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October 12, 2007
TIF Districts Stiff Taxpayers
by Keith L. Runyon, President of Concerned United Taxpayers (CUT)
For several years Local Government accountability groups OUTRAGE and CUT have opposed the formation of Tax Incremental Financing (TIF) districts. Such districts pillage the tax bases of school districts, park districts, fire districts and other taxing bodies.
Until recently it was difficult to quantify just how much TIFs bleed other taxing bodies. We recently received a tax bill from a small business in a nearby TIF. This tax bill illustrates the magnitude of the village TIF tax grabs. This taxpayer had a total tax bill of $31, 908. $25,889 of his tax bill was diverted to the a local TIF. Eighty two (82%) percent of his tax dollars that would have gone to the other taxing bodies were diverted to the village (TIF) slush fund.
Let’s quantify the long-term cost of TIFS to we taxpayers. The above example assumes a 3% annual increase in real estate taxes .During the 23 year life of the TIF, that single TIF taxpayer will have contributed $879,172. to the Village (TIF) slush fund and away from the other taxing bodies. This example of a single small businessman paying into a TIF illustrates the magnitude of the how much taxation from the Bradley Commons commercial area will be diverted from school districts and other local government by the Village of Bradley from the developers. It will be mega millions. Bradley Commons is located on Route 50 and St. George Road.
Local school districts have stood idly by while the Villages have TIF plundered their tax bases. Those districts have in turn, passed on their TIF created shortfalls to all taxpayers via increased levies and attempts to persuade voters to fork over more money through referenda.
What happens to the money in the village slush funds? It is usually paid back to the developers or businesses in the TIF as a form of bribery to get them to locate in the village. How silly. Retailers locate where the population lives. No bribery is necessary to get a retailer to locate where a market exists. Any time you buy goods from a retailer in the Bradley Commons development, you have to increase the price you paid by the subsidy you paid to bribe that merchant to come here and profit from your spending.
Until we can get the TIF law repealed, we need to remove from office the local representatives who keep stiffing us with TIFs