Where our tax money goes - and notice it's not to TAFT High School or the Chicago Police Department

While you were distracted by NATO ...

Mayor Emanuel doles out TIF and charter money—and cuts cops and libraries

By Ben Joravsky@joravben

A crowd of war protesters not thinking big picture, like Mayor Emanuel

Marc Monaghan

While you were distracted by all the NATO nonsense that's been consuming our city for the last few weeks, Mayor Rahm Emanuel has been on the move as usual.

He resigned to become general manager of the Cubs.
Alas—just wishful thinking.

Actually, he and his minions have been busy. That is, they've been giving your money to rich insiders while cutting back on the services you get in return.

Let's start with the corporate handouts. Emanuel turned over $29.5 million in desperately needed property tax dollars to a consortium of wealthy investors who clearly don't need the money. In the mayor's defense, it wasn't his idea. He was dusting off a bad one left over from his Mayor Richard Daley.
Specifically, it was a deal in which the city will take $29.5 million in tax increment financing funds from the LaSalle Central TIF district—a boondoggle to begin with—and use it to help build River Point, a 45-story office high-rise at Lake and Canal on the banks of the Chicago River.
Despite the commitment of TIF money, River Point, originally proposed by developers Hines Interests and Larry Levy, never got built because some of the prospective tenants decided not to sign leases.
Now River Point's back to life because Ivanhoe Cambridge—which, as the mayor proudly notes, is one of the ten largest real estate firms in the universe—decided to kick in some money even without preconstruction leases.
In exchange for that $29.5, the public's getting a 1.5-acre park. Not the kind of park where you throw Frisbees or play soccer or run around a track—more like a river walk with trees and grass.
There's so much wrong with this deal, it's hard to know where to begin. Let's start with the fact that TIFs are supposed to be reserved for the poorest of poor communities, and the West Loop definitely isn't one of them. Then there's the involvement of Ivanhoe, which, as one of the world's largest real estate firms, should be able to finance its own deals.
Also, while I love river walks, there are many more pressing recreational needs in Englewood, Roseland, and other low-income communities beset by gun violence and gangbanging.
Perhaps worst of all, the resulting bump in property tax revenues will go back into the TIF account—and not to the schools or parks.

So what exactly do we, the people, get for our $29.5 million? Oh yeah, the aforementioned park. But in reality, the park largely benefits the developers, because it enhances the value of their property. Chicago's taxpayers have no idea they're being so generous.
At the moment, the site's a big vacant lot with a railroad track that the park will eventually cover. I think we'll all agree it's far more lucrative to market office space that overlooks trees and grass instead of railroad tracks. So in all likelihood, the developers needed to cover up the railroad tracks anyway. In other words, the city's using your tax dollars to lower their construction costs.
It's not as though there's a dying need for office space in the Loop. The developers point out they're still trying to bring in tenants. As Ryan Ori writes for Crain's Chicago Business, it's what's called a "spec building," in which there aren't any preconstruction leases.
By subsidizing the overall cost of constructing River Point, the city enables the developers to lower their rents in order to lure tenants from other buildings. In essence, the city's taking your tax dollars away from schools, parks, and essential services and turning them over to one of the world's largest real estate companies so they can steal, I mean, lure tenants from other downtown office buildings.
And it's all happening in sweet home Chicago, the intellectual hometown of Milton Friedman, the Chicago Mercantile Exchange, and other laissez-faire capitalists who believe in a free market unfettered by government interference . . . unless, of course, the government's fettering interference comes on their behalf.

That's not all you might have missed while watching the NATO protests and press announcements. As Mayor Emanuel was talking up the River Point deal, his General Assembly minions were helping continue the privatization of the Chicago Public Schools by proposing to divert tens of millions of public dollars to charter school operators—many of whom rank among the mayor's closest allies, including Juan Rangel of the United Neighborhood Organization and Bruce Rauner of Noble Street. Hey, it's all part of the reform agenda at City Hall.

The vehicle is House Bill 4277, sponsored by state rep Daniel Burke, younger brother of Alderman Ed Burke. In essence, Burke's bill would hike the annual per-pupil allowance each charter school gets in public money, while providing no new money to the system as a whole. Since the public school system is already $600 million to $700 million in the red, diverting more money to the charters could force it to close regular schools, slash salaries, or fire unionized teachers. Which, come to think about it, may be the unspoken but underlying idea behind HB 4277 in the first place.
Don't forget—there's no credible evidence that charters do any better at educating students than public schools. Often, they do worse.

So the practical effect of replacing public schools with charters is not to benefit large numbers of students, but to create a workforce of teachers that's paid less. And that leaves more public money for . . . you guessed it—the charter school operators.
For his part, Rangel makes $266,000—more than anyone in the regular school system, including CEO Jean-Claude Brizard.

The house's executive committee, chaired by state rep Burke, passed HB 4277 by a 10-to-1 vote. Aside from Burke, five other Chicago Democrats voted for the bill in committee: Edward Acevedo, Luis Arroyo, Maria Antonia Berrios, Joseph Lyons, and Robert Rita.
Ironically, the bill faces opposition from downstate Republicans, who don't want their own cash-starved systems to lose money to the charters. Apparently, the mania for privatizing public education—while publicly funding private development deals—is largely limited to Chicago, supposedly a liberal, pro-union town.
Speaking of Chicago Democrats who act like Republicans . . .
Last week brought the revelation by our own Mick Dumke that Mayor Emanuel's been systematically pruning the city workforce. Well, not the whole workforce. In his office, Emanuel employs 86, up from the 81 Mayor Daley had on the payroll. Emanuel's also paying his mayoral office employees more than Daley did—an average of $88,000, up from $85,000.
Meanwhile, the number of police officers on the payroll is down to 10,600 from 11,200. The fire department's down to 5,000 from 5,100. The library's down to 850 from 1,070. And as the mayor continues to cut the things you need, there's more tax dollars to waste on the things he wants.
Like the NATO weekend!

The disparity was on full display over the last few days. On one hand, the police union posted signs on the Kennedy saying: "Keep Chicago safe—hire more police officers." On the other, the mayor canceled all days off so every officer—in his attrition-depleted police department—could be available for the frontline face-off with anarchists. If the police cuts continue, Mayor Emanuel can always fortify the front lines with his $100,000-a-year flacks, speechwriters, and policy analysts.
Now that would be a NATO diversion worth watching.