and other green technologies the city requires. The center spent $300,000 to get another $1.2 million from the Chicago/Central Park TIF, said Arloa Sutter, executive director of Breakthrough Urban Ministries.

Still, the situation is dire. "The profile of people coming to us keeps getting more educated, more first-time homeless. They're coming from their cars," Sutter said.

Chicago's TIF districts sprang up in the 1980s to provide money for redevelopment in blighted areas in which property tax provided meager returns. But their mandate has since ballooned to include areas like downtown that are anything but blighted.

Julie Dworkin, policy director for the Chicago Coalition for the Homeless, said that city money like the $350 million sitting idle in TIF districts across the city is vital to building the affordable housing that Humboldt Park and other neighborhoods need.

The coalition, along with other groups, has called for a fixed rate of 20 percent of TIF money to be spent on affordable housing across the city.

"There's no policy that's already in place. There's no number," Dworkin said, but the city has spent 4 percent annually on affordable housing since 1995, according to a study by the Sweet Home Chicago Coalition.

Back in the Loop, the city official shepherding the renovation approval stepped up to the podium in City Hall to talk about the bottom line, jobs. She stressed that the complex trading of financial instruments ranging from weather futures to real estate derivatives employed – directly and indirectly – thousands.

The $15 million renovation is contingent on the exchange keeping those jobs in Chicago, in the Loop.

Four miles west, Pastor White drove down Carroll Avenue counting the board-ups.