Discussion about the proposed tax-increment financing district in the City’s Fifth Ward continued Sept. 29 at the City-Schools Liaison Committee meeting. Two days earlier, at the request of two School District 65 Board members, City Council voted to delay a vote on the TIF until Oct. 25 so the parties could work out an intergovernmental agreement (IGA).
The City has had several IGAs with one or both school districts over the years, but these have been negotiated after a TIF was in place. Council members, by a 5-4 vote on Sept. 27, decided that negotiating an IGA took precedence over the TIF vote.
Synopsis of the TIF
On June 3 of this year, the CFOs of both School Districts were among the members of the Joint Review Board, which voted unanimously to approve the creation of the TIF district. All but one of the 284 tax parcels in the proposed TIF, the City’s ninth, are in the City’s Fifth Ward.
Because of its location in Evanston’s historically Black area, the TIF was named the Five-Fifths TIF – an allusion to the constitutional abasement of enslaved Black people and an implied promise that this TIF would help repair some of the damage of discrimination. Hearing that some Black residents were offended by the name, City officials have suggested they call it “TIF No. 9.”
Talk about a TIF district in this area began more than a decade ago, when Delores Holmes was alderman of the Fifth Ward. Robin Rue Simmons, who succeeded her, promoted the idea of the TIF and secured City Council approval. Current Fifth Ward Council member Bobby Burns has strongly supported the proposed TIF.
Back-and-forth: IGA and a resolution
Since July, the parties have been working to craft an IGA that would incorporate the concerns and the responsibilities of each side.
Among the sticking points in the current negotiations are the respective obligations of the parties and whether an IGA is the appropriate vehicle to address some of the concerns.
In early August, the School District sent a proposed IGA to the City that, among other things, reportedly required the City to protect Black residents in the Fifth Ward from being displaced.
The City did not disagree that it was necessary to protect Black residents from displacement, Burns said, but an IGA was not the mechanism to do so. The City rejected the proposed IGA altogether, City officials said, because it was unilateral, proposing obligations only on the City and no commitments by the District.
In late August, the City instead proposed a resolution that City officials said they believed took into account most of the District’s concerns: using TIF funds for such things as affordable housing, repair to private homes and workforce development.
The District rejected the resolution, saying it was “unenforceable.” City resolutions are nonbinding.
City comments on the District’s Sept. 22 IGA
At the Sept. 29 meeting, District 65 Board Vice President Elisabeth Lindsay-Ryan referred to a recent draft of an IGA.
“We asked [the City] for an IGA, but we didn’t get one. So we drafted one last week. And that’s the one that we are negotiating based on, which is rooted in the content of the conversation that we did have.”
She added, “All of our lawyers that negotiate these things [will] respect [that] we had meetings previously, without legal precedent.” She said the District “thought we had agreements” but the City’s Law Department appeared to disagree.
Yet, she said, “I think we can work things out. I’m hopeful that we all have shared the same commitment to protect residents of the Fifth Ward against gentrification.”
The RoundTable obtained a “redlined” copy – a copy with track changes and comments – of a proposed IGA sent by the District on Sept. 22. Corporation Counsel Nicholas Cummings struck several provisions and added comments explaining his reasoning.
Cummings noted that many of the provisions relating to the City’s commitments contain the word “shall,” whereas few of the District’s proposed commitments are similarly mandatory. He stuck several proposed provisions and explained why certain provisions were not workable from the City’s viewpoint or from a legal standpoint or both.
In an overall comment to the proposal, Cummings wrote, “The City’s commitments will match those in the resolution [brought to City Council].”
The District’s proposed IGA contains some provisions that relate to a new school in the Fifth Ward. Those provisions and Cummings’s comments follow.
The District proposed: “Assist in Locating a Site for Fifth Ward School: If requested by the School District, the City shall assist the School District in locating and acquiring appropriate property, including using incremental property taxes in the TIF fund or in the Fifth Ward for a development of a neighborhood school.”
Corporation Counsel Cummings wrote in response: “It is the City’s understanding that District 65 already owns land (Foster Field) and has publically committed to use that land to build a school.”
The District proposed: “Fifth Ward School. If suitable land is identified and can be acquired by the School District, the School District shall establish a school within the TIF District or the Fifth Ward without a referendum to the extent permitted by law within ten years.”
Cummings wrote in response: “The District already has land in the form of Foster Field. The effort extended should not be ‘good faith efforts;’ it should match the verbal commitments made by District officials.”
The District proposed: “MWBE [Minority/Women-owned business enterprise] Contractors: Should the School District acquire property in the TIF District of the Fifth Ward to construct a school, the School District shall implement goals substantially similar to the City’s current goals regarding contracting with minority and women business enterprises related to the construction of the school to the extent permitted by law.”
Cummings wrote in response: “Use of MWBE or EBE [Evanston-based enterprise] contractors should go beyond the construction of the school; the City would like this to be District wide, including purchasing and procurement, workforce development, contracting and construction. The City has similar commitments and asks the District to make similar commitments.”
Cummings noted objections to other proposals, some of which are not permitted under TIF law and others that do not adhere to TIF regulations.
As examples, he notes the District’s definition of “affordable housing” is “too restrictive” and questions whether the District in fact knows what it is proposing.
The proposal to use TIF funds to abate property taxes in the TIF is not allowed. A proposed income level for affordable housing units must comply with State TIF law, Cummings notes in another proposal, because the statute “specifies the affordability levels we can spend TIF dollars with respect to new construction in the district.”
The parties will continue negotiations, with an apparent agreement to have a mutually acceptable draft ready for Council approval on Oct. 25. One Council member at the Sept. 27 meeting said he was putting the District “on notice” that the TIF was ready to be approved. He warned that District officials should not “drag their feet” past Oct. 25.
Amazing that the City is even entertaining these silly demands from the District. And it is telling that the District doesn’t want to put a new school referendum on the ballot. They undoubtedly understand there is no appetite for incurring more debt for a new school while the district is shrinking in the number of students.
The only way they can avoid a referendum is to finance a new school on the cheap which they appear to want to do by having the TIF pay for it.
TIFs have been wildly successful in reinvigorating Evanston from what it was in the early 1990s. Luckily any “agreement” the city negotiates with the District is strictly non-binding, so they are committed to anything.
This School Board is off the rails. You have teachers picketing because they don’t think the Board and admin are paying enough attention to safety. When you see this nonsense, it is clear they have a point.