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Penny Pritzker’s TIF

School board member Penny Pritzker’s Hyatt Hotels Corp. is benefiting from a $5.2 million TIF subsidy on 53rd Street – while CPS’s proposed 2013 budget cuts seven schools surrounding the hotel project by $3.4 million, which is roughly the portion CPS is losing from the TIF deal.

“This one example shows the fundamental corruption in the way things are done here,” said David Orlikoff of the Chicago Teachers Solidarity Campaign, a labor and community coalition growing out of Occupy Chicago’s labor committee and supporting the Chicago Teachers Union.

CTSC will hold a press conference and speakout and picket the project at 53rd and Harper on Wednesday, August 8, starting at 5:30 p.m.

“As a member of the Board of Education, it’s Penny Pritzker’s job to find money for our schools, not to take our money for her business,” Orlikoff said.

The $5.2 million subsidy is part of $20.4 million in TIF funds going to the University of Chicago-led redevelopment of Harper Court (see here for some background).  In addition to the hotel, the university is building a 12-story office building in the first phase of the project.

CTSC points out that Pritzker has a net worth of $1.8 billion, and the University of Chicago – now engaged in a huge campus expansion – has an endowment of $6.6 billion.

“They have plenty of money,” said Lorraine Chavez of CTSC.  “They don’t need a taxpayer subsidy to pay for it.  It’s outrageous.”

At Catalyst, Penny Pritzker clarifies that she’s not personally receiving the $5.2 million, and in a statement to Newstips, Hyatt points out that the Hyde Park Hyatt will not be owned by the corporation but, like many Hyatts, operated under a franchise agreement, thus “neither Hyatt Hotels Corporation nor Penny Pritzker…is receiving TIF funds as a result of this project.”

Conflict of interest

“The school board should be defending school funding when the mayor wants to take it for TIFs; it’s the only body in a position to do that,” Orlikoff said.  “But they’re appointed by the mayor, and they look the other way.

“Then they tell teachers they don’t have any money for anything, except the mayor’s pet projects.  It’s a conflict of interest – and it will be a conflict until the school board is elected.

“We need representation on the school board, and we need to end the chronic underfunding of our schools,” Orlikoff said.

CTSC, which exists “to support teachers and fight for equitable quality education,” calls for increasing school funding “by reclaiming TIFs and taxing the rich.”

TIF is “a failed program,” Orlikoff said.  “It’s not fighting economic blight, it’s a way of taking from everyone and giving to the One Percent.”

Questions on 53rd Street

There are lots of questions right now about the 53rd Street TIF, especially with a new TIF district now being carved out of it by a second developer.

Antheus Capital, planning an upscale residential and retail development at 51st and Lake Park, wants to break its parcel out of the 53rd Street TIF to form its own TIF district —  in order apply for $10 million or more in TIF funds.  The 53rd Street TIF advisory council has okayed the proposal.

But after ten years of operation, the 53rd Street TIF fund has a balance of just $3.7 million.

Now, with thirteen years to go, it’s on the hook for a $20-million subsidy, while revenues are slowing (due not just to a lousy economy but to the County Assessor’s new formula, which shifts the property tax burden from commercial to residential taxpayers) – and the TIF district is getting smaller.

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