Last week’s local papers published a guest essay by Ald. Dan Knight (5th), the chairman of the Park Ridge City Council’s Finance Committee, about the financial problems and disappointments presented by the Uptown TIF.

Readers who didn’t pay attention to the TIF process when it was being created and implemented by past mayors (Ron Wietecha and Mike Marous) and City Councils (from 2003 through 2006) can benefit from the short history and explanation of the TIF presented by Knight.  But the essence of that essay is whether the City should stop abating the property taxes that otherwise would be levied specifically to pay the TIF-related General Obligation (“G.O.”) bonds.

Until now, the City has abated those property taxes related to servicing the TIF-related G.O. bonds, which are backed by the City’s full faith and credit (i.e., all of its assets and taxing ability).

This is significant in two respects, the first being transparency.

According to Knight’s essay and the front page of the Agenda Cover Memorandum by the City’s Acting Finance Director, Kent Oliven, the City’s customary abatement of those taxes that otherwise would be specifically levied by the County to cover the annual debt service on the City’s four TIF-related bond issues (Series 2004A, 2005A, 2006A and 2006B) means that those expenditures are “rolled into the City of Park Ridge line on a property tax bill” while TIF-related levies would “have their own line” on that bill.

We’re not sure why that has been done for all these years, but one explanation that comes readily to mind is that those mayors and aldermen responsible for the TIF decided that the luster of their grand Uptown project might dull a bit in the public’s eye if the million-dollar-a-year debt service cost kept popping up as a separate line item on each semi-annual tax bill.  Such an explanation seems to be born out (based on admittedly anecdotal evidence) whenever ordinary citizens discuss the TIF and the Uptown redevelopment it funded.

Ask residents if they like the development itself, and most respond with an unqualified (and often smiling) “yes.”  But inform them that the TIF has been running up $1 million annual deficits totaling approximately $6 million so far, which the City’s General Fund has been covering, and the response usually changes to an irritated “What?”  And follow that up with the expert projections now suggesting that the TIF will produce a total deficit of more than $20 million over its lifetime instead of the $40 million windfall profit the TIF-addled mayors and aldermen were touting less than a decade ago, and the average listener will go from the irritated “What?” to an incredulous “WTF”?!?!

And all that’s without telling them how all those TIF deficits have led to a downgrade of the City’s bond rating.

The second significant aspect of the TIF-related tax abatement involves how that abatement has resulted in the TIF’s looting of the General Fund by the approximately $6 million referenced above.

So the City Council is going to take up the abatement issue this November and December as part of its 2014-15 budget process.  The Mayor and the Aldermen will discuss whether to raise the City’s tax levy to cover all or part of the debt service cost of those TIF-related G.O. bonds, thereby reducing or eliminating the continued erosion of the General Fund.  Oliven suggests that doing so would send “a signal that the City is aware of its debt obligations and is willing and able to raise taxes, if necessary, to meet those obligations.”

This is what it’s come to: further reduce expenses, or raise revenues through a higher-than-usual tax increase.

We’d love to see former mayors Wietecha and Marous, former city manager Tim Schuenke and all those TIF-loving aldermen return to take a bow for those results of their grand TIF plan, and maybe share with the current Council and City Staff all the reasons why the TIF garnered their enthusiastic support.  But we’re guessing that isn’t likely to happen.  The ones we’ve talked to recently seem to have partial Alzheimers (Half-heimers?) when it comes to the TIF’s financing and projections.

Which proves the old adage that success has many fathers, but failure is an orphan.

Which the current Mayor and Council have been forced to adopt.

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