Chicago one step closer to creating special tax district for Red Line extension

Mayor Lori Lightfoot’s plan to pay for part of the long-sought extension the CTA Red Line south to 130th Street advanced Monday as council members agreed to collect revenue from a special taxing district that spans from downtown to the South Side Bronzeville neighborhood.

In a win that Lightfoot needed to keep the extension plan moving forward, the City Council’s Finance Committee approved the measure with only Ald. Pat Dowell, 3rd, voting in opposition. The proposal for funding some of the $3.6 billion extension via a new transit tax-increment financing district heads to the full City Council for a final vote, expected Wednesday.

The TIF district is expected to generate about $959 million and would help fund extending the Red Line south 5.6 miles. But additional funding, especially from the federal government, will be needed to pay for the whole project.

Dowell, who represents the Bronzeville neighborhood, said she supports the idea of the Red Line extension but balked at the idea that a large chunk of the money would come from tax dollars generated by residents of her ward. She noted the extension would not “directly benefit” them.

“Everyone should have skin in the game when paying for the project,” said Dowell, who is a Lightfoot ally on the council and is the mayor’s hand-picked chairperson of the Budget Committee. “This has to include the entire city, the state of Illinois and Cook County. It cannot just be five wards.”

But Ald. Nicole Lee, 11th, whose ward also overlaps with the pending TIF district, supported the plan because, she said, it has been sought by city leaders for years yet never come to fruition. Lee, who Lightfoot appointed alderman earlier this year, acknowledged voting for the new TIF district was “not the most politically expedient thing do” given she is facing a number of challengers in the February election.

[ As officials plan Red Line extension, there’s still no green to fund it ]

“Our constituents are feeling the pinch in all of this,” Lee said. “But this isn’t something that we should wait on any longer. This is long overdue, and I’m going to be very happy to be a part of making this history and really expanding the vision set forward by the Red Line.”

In prepared remarks, CTA President Dorval Carter said there was one word that encapsulates the urgency for the project: “Fairness.”

“It is not a mistake that this community on the Far South Side of the city is the only community in a city the size of ours — with one of the best transit systems in the country — that does not have access to rail,” Carter said. “We have an opportunity here with this project to correct what has been a decade of wrongdoing for this community.”

Ald. Anthony Beale, 9th, said he and his Far South Side constituents have pushed for a Red Line extension for years. While he voted yes on Monday, he warned city and CTA officials that they should be more aggressive with securing funding from Springfield and Washington — “not $959 million coming off the backs of the people of the city of Chicago.”

Carter responded that it was unlikely the federal government would commit funding without the city putting up local dollars.

The plan calls for extending the Red Line from 95th Street to 130th Street. The extension, which would be elevated for much of its length and run at ground level near the end, is planned to have four stations: 103rd Street near Eggleston, 111th Street near Eggleston, Michigan Avenue near 116th Street and 130th Street near the northeast corner of Altgeld Gardens.

The CTA has said the project will help bring more transit options to residents of the Far South Side who have been promised some form of an extension for decades. Rail service on the Far South Side could shave more than half an hour off commutes, the CTA has estimated.

The TIF involves taking growth in property values from land located within half a mile between Madison Street and Pershing Road along the current Red Line and sending the money south to help fund construction of the extension. Its duration would last longer than a traditional TIF, sunsetting after 35 years.

[ CTA determines path for proposed Red Line south extension to 130th Street ]

This plan follows a 2016 state law that listed four specific transportation projects for which TIFs could be used, including the Red Line extension. The legislation also allowed a transit TIF for a project underway farther north on the Red Line, where it is helping fund an overhaul of part of the line that includes a flyover carrying northbound Brown Line trains over the Red and Purple tracks near the busy Belmont station.

The TIF is expected to make up a substantial portion of non-federal funding for the extension project. CTA has already received some funding from the federal government but is seeking at least $2 billion from a federal program, for which the TIF would help the agency meet a required local match.

If all goes according to plan, construction on the extension could begin in 2025, and the project could be finished by 2029.

Also on Monday, the Finance Committee approved using TIF funding to help pay for a Near South Side high school that has sparked controversy over potentially siphoning enrollment from existing Black-majority schools as well as being located on a former public housing complex site.

If approved, the TIF, bound by the 24th Street and Michigan Avenue area, would fund $8 million of the $10.3 million needed for the land deal.

Neighbors, some community activists and others have expressed reservations about the school, the cost of which was at $120 million but is now estimated by the city at $150 million. Chicago Public Schools officials have said surrounding neighborhood schools would see no more than single-digit declines in their enrollment. Concerns have also arisen over the land swap deal between the school district and the Chicago Housing Authority that would pave the way to build the proposed school at the former Ickes Homes at 2450 S. State St.

The committee’s advancement came a few months after the state representative for Chinatown, who has long clamored for a neighborhood high school for constituents, announced to the Sun-Times she will request that the governor’s office block $50 million in state funding for the project because of the protests. That move by Theresa Mah, a Democrat, was criticized Monday by a Lightfoot ally.

“I’m not one to throw a state (representative) under the bus, but let’s be real here,” said Dowell, who represents the ward where the high school would be built. “This decision that she’s making is basically because the school is not in her district. It’s not about the children. We will continue to press her, Alderman Lee and I.”

Dowel continued: “Come hell or high water, we’re going to figure out how to make this work, with or without Theresa Mah.”

Mah wrote in a Monday statement: “The decisions I make always aim to benefit the most and do harm to the fewest number of people. My position on the Near South high school proposal is based on that principle.”

Aldermen on the Finance Committee also voted down an initiative by Ald. Brendan Reilly, 42nd, to end Lightfoot’s annual property tax increase tied to inflation. It failed by a 17-11 vote.

With inflation soaring, Reilly argued the 2020 Lightfoot policy automatically hiking taxes each year by the consumer price index is “a ruse, it’s smoke and mirrors to allow this administration and future administrations to hide behind when they want to justify future property tax increases on Chicagoans.”

But city Chief Financial Officer Jennie Huang Bennett said the law provides property owners some idea how much taxes will go up year to year. Getting rid of it might cause credit agencies to downgrade Chicago’s rating, costing the city more to borrow money, she said.

Chicago Tribune’s John Byrne contributed.

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