In Chicago’s 2012 proposed budget, approximately $62 Million in TIF funds have been designated as surplus. Based on Illinois TIF law and current property tax rates, the surplus will be distributed as follows:
- approximately $30 Million to the City of Chicago school district;
- approximately $12 Million to the City of Chicago; and
- the remainder to the other taxing bodies.
Chicago plans to use the one-time surplus distribution of approximately $12 Million as one resource to reduce its $635 Million budget deficit.
This is not the first time that Chicago has tapped TIF funds to temporarily solve budget issues. In 2010, Chicago declared a surplus of approximately $180 million in 25 TIF districts, and used its share (approximately $38 Million) to partially fill a $655 million gap in the 2011 City budget.
As a result of the economic downturn, Chicago is not the only government using TIF dollars to pay for other expenses. Earlier this year, California requested that state-wide redevelopment agencies be allowed to transfer TIF dollars to schools and other special districts.