Abstract

While there are many supporters of TIF, it is not without opposition. The highly respected Chicago Business letter, Crains, believes that "TIFs are one of the all time great economic development boondoggles in Illinois" (9/14/92). Many people also have the perception that 'TIF has been misused to finance 'sweetheart' deals with local developers at state expense" (Ayers 21). Whether this is true or not, there are clearly differences in the level of blight and deterioration among districts. Many argue that development would have occurred in some of these districts without the aid of TIF, and that these developments merely shift jobs and tax revenue from non TIF areas into the newly developed TIF districts resulting in no net gain.

With this background information in mind, this study has the following research objectives. First, the impact on the state resulting from the sales tax TIF program will be analyzed. It is obvious that most cities, developers, and investors love TIF. The state's relationship with TIF, however, has turned sour. It must be determined whether the state has made a mistake by withdrawing its support. After the data are analyzed, the current policy stance of the state will be evaluated to see if it is making a mistake by withdrawing its' support.

Secondly, a case study of the three TIF districts in Bloomington will be conducted. Net job and tax revenue growth will be examined to see if districts are merely transferring income or if they are creating jobs and revenue. Local impact from TIF will be also be compared with the impact on the state, because what is good for a single entity may not necessarily be good for the whole. The research will be completed in the following order. First, the theoretical framework will analyze the costs and the benefits for the state. Then, the economic model used for the state and the results obtained from the model will follow. Next, the case study of Bloomington will isolate and examine three different TIF districts. Finally, the conclusion will tie the paper together and offer policy advice for the state.

Disciplines

Economics

Included in

Economics Commons

Share

COinS