Judge suggests OPRF and Oak Park resolve tax dispute out of court

OPRF, village have till March to decide their next move


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By Marty Stempniak

Staff Reporter

A Cook County judge recently told OPRF High School and Oak Park Village Hall they should resolve their long-running dispute outside of court — to save money on legal bills.

For almost a year, the village and the high school have been battling in front of a judge. At issue is how much money village hall owes the high school in a dispute over tax increment financing dollars. A source with the high school claims the amount could hit $40 million over the course of the next decade, while the village says that number should be far lower.

To date, the two sides — plus Elementary School District 97, which was added to the lawsuit last year — have amassed more than $100,000 in legal bills. Jan. 31, Judge Peter Flynn suggested the three sides resolve their differences in front of a mediator, rather than in a courtroom.

Village Attorney Ray Heise said he agrees with the suggestion. While a mediator would still cost the three sides money, it would be far cheaper than a long-lasting lawsuit, he said.

"It certainly is a much more economical manner for local government entities to resolve disputes," Heise said. "The taxpayers who fund each and every one of these entities also fund their litigation."

The three governmental bodies have until March 1 to submit a letter to Judge Flynn, saying whether they want to resolve the dispute through a mediator. The village already submitted its letter on Feb. 3. Heise wrote that Oak Park "wholeheartedly" supports Flynn's idea.

District 200 board member John Allen said Friday that the high school had not yet decided whether it was interested in hiring a mediator. The board planned to meet in a closed session on Feb. 8 to discuss its options.

"We'll take it seriously," he said. "We're not just going to rule it out of hand, but we're not going to just sign in to it, either, until we figure out what our position is."

Both Allen and District 200 board President Dietra Millard could not be reached for comment Tuesday morning after the meeting. Chief Financial Officer Cheryl Witham did not return a phone call late Monday, while board member Ralph Lee deferred comment to Millard and Allen.

Village officials also noted that Flynn, again, dismissed count II of the high school's lawsuit, which claimed that village hall violated the state's TIF act. Dist. 200 also has the option of filing a third amended complaint against the village. Allen was unsure as of Friday whether the high school would take that option.

Village Manager Tom Barwin said the three sides continue to meet behind closed doors trying to reach a settlement. He hopes the lawsuit will run its course soon.

"In light of the judge's ruling, sending this off to mediation, I think that's where it should go next," he said.

Village President David Pope agreed.

"Rather than wasting taxpayer money and the court's time, being able to sit down and resolve this is certainly in everyone's interest," he said. "We've been wanting to do that for a year."

Reader Comments

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Enuf is Enuf from Oak Park  

Posted: February 9th, 2011 4:58 PM

The $97M is just the start. Add $1.5M for sales tax increment. Add $91.9M and another $1.5 sales tax increment for the Madison TIF. Add $0.5M for the Har/Gar TIF. Sum total $192.4M. Now add the lost property and sales tax revenue for the 10 DTOP TIF properties the village acquired ($12.7 acq. cost), and the 5 properties in the Madison TIF ($4.2M acq. cost). Extrapolate all TIF costs to 2018. Now determine the ROI if the same TIF amount was invested incrementally since 1983 in alternative ways.

Dan Haley from Wednesday Journal  

Posted: February 9th, 2011 4:19 PM

Dear Ray, Admire you for jumping on and engaging with our commenters. Hope to see our commenters engage with you in a good discussion of a complex topic. The 500 character limit is hardwired into our software. But, Ray, if you want to go into more depth send us a longer response and we'll post it as an article and link it back to this thread for commenters to join in. Thanks Dan

Enuf is Enuf from Oak Park  

Posted: February 9th, 2011 4:16 PM

The 2009 DTOP TIF report states on p. 8 of the auditors report, '1.e. Land Held for Resale' (this page missing from the posted TIF report); "Land held for resale is valued at the lower of cost or market." There are 10 properties that comprise the $12.7M 'land held for resale' line item in the 2009 balance sheet. Since the $12.7M acquisition cost for these properties are pre-recession, their current market value would be much lower, but the 2009 TIF report does not reflect this as req'd. Why not?

OP Resident  

Posted: February 9th, 2011 4:02 PM

@Ray Johnson. Thanks for your prompt response. Sure glad I didn't bet the ranch. You'll get my vote!

Lost bet from Oak Park  

Posted: February 9th, 2011 3:25 PM

Damn it Ray, I bet the ranch on @OP Residents advice, that you wouldn't answer the question.

Ray Johnson from Oak Park  

Posted: February 9th, 2011 3:24 PM

@ Enuf: Great idea on posting the SB Friedman analysis -- I'll inquire about that. As for TIF reports -- we are required to follow the format and accounting principles provided by the state and I agree, its not always easy to find what you are looking for. We should enhance how these reports are provided. As I understand it, the value of land is the acquisition cost (not actual value which could be more or less than acquistion cost), but we are required to follow state reporting methods.

Ray Johnson from Oak Park  

Posted: February 9th, 2011 3:14 PM

@ OP Resident: On page 50 of the TIF report (link provided in an earlier post), you will find the the total amount collected is $97,028,426. It's impossible to have a detailed conversation on TIFs within the 500 character max here, so call or write with your questions -- nothing to hide and if I don't know the answer, I'll try to find out. rjohnson@oak-park.us or 708.358.5788 Thanks!

OP Resident  

Posted: February 9th, 2011 2:15 PM

Same old song from Ray Johnson. Ask him a specific question about TIF revenues & expenditures & you'll get no answer. Either he doesn't have a clue or believes that Oak Park taxpayers are not entitled to a straight answer. Here's an easy one for Ray. "What is the total amount of tax dollars placed into the Downtown TIF Fund since it was established?" You can bet the ranch he's not going to share that information. Maybe if we elect someone not linked to the VMA machine, we'll learn the truth

Enuf is Enuf from Oak Park  

Posted: February 9th, 2011 12:09 PM

The 2009 TIF Report that I received via the TIF Registry misarranged sections, but I see now that Section 3.3 lists $21.3M of DTOP TIF debt obligations. Since the primary DTOP TIF asset is "Land held for resale" at $12.7M (valued at the lower of cost or market), which is the same amount as reported in 2007, I am concerned the $12.7M does not reflect actual market value, and therefore understates the current $21.3M deficit. Posting the recent SB Friedman TIF analysis would provide clarification.

Ray Johnson from Oak Park  

Posted: February 9th, 2011 10:02 AM

On a serious note -- anyone can sign up as an 'interested party' to receive information on each of the three Oak Park TIFs. You will receive notice of the annual TIF Joint Review Board meetings and corresponding financial reports. To request being added to the 'interested party' list, please provide your name, address, phone number and email address to: Clerk@oak-park.us I am inquiring now on the question regarding the debt obligation previously posted and will advise.

Ray Johnson from Oak Park  

Posted: February 9th, 2011 9:59 AM

And in the 1951 classic the Cheshire Cat is quoted as saying: "Most unpleasant metaphor. Please avoid it in the future." ;-)

Enuf is Enuf from Oak Park  

Posted: February 9th, 2011 9:03 AM

Trustee Ray (Cheshire Cat) Johnson is grinning widely again. While the 2009 Annual TIF report is posted (albeit late), there simply is not enough info to render a comprehensive assessment. For example, fund reserves for "land held for resale" and "TIF projects" are w/o itemization or substantiation, nor are they referenced to current TIF Plans. The $21.3M in 2008 DTOP debt obligations (bonds) have magically disappeared w/o explanation. C'mon RJ, we need fiscal oversight, not spin and grins.

OP Resident  

Posted: February 8th, 2011 3:25 PM

Let's start at the very beginning. A very good place to start. OP-RF High School requested that the Village of Oak Park permit an inspection of the TIF books. Village Manager Barwin answered, "No!". Why not? That's never been explained by President David Pope or Trustee Ray Johnson. They've circled the wagons. Nobody sees the TIF books except them. I suspect that Village Hall does not want to reveal to anyone how the fund has been mismanaged or the amount of money they have misspent and wasted

chet21 from Oak Park  

Posted: February 8th, 2011 1:10 PM

uh huh, I am COMPLETELY empathetic with "RF taxpayers" - which is why I want OPRF board to NOT increase tax haul from RF TIF (which would help RF & OP taxpayers) and then do the same when OP TIF expires (which would help RF and OP taxpayers). They won't though. BTW, why aren't they suing RF for questionable usage of millions for "one day?" developer at RF Commons? Isn't this usage by RF just as questionable as what OP is doing? OPRF is in "fat city" and getting fatter - while the rest of us...?

uh huh  

Posted: February 8th, 2011 12:53 PM

@chet, OPRF is suing because VOP refuses to honor their agreement. What most people forget is that the taxing bodies are not coincident, and by suing VOP for the money they owe them, OPRF is sticking up for their RF tax payers who are being ripped off by OP. If OP tax payers feel that their taxes are not being used properly in a law suit, they should tell that to the VOP Board.

OP Resident  

Posted: February 8th, 2011 12:30 PM

Sounds like Ray Johnson has got the facts. Will he share the info I asked about in my post and provide the total amount generated by the Downtown Oak Park TIF? I've heard the figure is well in excess of $100 mil.That means the local taxing bodies have split about $25 mil. To his credit, Johnson is willing to engage in the discussion but rarely will address specific inquiries. I think more of the community would be supportive of the Village's position if officals were open to full disclosure.

Ray Johnson from Oak Park, IL  

Posted: February 8th, 2011 12:20 PM

Anyone interested in reviewing various financial reports on the VOP budget, annual TIF reports or independent audits can visit this link: http://www.oak-park.us/Finance/index.html Anyone intersted in reviewing the 2009 annual TIF report, which includes expenditures and a list of vendors, can visit this link: http://www.oak-park.us/public/pdfs/Budget_Finance/TIF Annual Reports/TIF 2009.pdf

chet21 from Oak Park  

Posted: February 8th, 2011 9:48 AM

Can't dispute that VOP should open up books. I CAN, though, question why OPRF is using MY tax dollars to sue VOP on this matter-which is AGAIN "using MY tax dollars" to defend itself. OPRF has a surplus exceeding $75M and is about to get the RF TIF and eventually OP TIF. STOP!!! Do NOT increase surplus with RF TIF or OP TIF. Stop gouging taxpayers! Reduce tax rate - NOW & stop exorbitant spending/salary/contract increases!

OP Resident  

Posted: February 8th, 2011 8:55 AM

Will the mediator be allowed to examine the TIF books? Will the Village reveal exactly how much money the Downtown Oak Park TIF district has generated since it was established? According David Pope, 25% of the dollars collected have been distributed to local taxing bodies. Is he able to provide a grand total-to-date? Is it a fact that a significant amount of the TIF funds cannot be accounted for and have been written off the books? Who knows?


Posted: February 7th, 2011 12:41 PM

Of course the Village is jumping at the chance to use a mediator. They know they cannot win on merit, and are hoping that a mediator will simply cut the cake in half.

Oh yeah, I said it  

Posted: February 7th, 2011 12:22 PM

Here's a radical idea: How about the Village stick by the agreements it makes instead of trying to rip off all the other taxing districts just so it can shovel more money to their favorite wealthy developers?

chet21 from Oak Park  

Posted: February 5th, 2011 8:57 PM

Here's my suggestion to the OPRFHS Board: MEDIATE!!! Next? When the RF TIF comes back to taxpayers - drop your rate by similar amount. Next? When the OP TIF returns - do the same. You have a ton of our money in surplus - stop bleeding the taxpayers of OP and RF!!!


Posted: February 5th, 2011 8:03 PM

Why even NEED a mediator at ANY cost? Are we talking about professional, respectful, adults with a common purpose? I think this should and CAN be handled between the parties saving the TAX PAYERS money!

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