Chicago Public Education Revitalization Ordinance – Summary
July 19, 2016
Objective: The Chicago Public Education Revitalization Ordinance (the Ordinance) provides the City of Chicago (the City) a process for directly aiding the Chicago Public Schools (CPS) by declaring TIF surplus and providing a supplement grant from the City’s share of TIF surplus.
Process: Unlike past years in which the City determined the amount of TIF surplus by privately analyzing TIF funding requirements and surplus availability, the proposed Ordinance would require the City to annually calculate and distribute available TIF surplus based on incremental tax collections, existing contractual agreements, and financial obligations, excluding potential future project obligations, which may or may not occur.
Enhanced Transparency: The Ordinance would require the City to provide its annual TIF surplus calculations on the City’s website detailing its assumptions and contractual obligations.
Increased City Support of Public Education: In addition to the CPS receiving its proportional share of TIF surplus distribution (approximately 53%), the proposed Ordinance would require the City to contribute its proportional share of TIF surplus distribution (approximately 20%) as a Public School Revitalization Grant to pay for CPS operating costs. The Ordinance also requires the City to encourage other taxing districts (e.g. Cook County, Chicago Park District, Metropolitan Water Reclamation District, and City Colleges of Chicago) to contribute their respective proportional shares of TIF surplus as additional Public School Revitalization Grants.
Expected Impact: From the Fall 2015 TIF collections of approximately $371 million and fund balances, the City of Chicago declared TIF surplus of $116 million during through June 30, 2016, of which CPS received an estimated $61 million (53% of surplus distribution) for operations.
Fall 2016 collections are projected to be $89 million more than 2015 or $461 million (Source: Office of the Cook County Clerk). Under the proposed ordinance, if the City contributed $205 million of TIF surplus by December 31, 2016, CPS would receive an estimated $150 million (73% of surplus distribution) for operations.