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Evanston City Council members now have the pieces in place to pass the newest tax-increment financing (TIF) district for the City.

Council members solidly backed the introduction of ordinances at their Sept. 13 meeting related to creation of the Five-Fifths Project TIF – the City’s ninth – despite strong criticism of the proposal leveled from some sectors of the community.

In a TIF district, the tax increment – the difference between the property tax revenues in the district as the land went into the TIF (the base) and as improved – is placed in a fund that can be used to pay for certain infrastructure projects and other uses within the TIF. That increment remains in the fund for the life of the TIF, typically 23 years. During that period, the taxing bodies affected by the TIF receive their share of only the base property tax revenues.

One step in the TIF process is that representatives of all taxing bodies affected by the proposed TIF, meeting as a Joint Review Board, must approve the TIF. In June, the members of the Joint Review Board unanimously approved the creation of this TIF.

Council comments

“I generally do not support TIFs as a tool for economic development,” said Council member Devon Reid, 8th Ward, one of those voting in favor. He said, “If there was a TIF to meet the goals that are laid out in a State statute, I’d say that this TIF has the potential to do that. I would have opposed almost every TIF that has come before this Council almost every time. But this is one of the things makes quite a bit of sense.”

Council member Melissa Wynne, 3rd Ward, spoke of the City’s judicious use of TIFs.

“I think TIFs have a very bad reputation, partly because of how badly Chicago has used TIFs,” she said. “And unfortunately, that has left a stain on TIFs, whereas in Evanston we have used them very strategically and to our greatest advantage over and over again.”

But Ninth Ward Council member Cicely Fleming voiced reservations. Fleming and Council members Clare Kelly, 1st Ward, and Thomas Suffredin, 6th Ward, voted against the proposal, which moved forward on a 6-3 vote.

Partial map of proposed Five-Fifths TIF (from City of Evanston materials)

“A lot of what we’re going for in this TIF is about selling the Civic Center,” Fleming said. “And I can tell you, I’m not wedded to this building at all, I’m not pro-selling, pro-keeping it. It would just depend on the numbers for me. However, we know this community has a lot of opinions about this building.

“And while I know we will have a very lengthy dialogue about what we’re going to do with this building, we are also moving forward with this TIF and setting it up so that if we sell the building, we can receive the increment, which is good financial planning. But we’re also putting a little bit of the cart before the horse and then telling people, ‘We’re not selling something’ – a huge process – and we sell it. However, we’re ready to sell it with this step.”

Kelly expressed concern that “there’s a lot that’s very unclear” with the proposals.

“There’s a lot of what I feel, there might be some lofty goals, but there’s nothing you know – the real concreteness of it is lacking.”

Further, not all the City’s TIFs have been successful, she suggested, pointing to the Howard-Hartrey development in Reid’s ward.

However, that TIF, which was created in 1992, more than doubled its equalized assessed valuation, from $8.4 million to $20.5 million. When it was retired in 2016, a surplus of nearly $650,000 was distributed among the taxing bodies.

Kelly also spoke of the “resounding opposition” the City has encountered in the process.

“And that has to be taken seriously and considered,” she said. “And what I’m hearing is ‘We did the outreach; we do the outreach.’ But I feel like the residents, their voices and concerns are not being reflected as we move forward.”

Bobby Burns, the Council member for the Fifth Ward where the proposed TIF would be, noted that the TIF had been constructed in such a way to resolve concerns.

“What I can say is I can name every single person that has stated opposition, and I can show you in the TIF where we’ve included their concerns,” he said. 

The proposal, Burns said, “clearly states [it is] to support the small to mid-sized landlord, naturally occurring affordable housing. …

“I can point to every single concern that we’ve heard, I’ve been able to get that from town hall meetings that we’ve held here at the City, [meetings] that I’ve held separately, one-on-one sessions, group meetings. We’ve had meetings around this as much as we can. At this point they’d like me to say I don’t agree with the TIF, [but] I do,” he added.

TIF details

The area in the proposed TIF district meanders from the Morton Civic Center, minus adjacent Ingraham Park, to the new high-rise at Emerson Street and Green Bay Road, north to Central Street and west to include Fleetwood-Jourdain Community Center, Foster Field, the Weissbourd-Holmes Family Focus building and surrounding properties – in all, 284 tax parcels.

The proposed TIF is to provide “a dedicated funding source for a number of economic development initiatives long sought in the Fifth Ward, but not provided at a sustainable level by the private market,” said Paul Zalmezak, the City’s Economic Development Manager, in a memo to Council members.

“Much of the proposed TIF district encompasses residential property and small business districts anchored by independent businesses, many of which are Black-owned,” he wrote. 

“This TIF is unique in nature as it is designed to explicitly support homeowners and existing landlords maintain and improve existing residential property to help maintain culture, community, and independent minority-owned businesses.”

Staff is proposing that TIF funding be used “strategically and narrowly,” he said, including the areas of residential repairs and improvements, affordable housing and workforce development.

District 65 objections

Although representatives from both school districts, 65 and 202, were among those voting to approve the TIF, the City may consider a separate agreement with one or both school districts.

One TIF-related proposal did not move forward at the Sept. 13 meeting, as Council members held over until Sept. 20 a resolution that describes in general how TIF funds would be spent. At an earlier meeting, Burns and Zalmezak said the resolution reflected input from the school districts.

District 65 Board members Donna Wang Su and Joseph Hailpern addressed Council members about the issue during the public comment portion of the meeting, presenting a letter from District 65 Board President Anya Tanyavutti. 

The resolution “should not be viewed as encapsulating the Board support for the TIF,” the letter said.

“While the resolution contains laudable goals related to the TIF and includes many of the concerns the District has raised with City staff, it does not contain enforceable commitments,” it said.

The letter also stated, “The District had specifically requested that the City and the District enter into an intergovernmental agreement related to the TIF. Those discussions began over six weeks ago. The City, however, unilaterally determined that a resolution was more appropriate to address the District’s concerns and provided this proposed course of action with very little time for the District to react.

“If the intent of the Resolution is to meet the District’s concerns, it does not, and we ask that it be pulled from the agenda. If the City decides to move forward with the Resolution, we ask that the paragraph that refers to discussions with School District 65 be removed from the final Resolution, as its inclusion implies District 65 support for the TIF.

 “Should the City Council approve the first reading of the TIF ordinances tonight, the Board will seek to continue good faith discussions with the City in the hope of reaching an agreement regarding the TIF to ensure that the City’s goals contained in the resolution are in fact commitments and District 65 interests are considered.” 

Reportedly, the District had asked for a commitment from the City to protect the Black residents of the Fifth Ward from being displaced. Burns, responding to a question about that at a Sept. 9 meeting, said an intergovernmental agreement alone would not protect Black people in the ward. Further, an intergovernmental agreement must be mutual and unilateral – both the City and the School District would have to give something.

The resolution that Council will consider Sept. 20 also contains a commitment that no TIF funds would be used for a Fifth Ward school, something Burns said District 65 officials had requested. 

Burns said the City is open to an Intergovernmental agreement (IGA).

“I know for sure City staff recommended an IGA, maybe in agreement with some of the other members of the [Joint Review Board], but we recommended it. And so we’re supportive of it, if there’s consideration on both ends.”

The special City Council meeting at which the TIF resolution will be considered is scheduled for 5:30 p.m. Monday, Sept. 20.

 

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  1. Councilmember Burns’s objection to the IGA requested by District 65 is misplaced. The school districts ARE giving something from their side–they’re agreeing to forgo their share of any increased taxes generated by the properties included in the TIF, during the 23-year life of the TIF. That’s a huge amount, especially when you consider the enormous increase in the tax base that’s likely to occur if the Civic Center or other City properties are sold.