TIF for Tat 

Why the governor is suddenly so interested in the mayor's pet financing scheme

In the middle of protracted negotiations over the state budget, with health care insurance, education funding, and public transportation at stake, the state's top political leaders broke for two precious hours last week to talk about my favorite municipal topic: Mayor Daley's tax increment financing districts.

No, they didn't do it as a favor to me. Insiders speculate that it's part of a larger game of political tit for tat in which Governor Blagojevich is attempting to muscle concessions out of House Speaker Michael Madigan.

Blagojevich wants to establish a statewide health care plan to protect the uninsured and enhance his lackluster political reputation. Madigan's opposing him because he doesn't think the state can afford it--and he doesn't want Blagojevich to have a legacy if he makes a reelection run against his daughter, Attorney General Lisa Madigan, in 2010.

Over the last few weeks Daley and Madigan have been getting kind of chummy. Daley pulled his support from the more generous tax relief plan of senate president Emil Jones and endorsed Madigan's watered-down home owner's property tax exemption. Why? According to statehouse sources it's because Madigan agreed to support an extension of the Central Loop TIF, which was created in 1984 and is set to expire this year. What's at stake? If the General Assembly extends it, it will continue pumping hundreds of millions of dollars a year in property taxes to a slush fund controlled by Daley for another 12 years.

When Blagojevich figured out what Daley and Madigan were up to, he countered by calling in Cook County commissioner Mike Quigley, until then the only elected official who had dared to criticize TIFs.

Blagojevich convened a closed-door meeting on June 20. In attendance were Madigan, Jones, Republican house leader Tom Cross, Republican senate leader Frank Watkins, and Quigley. On hand representing the mayor were two of his top aides, chief of staff Lori Healey and executive director of Intergovernmental Affairs John Dunne, as well as four aldermen loyal to the mayor: George Cardenas (12th), Latasha Thomas (17th), Ray Suarez (31st), and Carrie Austin (34th).

Quigley laid out the flaws in Daley's TIF programs, which have been cataloged here before: they extract money from blighted communities and shower it on rich ones; they divert tax dollars from the schools, county, and parks; they're not monitored by any independent body; they're a hidden tax that doesn't appear on property tax bills; and perhaps of greatest concern to the state legislators, they exploit the state's school funding process to the tune of millions of tax dollars annually, obliging the state to compensate for funds sucked into the TIFs.

When Quigley finished, the aldermen counterattacked--and you really have to give the mayor credit. If you want to defend an antipoverty program, which is what TIFs are supposed to be, you don't bring in white aldermen or downtown developers. You bring in minority aldermen--even if it's their constituents who are getting shafted. And so the aldermen--two black and two Hispanic--laced into Quigley, praising Daley and his TIFs.

But as Quigley pointed out, his research, backed by academic studies, shows that TIFs benefit well-to-do neighborhoods more than they do poor ones. Over the last two months, for instance, the city has proposed to spend well over $70 million in TIF dollars on downtown or Gold Coast projects and nothing in the wards of Austin, Cardenas, Thomas, or Suarez.

In response Austin brought down the house by telling Quigley, "Professors never built nothin'." Her point? Aldermen don't care if the TIF program is logical, fair, or ultimately bound to drive taxpayers bankrupt. They just want the goodies that TIFs provide. Want a new school, a new park, or money for your pet redevelopment project? TIFs are the only game in town. And to get yours, you have to support everyone else's.

What will come of all this? Probably nothing, at least in terms of TIF reform. As one gubernatorial aide told me, "If Daley and the aldermen want to shoot themselves in the head, it's not our problem." Madigan's spokesman, Steve Brown, who attended the meeting, was openly contemptuous of Blagojevich and Quigley and called the session a waste of time. "It's another day in Rod Wonderland," says Brown. "It reminds me of a Bible-study thing where the minister comes in and talks about his favorite scripture."

Quigley says he's not surprised that he's virtually alone on this issue. Anyone who dares to criticize the mayor's favorite program can't expect to have a lot of friends. "Privately senators and reps told me, 'Good job, you're right,' but they were saying it very quietly and looking to see if the mayor's people saw them talking to me," says Quigley. "It's a scary world when you're afraid to dissent. I don't know if the mayor recognizes that most of his support comes out of fear."

The Coconut Brings in a Closer

It was the Terry Bruner show at City Hall last week. The 69-year-old former federal prosecutor, who used to make headlines in this town as the publicity-loving, crime-busting head of the Better Government Association, came to offer closing arguments on behalf of Frank Coconate.

Coconate's the northwest-side political activist who blew the whistle on city corruption and then was fired from his water department job in 2005 on the grounds of "a pattern and practice of serious misconduct." (The firing took place just a few days after he was seen on a TV news report sitting in a city truck and wearing a Jesse Jackson Jr. for Mayor button.) He appealed to the city's Human Resources Board and was assigned a hearing officer, Roger Balla, who held a series of sessions culminating in closing arguments June 18.

The setting was an 11th-floor City Hall hearing room--drab, windowless, and lit by fluorescents. If this had been a movie it would've been the story of the old gun coming out of retirement to show the young bucks a thing or two. Bruner, who's retired and lives in New Mexico, was up against two lawyers for the city--Kathleen O'Neill and Thomas Aumann. O'Neill sat silently for the hearing, and Aumann talked for maybe 20 minutes, never rising from his seat as he recited the charges against Coconate.

In contrast, Bruner talked for at least four hours, with only one ten-minute break (the court reporter had to use the bathroom). His speech ranged from rage to fury to sarcasm to humor. He lowered his voice, raised his voice, and made it crack with emotion. He paced back and forth, never sitting and forever fiddling with his glasses, frequently stabbing them in the air to make a point.

Much of the time he addressed O'Neill and Aumann as if they were his students in a class on the history of political corruption in Chicago. He reminisced about old clients, friends, and adversaries, dropping their names: Mike Royko, Jesse Jackson, Richard J. Daley, Mike Wallace, Pam Zekman. He talked about the crooked city workers--like bribe-taking firefighters--he'd busted in BGA sting operations and the heavy-handed hooliganism of the Democratic machine. His purpose was twofold: to link Coconate to a long line of local whistle-blowers punished for telling the truth and to ridicule the case against him.

I didn't sit through the hours and hours of previous hearings--the transcripts cover 30,000 pages of testimony--but based on the closing arguments, it seems that the worst thing the city has on Coconate is that on one occasion he was somewhere other than he said he was while he was on the clock. But it's not as though he was caught with his pants down. He said he was at one work site when in fact he was at another. Bruner dismissed the offense as trivial and attributed it to sloppy record keeping on Coconate's part. As one eye-rolling journalist put it at the end of the five-hour ordeal, if they held every city worker to those standards, "there'd only be about 100 people left on a payroll of 35,000."

This doesn't mean Coconate will get his job back. If Balla was swayed his recommendation will go to the Human Resources Board, whose members are appointed by the mayor. Either side can appeal the board's ruling to the circuit court--the case could drag on for years. From the city's perspective it's worth the investment even if Coconate wins back his job (back pay included). This case sends a message every city worker can understand: Keep your head down.

For more on politics, see our blog Clout City at chicagoreader.com.

Art accompanying story in printed newspaper (not available in this archive): illustration by Kurt Mitchell.

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