Polsky & Associates Ltd




Executive Summary

We examined Tax Increment Finance (TIF) Agreements approved by the City of Chicago between 2000 and 2008 to identify the nature and amount of TIF assistance provided by the City during that period.1 After excluding certain TIF Agreements, 154 projects in 82 TIF Districts comprised our data set.2 The project budgets for these 154 projects totaled approximately $8 Billion. Approximately $1.5 Billion in TIF assistance was pledged to these projects.

Of the 154 projects receiving a pledge of TIF assistance between 2000 and 2008, 58 of the projects were commercial projects, 36 were residential projects, 24 were public/education projects, 20 were Mixed Use3 projects and 16 were industrial projects. Of the TIF assistance pledged, approximately 36% went to public/education projects, approximately 32% to commercial projects, approximately 13% to Mixed Use projects, approximately 12% to residential projects and approximately 7% to industrial projects.

Between $225,000 and $98,013,671 in TIF assistance was pledged to each project. On average, the City pledged approximately 59% of the amount of the project budget to public/education projects, approximately 22% to industrial projects, approximately 21% to commercial projects, and approximately 16% to both residential and Mixed Use projects. The City’s pledge of TIF assistance was either in the form of TIF Bonds, TIF Notes, pay-as-you-go assistance, or a combination of these forms. TIF projects were most likely to receive all or a portion of TIF funds in the form of pay-as-you-go assistance as 97 of the 154 projects, or approximately 63%, received all or a portion of their TIF funds in this manner. Of the 154 projects included in the data, 22 projects, or approximately 14% received some or all of their assistance in the form of TIF Bonds.

Although the research examines the relationship between the project budget and the amount of TIF assistance pledged to that project, the fact that the City has pledged a certain amount of TIF assistance does not mean that the project actually received that amount of assistance. The City’s pledge is based on the amount of available tax increment and may be reduced if insufficient tax increment is generated. Projects may also receive less than the amount pledged based on the failure to meet certain conditions set forth in the TIF Agreements, including, for example, minimum job requirements and certain restrictive covenants.



1 The intent of the research was to study TIF Agreements that had been approved by the City of Chicago between 2000 and 2010, however at the time the research was completed, data on the City of Chicago website were only available through 2008.

2 Seven TIF Agreements were excluded because the Agreements did not include relevant information, such as project budget, the amount of TIF assistance pledged or because the full text of the Agreements was not available on the City of Chicago website as of March 1, 2010. Two Agreements were excluded because they provided for a pledge of TIF assistance in the amount of 100% of a discrete project component; however, total project scope and budget for these projects were unknown.

3 As used throughout this Article, the term “Mixed Use” means projects that have at least two separate uses, one of which is a commercial use, without regard to the percentage of each use.