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“How does Transit TIFs Contribute to Residential Displacement in Chicago?”

Author: Ashley Cruz

Department: UIC Institute for Policy & Civic Engagement

Advisor: Dr. Joseph K. Hoereth, IPCE

Abstract: Tax Increment Financing (TIF) is a major financing tool in Chicago established in the 1980s to help lessen the city’s dependance on federal funding. The original purpose of TIF is to help improve blighted neighborhoods. In contrast, TIF is controversial in Chicago due to lack of detailed reports of where the funds are going and supporting private development in return for revenue. In 2016, the Illinois General Assembly established Transit TIF to fund four transit projects without using funds from TIF. In past transit projects, there were no plans on relocation for residents until the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 which required transit agencies to give guidance and compensation to residents. Per federal law, the CTA released a draft Transit-Supportive Development Plan to layout their proposals. One project, the Red Line South Extension (RLE) project, brought concerns of displacement from residents who live in Roseland and West Pullman neighborhoods. Approximately 150,000 residents will be affected over the four-year construction timeframe. This research uses the CTA RLE project to examine the differences between TIF and Transit TIF and assess their relationship on resident displacement. A literature review examines scholarly journals and transit agency websites to determine Transit TIF’s history in Chicago and its future impacts on funding and relocation. While findings suggest that there are plans for relocating businesses and homeowners, there are no guaranteed plans for renters despite receiving financial assistance. There does not appear to be publicly available records on TIF management, spending, and benefits. Policy changes include more regulations of reallocation of TIF funds for affordable housing, schools, and health services.

Keywords: Tax Increment Funding, Transit TIF, Chicago, Displacement, Transportation Finance