TIF Success Stories: Funding Local Economic Development in the Chicago Region
NAIOP Chicago, together with SB Friedman Development Advisors, has published TIF Success Stories: Funding Local Economic Development in the Chicago Region, the culmination of a thorough and detailed initiative by NAIOP Chicago to highlight the benefits of Tax Increment Financing as a valuable and effective tool to not only spur economic development but create jobs and increase a community’s tax base.
Almost every town has a site that is underutilized and not effectively fulfilling the town’s economic development goals. These sites could be located in obsolete commercial corridors, industrial parks, or underperforming downtowns. Depending on the scale and context of the underutilized site, the lack of economic activity may have a negative influence on adjacent properties, reducing their value and development potential. In many cases there are physical, real estate market and financial barriers that prevent these sites from realizing their full economic potential.
One approach to achieving public policy goals for these sites, as well as the financial objectives of the property owners, is to establish a public-private partnership to facilitate development that unlocks the potential economic value of the sites. Tax Increment Financing (TIF) is one of the most powerful tools for public-private partnerships that can help remedy site development barriers such as environmental contamination, lack of public infrastructure, or other “extraordinary” costs that private developers typically do not undertake on their own or that make a project unfeasible.
TIF Success Stories: Funding Local Economic Development in the Chicago Region presents a case study approach to demonstrate best practices and the revitalizing effect of TIF in the Chicago region, including the following five cases:
- Berwyn Gateway Plaza: TIF helped catalyze the phased redevelopment of a walkable restaurant and retail corridor along Cermak Road
- Downtown Palatine: TIF paid for a public parking structure that freed several acres of Village-owned surface commuter parking for redevelopment, including residential, office, and restaurant uses
- The Glen: TIF facilitated the redevelopment of Glenview’s decommissioned U.S. Naval Air Station into The Glen, a 1,100-acre mixed-use development that includes the walkable Glen Town Center, nearly 2,400 residential units, a retail complex, a hotel, 500,000 sq. ft. of Class A office, and a Metra train station
- Melrose Business Center: TIF expedited the redevelopment of two vacant obsolete manufacturing facilities and allowed for modern industrial and warehouse redevelopment in Melrose Park
- The Stockyards: TIF set the table to transform a portion of the former Union Stockyards livestock processing facilities into a modern, urban infill industrial park
These case studies have been selected to highlight the flexibility and potential broad applicability of TIF. The cases are varied not only in their location within the Chicago region, but also in their project goals, land uses, scale, and surrounding demographics.
The following case study profiles include a description of each project’s need for TIF assistance and identify quantitative and qualitative evidence of the benefits of projects, both at the project level and surrounding areas. For the purposes of the analysis, the terms “Projects” or “Project Area” are defined as areas where TIF funds directly led to development outcomes. “Influence Areas” are defined as surrounding areas where the positive impacts of direct TIF assistance radiated beyond the “Project” to drive additional investment and/or tax base growth.
The five case studies adhered to various TIF best practice principles to achieve TIF-funded project objectives and maximize public benefit. The following section provides a framework for the effective use of the TIF tool in public-private partnerships.
Questions: Contact NAIOP Chicago or call 773-472-3072.