Illinois TIF law describes municipalities may create TIF districts at their own broad discretion.
Political darlings are chosen recipients of TIF monies-- free gifts of taxpayer cash, publicly owned land and buildings, special exemptions from taxes and fees, and public bond debt issued at taxpayers's risk to give no-strings cash gifts to developers up front (taxpayers of course eat the fees and interest, along with guaranteeing principal debt).
Within these TIF districts, property assessments are frozen at the year of inception .
For the next 35 years (23 years is possible technically, but there is no mechanism in Illinois law for taxpayers to prevent the rubberstamp 12 year extension by state legislators), any property assessment increase above the frozen value is assigned as taxable TIF increment, and the resulting TIF revenues are segregated to be spent only on TIF district projects.
TIF development creates not just 35 years of inflationary stresses on existing non-TIF taxpayers, but creates enormous NEW costs of social service provision which must be provided for free to TIF freeloaders.
TIF ALWAYS raises property tax rates. This is simple math. TaxRate=taxlevy/divided by taxable property value. Because TIF freezes property values, the numerator which rises with inflation is divided by an artificially suppressed denominator. Thus, tax RATES are always driven higher.
Illinois TIF statute is written to protect bondholders, so TIF revenues are strictly forbidden from being spent to cover the true costs of providing schools, police, roads, fire&rescue, etcetera to new TIF developments.
TIF in Illinois is interesting in that the very nature and history of its corrupt perverted deployment illustrates the current dire state of Illinois economy: unsustainable public debt, unfunded pensions, property tax rates 200% to 500% of national property tax rates everywhere else.
Illinois residential property values fall annually relative to homes everywhere else in America.
TIF is not the sole cause of Illinois's home value death spiral, but understanding TIF gets one closer to understanding and perhaps surviving the Illinois political industry's predatory brutality against Illinois taxpayers.
