http://www.chicagobusiness.com/cgi-bin/news.pl?id=21280
City proposes $550M LaSalle Street revival
July 11, 2006
By Greg Hinz
Chicago's financial district suffers from 'deterioration' and 'obsolescence'
(Crain’s) — City Hall Tuesday unveiled a half-billion-dollar plan to subsidize the rebirth of a huge swath of the Loop financial district, saying that Chicago’s traditional financial heart suffers from “deterioration” and “obsolescence.”
After months of rumors, the Daley Administration formally proposed to designate a 40-block section centering on LaSalle Street south of the river as a tax increment financing (TIF) district.
The city did not immediately spell out who would get money or in what amounts. But under an overview proposal submitted to the Community Development Commission, at least $550 million in property-tax receipts would be diverted from the Board of Education and other local governments over the next 23 years and instead be used to clear land, subsidize new building and redevelopment, and pay for public projects in the area, possibly a proposed Monroe Street express busway.
The proposed new TIF includes most of the Loop that is not already in the Central Loop TIF district to the north and east. Included are such landmark properties as the Board of Trade Building, City Hall, the Inland Steel Building and the Rookery, as well as the Riverbend site at Lake and the river that has been eyed for new growth.
Though many buildings in the area have historic charm, a lot of them “need help,” said Lori Healey, the commissioner of the city Department of Planning and Development. Only by modernizing mechanical and other systems will such buildings be able to compete with newer structures to the west and in the suburbs, she said, and building owners may not be able to afford to do that without city assistance.
United Airlines reportedly has considered at least two buildings in the proposed district for its new corporate headquarters. United is considering moving downtown, out of state, or staying in suburban Elk Grove Township.
The biggest budget item in the plan proposed Tuesday was $200 million for public works and related improvements. Ms. Healy said that could include a wide range of projects but said the city is particularly eyeing transit projects to fight increased downtown congestion.
Another $200 million is allotted for rehabilitation of existing buildings, with $50 million for property assembly.
The projects would be funded by growth of property-tax receipts within the TIF area. The city argues that much of that growth would not occur if not for the subsidies, but some civic groups have argued that it is not wise policy to strip schools of even inflationary growth in tax receipts.
Ms. Healey said the city “continues to review” what to do with the Central Loop TIF district, which is due to expire after next year.
That district originally was proposed as a means to help East Loop landlords modernize their buildings, but more than $100 million ended up being diverted to pay construction cost of Millenium Park.
The Community Development Commission took the plan under review, but is expected to approve it later this year.
