Some south suburban residents are fighting back against high property taxes, cushy breaks for developers and shady deals that allow public funds to benefit private interests.
They want to help people better understand tax increment financing districts, or TIFs. Members of the group Save Our Southland have enlisted taxpayer advocate Tom Tresser to help shed light on projects in Homewood, Matteson and elsewhere.
“We want people to understand how their money is being used and abused,” Tresser said Thursday during a video conference call with three group members.
Tresser was invited by Gina Davis-Mireles and Lynne Farmer of Park Forest and Constance Means of Olympia Fields. Their group has sought to engage other residents and taxpayers since 2019, when the Rich Township High School District 227 Board voted to close Rich East High School in Park Forest.
Their concerns apply to all residents and business owners who pay property taxes. They learned of Tresser after he delivered a presentation about TIFs in February to a group of residents fighting plans to turn Homewood’s 130-acre Calumet Country Club into a logistics park.
“I’m pretty good at explaining how TIFs work,” Tresser said.
Tresser said he launched the TIF Illumination Project in 2013 because of Chicago’s bid to host the 2016 Olympics. Chicago’s Olympic bid ended in 2009. Tresser opposed the bid, he said, because his research showed that Olympic host cities lose a lot of taxpayer money while a few people get rich.
Tresser said he did something no one else had done at that point. He obtained the annual reports for all of Chicago’s TIF districts. There were 164 at the time, he said. He found $1.7 billion combined in Chicago’s TIF funds.
He wrote a book, “Chicago Is Not Broke,” about how the city had ample taxpayer funding at its disposal. He founded the organization CivicLab, which promotes democracy and transparency. The group has presented information about TIFs at more than 170 public meetings, including Homewood, he said.
“We characterize TIFs as a slush fund controlled by the local mayor,” Tresser said.
TIFs siphon property tax dollars that otherwise would be used to help fund public education and other services, he said.
“Public schools are always the No. 1 item being robbed by TIFs,” Tresser said.
Tresser highlighted key points as he breezed through an example of a typical TIF presentation he would deliver at a public meeting. Mayors control TIF funds because city councils and village boards typically rubber stamp everything, he said.
He walked through a brief history of TIFs. Illinois lawmakers approved the Tax Increment Allocation Redevelopment Act in 1977. The intent was to create incentives by spending tax dollars on public improvements that would complement private investment in blighted areas.
Tresser and his associates obtain public records through the Freedom of Information Act every year to track TIF funding, he said.
“We show how TIFs have grown in Illinois since they came here decades ago,” Tresser said. “Twenty-two billion dollars has been taken off the table across the state.”
When towns create TIFs, they establish a baseline of tax payments by properties within the boundaries of the district. The typical TIF lasts 23 years, though it may be extended. Many communities have multiple TIFs. Tresser said his researched showed there are 1,304 TIFs in 559 municipalities across Illinois. Other states also have TIFs.
“This is not a Chicago thing, this is a national thing,” he said. “Across the country, we estimate there may be as many as 20,000 TIF districts stealing $40 billion in property taxes every year.”
Property owners in a TIF district pay the base amount in taxes for schools and other services. Schools and other taxing bodies receive the flat base amount for 23 years, even though improvements, inflation, appreciation and other factors typically drive up values and increase tax payments during that time.
Tresser explains to groups how taxes on the increased value are the increment and how those funds are diverted into TIF accounts controlled by a municipality instead of going to schools, parks, libraries and other units of government.
“We do that so people understand these are property tax dollars generated from the properties inside the TIF and this happens every year for 23 years,” he said.
This issue is that TIF districts can be relatively small in relation to the size of a community. TIF dollars are typically restricted to improvements within the district. That can include acquiring land or building new streets, water and sewer lines and other infrastructure.
The problem is that wealth remains concentrated in certain areas, even though less affluent parts of a community may be in greater need of investment, Tresser said.
“This is a strange way to do city planning,” he said. “What we see in Chicago and across the country is that developers drive the entire planning process for their region.”
Tresser said his goal is to help people determine when is it appropriate to give public money to private businesses, and what is meant by economic development.
Certain developers and businesses often benefit from TIF districts at the expense of others, he said.
“It kind of perverts capitalism,” he said. “In that, if you are a capitalist, you believe the market rules, so if you build something, you take a chance, you sell your product, you pay your employees, you pay your taxes. If you make a bad decision, you go bust.”
Those who benefit from TIFs create competitive disadvantages for others, he said.
“What has happened across America is that projects that are subsidized actually don’t have enough merit and they fail over time,” he said. “There were too many in the region, but it was too tempting to build another one because the guy got $5 million.”
Tresser said taxpayers should be leery of public-private partnerships in which municipalities or other government bodies funnel tax money to development corporations. Such entities may not be subject to laws that apply to public agencies, he said.
“They may not be amenable to FOIAs,” he said. “To me, that’s a warning sign. They’re not accountable. I think that’s dangerous.”
Thursday’s hourlong chat with Tresser was my second conversation with Davis-Mireles, Farmer and Means in a week. On another occasion, we gathered via video conference and they explained their mission to educate people in communities throughout the Southland.
“There’s all this secret money,” Means said. “We pay the highest property taxes in the nation out here. Homes are depreciating rather than appreciating.”
Farmer expressed a view shared by many about the complicated tax incentive tools.
“TIFs are a hard thing to wrap your brain around,” she said.
They said they plan to hold community meetings, first in Rich Township, then in other towns throughout the south suburbs.
“The more information that grassroots groups can get out there, we will have less of these situations,” Means said.
Ted Slowik is a columnist for the Daily Southtown.
