Tax Increment Financing District Course Saturday

Tom Tresser offers the following:

“TIF 101” and how to organize around them – 11/11

How to figure out what a Tax Increment Financing (TIF) District will do.

It’s the graph that explains how Tax Increment Financing districts work. I added the EXTRA descriptions.

TIFs suck up property tax dollars and place them at the discretion of your mayor.

Those property tax dollars are then LOST to the local units of government that need them to operate.

How many TIFs are there in America?

No one knows.

We DO know there are over 1,200 TIF districts in Illinois and 148 in Chicago.

It’s a MULTI-BILLION DOLLAR scam that directly impacts all aspects of local government – but MOST especially – the operations of our public schools.

I’d like to invite you a “TIF 101” workshop aimed at educators and organizers.

We will meet on Saturday, November 11, from 10 am to 12:30 pm at the Loyola Law School in Chicago. Details and registration here. T

he cost is just $10.00 and attendees will be able to purchase copies of the book with $5 billion in answers – “Chicago Is Not Broke. Funding the City We Deserve” at half-price.

We will review the basics of how TIFs work and take a close look at their impacts across Chicago and Illinois.

We will share the insights gained by The TIF Illumination Project from seven years of research and from conducting 51 public meetings across the region in front of over 6,000 people.

This is a powerful issue that TURNS OUT people. It gets them energized. It gets them asking great questions.

And it gets people ready to be recruited into ongoing efforts around civic engagement, expanding public services and electoral politics.

I hope you can share this URL widely:


TIFs stand for

“Taking It From Schools”!


Tax Increment Financing District Course Saturday — 17 Comments

  1. TIFs are a bad deal for the property taxpayer.

    But quite lucrative for certain parasites…

    “The experience in Chicago is important.

    The city invested $1.6 billion in TIFs, even though $1.3 billion in economic development would have occurred anyway.

    So the bottom line is that the city invested $1.6 billion for $300 million in revenue growth.

    The upshot is that TIFs are diverting tax money that otherwise would have been used for government services.

    The NCBG study found, for instance, that the 36 TIF districts would cost Chicago public schools $632 million (based on development that would have occurred anyway) in property tax revenue, because the property tax rates are frozen for schools as well.

    This doesn’t merely mean that the schools get more money.

    If the economic growth occurs with TIFs, that attracts people to the area and thereby raises enrollments.

    In that case, the cost of teaching the new students will be borne by property owners outside the TIF districts.”

    excerpted from:

  2. Good luck getting any interest from school board members. D155 does not care how they get their $$.

    Large businesses are getting their assessments cut by half or more, does D155 want to get involved?

    Protest the huge loss of EAV?

    No they don’t, they’ll take it from the homeowners, like always.

  3. Attended the annual Cary TIF review meeting last week.

    I think I may have been the only elected official in attendance.

    The meeting started off poorly as I questioned why we were being presented with financial data and an audit report that was 18 months old.

    The rest of the meeting I spent asking questions with limited success.

    It’s way past time that the village terminate the two non-performing TIF districts.

  4. I’ve seen this chart many times and would add these overlays:

    1. Few ‘profitable’ TIFs are ended at year 23. The chart should expand to include the more likely 35 year TIF lifespan.

    2. The yellow triangular wedge ‘Incremental Assessed Value’ is correct in practice: that AV rise is taxed to send money to the TIF mayor.

    BUT it is misleading in that “Incremental Assessed Value” increase of property without TIF, even with NO DEVELOPMENT, would most likely rise over 23-35 years simply due to normal inflation.

    The normal inflationary assessed value is made UNAVAILABLE to taxation (by schools, etc.) specifically due to TIF.

  5. Another point:

    Property tax rate inflation engendered by the TIF District drives property values lower.

    Lower property values with similar/higher levies= HIGHER PROPERTY TAX RATES.

    higher property tax rates engender still lower property values…which cause still higher property tax rates…

    vicious negative feedback loop.

    BUT: here’s the kicker: TIF District payments are based each year upon the current PROPERTY TAX RATE…

    TIFs are REWARDED by being given MORE of taxpayer dollars because of higher tax RATES which were caused by TIFs!

  6. Another point:

    New 2017 School Funding Formula Law rewards LOWER EAV!

    There is an incentive to place an entire school district taxpaying community into a TIF to obtain more State funding.

  7. THANK YOU Paul Serwatka for having the moral courage and intellectual honesty to disintegrate the Lakewood TIF this year, saving Lakewood and Woodstock taxpayers from huge tax burdens in order to pay upfront profits for privately owned, predatory development projects.

  8. After a TIF is created, property taxing districts are still able to hike their extension from the previous year by a maximum of, the lesser of, CPI or 5%, regardless if the EAV in or out of the TIF district increases or decreases.

    Are TIF parcels hit with such a property taxing district extension hike, or just non TIF parcels?

  9. P-tax rate is extension divided by taxable EAV.
    Lower denminater =higher rate.

    The EAV stays unnaturally low without any TIF normal inflation included.

    The final (higher) tax rate is applied to incremental AV in TIF, and Treasurer gives that money separately to TIF municipality

  10. Mark, TIF parcels also get hit with any taxing body’s levy extension increases.

    The TIF Fund may receive the double benefit of an increase in EAV in excess of the Base TIF EAV, plus the benefit of a rate increase applied against the higher EAV.

  11. I’m wondering if TIF parcels pay more dollars as a result of a property taxing district extension dollar hike that is a result of the property taxing district taking the maximum of, the lesser of, CPI or 5%.

    Or if only non TIF parcels pay more dollars as a result of such a property taxing district extension dollar hike.

    Pretty sure the tax rate has no bearing on the ability of a property taxing district to extend such a dollar hike to parcels.

    The only two factors are CPI or 5%.

    Don’t think frozen EAV results in frozen property taxes for TIF parcels or frozen extensions for property taxing districts for those parcels, but not sure.

  12. The revenue from the taxing body’s levy extension increases that is attributed to the TIF parcels, goes to the TIF district (municipality) or to the property taxing district (for example, school district)?

  13. That would be the maximum of, the lesser of, CPI or 5% revenue.

    As opposed to the new growth revenue.

  14. The extension is set.

    Say it goes up, to accommodate new burden of TIF students.

    Extension is divided by taxable EVA to determine rate.

    Any incremental TIF increase AV is multiplied by rate, and given to municipality.

    TIF property owners may be given rebates, free land, or grants by municipality.

  15. Maybe Tom Tresser can develop a chart showing levy extension increases diverted from a taxing district to a TIF taxing district that are due to the taxing district levying for a maximum of, the lesser of, 3% or CPI.

    That is a little discussed component concept of a TIF taxing district receiving money due to increased AV or EAV.

    An important point being whether or not a taxing district levies for the maximum of, the lesser of, 3% or CPI, has nothing to do with AV or EAV (other than a sympathetic taxing district might eliminate or limit hikes on taxpayers whose property values are falling).

    The AV or EAV comes into play after the levy, during the extension process by the County Clerk.

    The county clerk could have more detailed reporting on the extension process.

    For instance, itemizing the amount diverted from each non tif district to each TIF district, and more documentation on how the process works from start to finish.

    Since it is not well documented to taxpayers there is a lot of confusion.


    The Tax Computation Report from the McHenry County Clerk sheds some light on the subject.

    The report lists the current EAV, base EAV, TIF Increment (difference between current and base), and Extension for each TIF district.

    The cumulative for all TIF districts for tax year 2016:

    current EAV – $116,174,650

    base EAV – $93,836,999

    TIF increment EAV – $22,337,651

    Extension – $3,032,539.


    That computes to $3,032,539 property taxes on a $22,337,651 increment EAV.

    If one ballparks EAV at 1/3 of full property value, the result is $3,032,539 property taxes on $67,012,953 property value, which is a 4.5% effective property tax rate.


    Under each non TIF taxing district the Tax Computation Report also lists the TIF increment EAV, but not the dollar amount diverted to TIF districts.

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