Red Line transit TIF sets off debate on transportation funding

Did the City Council set a go-it-alone precedent that lets the state off the hook with Wednesday’s unanimous vote to authorize a tax-increment financing district in hopes of nailing down $1.1 billion in federal funds to modernize the CTA’s Red Line before President Barack Obama leaves office?

Civic Federation President Laurence Msall is concerned about that.

Msall acknowledged that the City Council had little choice but to fill the void created by the absence of a state capital bill that, for years, has provided the local match for transportation projects across the state.

But he warned that the 6-mile-long transit TIF that will rebuild four stations and more than a mile of tracks and create a Red-Purple bypass to alleviate congestion “changes the direction of how we fund public transit” in Illinois.

“We’re going to basically start using property taxes’ incremental growth in order to back up loans that we’re taking from the federal government,” Msall told the City Club of Chicago this week. “That is a creative solution to a problem that we have in terms of match for the CTA. But, it’s also pushing into more property taxes to fund areas of the government that have historically been subject of the gas tax, the sales tax and the state funds. . . .

“They can talk in Springfield that they’re against property taxes. But they’re driving the local governments into property taxes.”

Lincoln Park Ald. Michele Smith (43rd) is equally concerned about what she called the “open-ended nature” of the transit TIF that will stretch from North Avenue to Devon and include one-half mile on either side.

“It’s creating a precedent for how things get funded that shouldn’t be funded through TIF,” Smith said. “The Brown Line, the Red Line [South] and almost every transit project in the past has been funded by a combination of federal and state funding. Those are our tax dollars as well.

“This creates an economic burden for decades that limits our ability to raise money for other things.”

Mayor Rahm Emanuel denied that the transit TIF sets a dangerous precedent.

In fact, he argued just the opposite after signing the legislation and calling outgoing U.S. Transportation Secretary Anthony Foxx to let him know that Chicago had honored its commitment to provide the local match without a day to spare.

“I don’t think this lets Springfield off the hook,” the mayor said. “Washington is gonna be north of 50 percent of the resources. We’re gonna tap those. But in every other piece of our work, the state’s been part of it and they’re not gonna get off the hook on that.

“If anything, I think it will be a driver for them finally getting a transportation bill done that Chicago will benefit from.”

The mayor said he campaigned on a promise to modernize the CTA’s Red Line from Howard all the way to 95^th Street and that Wednesday’s vote was “another down payment on that.”

Finance Committee Chairman Edward Burke (14th) argued that the “very future of public transit in Chicago was at stake” with Wednesday’s unanimous vote.

CTA President Dorval Carter Jr. acknowledged that a transit TIF is also a possibility for bankrolling the Red Line extension from 95th Street all the way south to 130th.

That long-awaited project carries a $2.3 billion price tag. The CTA has set aside $75 million for planning and engineering to start the ball rolling.

But, that does not relieve the pressure for a capital bill in Springfield.

“I’ve got over $13 billion worth of unmet capital needs to get to a state of good repair,” Carter said. “There is no TIF in the world that is going to address all of my capital needs. And the need for a state program is going to exist, no matter what.”

Wednesday was the deadline for Chicago to demonstrate its commitment to provide the $622 million in local matching funds needed to access that so-called “core capacity grant.”

The mayor’s intention was always to try to seal the deal before the Jan. 20 inauguration because of the normal slowdown that takes place whenever there is a changing of the guard in Washington.

But City Council approval took on a bit more urgency after Donald Trump defeated Democrat Hillary Clinton, the mayor’s candidate for president.