Chicago is the third-largest city in the U.S.,
and back in 1984, it decided to rejuvenate districts
that were labeled as blighted.
To do this, the city instituted a plan
called Tax Increment Financing, or TIF.
The goal was to spur development in the poorer areas of the city.
And any increase in property values
doesn't go to local governments, doesn't go to schools,
it's diverted to economic development.
And right now it's basically at the sole discretion of the mayor
on how those funds are used.
The basic idea behind TIF was to provide tax funds
to encourage developers to build in distressed neighborhoods.
TIF programs like this exist in 49 states,
but each state differs
in exactly how they're administered.
These variances make it hard to present TIF
as a national problem, but it is.
In Chicago, for example,
a neighborhood is first designated as blighted.
Then that neighborhood's local property tax income
is frozen for 23 years
and any future increase in local taxes
is taken from the blighted neighborhood
and put into the mayor's TIF fund.
More than 500 projects in Chicago have received TIF funds.
Roughly 50% of the TIF funds are not flowing to these areas
that are, you know, "blighted."
They're instead going to affluent areas
where you have a lot of businesses,
where businesses would be investing and locating anyway.
Since 2006, Chicago Public Schools have been deprived
of $2.5 billion in tax revenues diverted to TIF.
Lincoln Yards is one such TIF project.
It's the largest development the City of Chicago
has considered in decades.
The North Side's $6 billion,
52-acre Lincoln Yards project is one step closer to reality.
The mixed-use development is expected
to bring in an additional 30,000 residents
to an already dense Lincoln Park and Bucktown neighborhoods.
The Hideout is an historic local music club
that lies within the $6 billion Lincoln Yards project.
Tim and Katie Tuten have owned the club since the 1990s,
and it's been a neighborhood hangout for nearly 100 years.
That bar in the front has been there since the 1880s,
and it was always called the Hideout
since the license name, 1934.
It was a community house.
The city designated the neighborhood as blighted.
Local residents scoffed at the idea.
This is actually prime property.
We're talking riverfront property.
I mean, Lincoln Yards is really sandwiched in between
two of the most affluent neighborhoods in Chicago.
[ Cheers and applause ]
So this is a thriving business.
It's been here for as long as we've been here,
25 years before that,
and it exemplifies the type of light manufacturing
that's been going on in this neighborhood forever.
When you come during the day, you can't find a place to park
because there's so many employees.
So in this building, it was a beautiful,
beautiful brick building.
They probably had 10 to 14 employees.
The building got sold before we knew it.
That weekend, they tore it down.
By Sunday, everything was cleared out and hauled away.
So it really sent a message that the developers were moving fast.
The Lincoln Yards project threatens many of the existing
local businesses,
but developers told Tim and Katie
that they want to preserve The Hideout.
They said that The Hideout was an enticement
for the type of clientele they want to attract.
And Tim and Katie would get more customers as well.
The developers, they have this theme that they constantly say
you're going to make a lot of money.
And when they tell us you're going to make money,
it's the opposite of the kind of real values
that we really hold and cherish.
To have a community of people that do things
because they love it and they believe in it,
that's where you have really depth of a life.
We're not against development.
We are against the use of public tax dollars
that are subsidizing a private luxury development.
[ Cheers and applause ]
So the city is being influenced
not by what is good for the neighborhoods,
for all of these people that can't find affordable housing
that live throughout the South and West Side of Chicago.
It is being driven by wealthy developers
who literally got together with our mayor
and said, sell us that property.
We will build luxury condos.
There'll be billions of dollars worth.
You kick in a $1 billion TIF,
and we will have this amazing development.
And just to put it in perspective,
the amount we're talking about here,
nearly a third of all property tax revenues collected
by the City of Chicago are now diverted into TIF districts.
We just set a record $841 million in TIF districts
in the City of Chicago in the most recent year.
The property was sold to a developer
and then the developer said,
Now that we bought it, we need a TIF.
And the TIF is usually the incentive to get a developer
to purchase a property.
They knew that money that could go to school children
on the South and West Side,
the economic development that could save our city.
And they decided, No, we don't care about those people.
We want it right here in this majority white, wealthy area.
We're going to push through a TIF.
The full city council approved the Lincoln Yards project
about 15 minutes ago.
Activists are vowing to amp up their opposition.
Protesters blocked off part of City Hall,
and they also packed the hallways on two floors inside.
But despite the outrage,
a swift decision by the Finance Committee
this morning set up the full council votes,
which went through as expected.
The most frustrating thing about the TIF program
is that it enables the pay-to-play politics
that are so widespread in Chicago.
We're taking away money from core government services.
We're taking away money from schools and repairing roads
and things that everybody in the community can use.
And we're essentially using that money to offset costs
for wealthy, well-connected business interests
who really don't need the help.
The use of these funds have typically been a slush fund
for the mayor of Chicago,
both Emanuel and Daley prior to him,
to sort of reward people who are politically connected
and possibly support their campaigns.
This was not done democratically,
and it was not done for the majority of the kids
and the working people in the South and West Side.
It was done by a small group of people
so that they could economically benefit $6 billion.
These are major decisions being decided
by a very small group of people
that are motivated by their own personal monetary gain.
This is not for the best of our city.
It's for the best of a few.
And that just is egregious.