IL TIF Transparency Bill Heads to Pritzker’s Desk
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(Northbrook, IL) – The Illinois Senate last week unanimously approved, 56-0, legislation that creates strict transparency reporting requirements for tax increment financing (TIF) districts in Illinois.
The legislation, House Bill 571 passed by senators on May 28, requires municipalities to report annually on the amount of jobs and new property tax revenue created by a TIF project. Reporting data would need to be verified by an independent consultant to prevent potential conflicts of interest with developers.
“Tax increment financing districts currently divert future property tax revenue increases from school districts, park districts, and other taxing bodies toward economic development projects, but do so with little transparency provided to taxpayers,” said State Rep. Jonathan Carroll (D-Northbrook), the measure’s chief House sponsor. “This bill says ‘show me the money.’ Show the amount of new property tax revenue generated; show the number of new jobs created. Prove yourself TIF.”
In the best-case scenario, a TIF brings new businesses and residents to an area that wasn’t generating much property tax revenue previously, but a bad TIF just adds to the existing tax burden on homeowners, and taxpayers are generally left in the dark about their performance.
“Most residents don’t know how TIF districts affect their property taxes or benefit the community,” said Ann Gillespie, who carried the measure in the Senate. “This plan will shed light on the process and provide transparency in our local governments.”
Through the use of TIF districts, city governments are able to divert future property tax revenue increases toward economic development projects. The extent to which TIF projects are successful varies.
The legislation now heads to Gov. JB Pritzker’s desk for consideration.
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