And so we are left with a zombie TIF. It lives. For another seven years or so. But it lives only to fulfill certain proscribed functions. And none of those functions have to do with creating economic development in Oak Park, the fundamental purpose of having a Tax Increment Financing district in the first place.
Practically, the TIF agreement approved last week by the three parties to end a long and expensive legal wrangle — Oak Park’s village government, the District 97 elementary schools and the instigator of the suit, Oak Park and River Forest High School District 200 — extinguishes both the lawsuit and the TIF.
After all the anguish and all the cost, spokesmen for the three parties maintained last week that the conclusion to this mess came not on any legal grounds but on shifts in how the county assesses property taxes which made the TIF financially incapable of meeting its long-time obligations.
It is always good to blame the county. Todd Stroger killed the TIF!
In truth, we understand the argument that reduced taxing rates from the county on commercial properties made the TIF ultimately untenable. However, the flaws in the TIF are homegrown. All the parties involved in the 2003 agreement to continue the TIF beyond its initial lifespan outsmarted themselves and us with a concept that was too cute by half and an agreement that was too complex to be interpreted readily. It is notable that virtually no one who crafted the agreement or voted on the agreement still serves in the same capacity.
The TIF “carve out” plan was presented as a work of governmental genius that would both allow development incentives to continue to flow, and for other taxing bodies, mainly the two school districts, to improve their cash flow sooner. And it would have worked if everything had worked perfectly.
Guess what? Things didn’t work perfectly. Local politics got nasty around the nexus of development. Projects like the Whiteco apartment complex were delayed for years in the bickering. Other projects and developers were scuttled amid the fighting. Combined, all the delays meant there wasn’t much to carve out of the TIF, there wasn’t much in new revenue to use to pay off the schools as pledged, and then the economy tanked and all development ceased.
Acrimony rose as the actual agreement proved baffling to interpret and the misguided lawsuit followed, swallowing almost $700,000 in legal fees, and polluting the waters of collaboration.
There is blame to go around. The village has not been as transparent as the law and good sense called for in its dealing with its TIF partners. Some poor choices were made by the village, along with some savvy ones, in assembling parcels for development. The high school was unnecessarily antagonistic in pressing its case. D97 has played this tangle with the most grace and comes out with the fewest scars.
The agreement, as approved, resolves several immediate issues. The existing TIF debts will get paid. The Special Service Area taxing district in downtown Oak Park remains financially whole. D97 is positioned to continue receiving its full share of state aid through the close of the TIF in 2018. And village hall still has the ability to replace its aging public garage at the corner of Lake and Forest.
The reality though is that as all other funds collected by the TIF are passed directly through to the taxing bodies, the zombie TIF eliminates a valuable tool in fostering new development in the village. As imperfect as this TIF has been, that is simply a loss for all of us.