Record #: O2016-5666   
Type: Ordinance Status: Failed to Pass
Intro date: 7/20/2016 Current Controlling Legislative Body: Committee on Finance
Final action:
Title: Establishment of Public School Revitalization Grant for distribution of Tax Increment Financing (TIF) Surplus Funds to financially distressed school districts
Sponsors: Cardenas, George A., Sadlowski Garza, Susan, Napolitano, Anthony V., Maldonado, Roberto, Sawyer, Roderick T., Foulkes, Toni, Waguespack, Scott, Pawar, Ameya, Cappleman, James, O'Shea, Matthew J., Brookins, Jr., Howard, Mitts, Emma, Sposato, Nicholas, Munoz, Ricardo, Villegas, Gilbert, Mell, Deborah, Taliaferro, Chris, Dowell, Pat, Ervin, Jason C., Ramirez-Rosa, Carlos, King, Sophia D., Scott, Jr. Michael, Lopez, Raymond A., Arena, John, Silverstein, Debra L., Quinn, Marty, Curtis, Derrick G., Osterman, Harry, Smith, Michele, Tunney, Thomas, Reilly, Brendan, Moreno, Proco Joe, Reboyras, Ariel, Hopkins, Brian , Burnett, Jr., Walter, Solis, Daniel, Zalewski, Michael R., Moore, David H.
Attachments: 1. O2016-5666.pdf
Related files: R2019-362
Committee(s) Assignment: Committee on Finance

Chicago Public Education Revitalization Ordinance

Whereas, Tax increment financing (TIF) is a tool intended by Illinois state law to encourage economic development by providing public support to en­courage investment in targeted areas that meet certain conditions of blight, decay or underperformance; and
Whereas, the Chicago Public Schools administration have imposed deep and unsustainable cuts in many neighborhood elementary school and high schools in consecutive past years; and
Whereas, the City of Chicago's neighborhoods are waiting for improve­ments to basic infrastructure after years waiting through the economic re­cession; and
Whereas, in light of the current economic circumstances, a short-term infu­sion of funds back into the schools and neighborhoods will offset drastic cuts, helping achieve the ultimate goal of supporting strong schools and our neighborhoods; and
Whereas, Cook County Clerk David Orr has released the 2016 TIF projec­tions which shows that Chicago will collect at least $461 million in TIF rev­enue for the 2016 tax year which is an increase in Chicago's 2016 TIF re­venue of almost $89,000,000 over the prior year; and
Whereas, this surplus includes moneys not required, pledged, earmarked, or otherwise designated for payment and securing of the obligations and anticipated redevelopment project costs; and
Definitions:
(A) "Financially Distressed School District" means a public school district, which is experiencing one or more of the following:
(1) A bond rating below investment grade has been assigned
" to one of the most recent five bond issues or a credit review
by a major rating agency has indicated that a future bond issue would be rated below investment grade.
(2) Total operating expenses exceeded total operating rev
enues by 5% or more in the school district's General Operating
Fund in its most recently completed fiscal year, as reported in

the Comprehensive Annual Financial Report. (3) The actuarial funded ratio of its teacher's pension fund is 75% or less as reported in the school district's most recent ac tuarial valuation report.
"Distressed Surplus Funds" means moneys in all Special Tax Allocation Funds not required, pledged, earmarked, or otherwise designat­ed for payment and securing of TIF Contractual Obligations.
"TIF Contractual Obligations" means bonds, loans, debentures, notes, special certificates or other evidence of indebtedness issued by the City of Chicago to carry out a redevelopment project or to
refund outstanding obligations and payments associated with a redevelop­ment agreement or other binding contract, which has been approved by the local governing body of the municipality. TIF Contractual Obligations do not include anticipated redevelopment project costs, multi-year capital plans, or other potential future payments not required to be made pursuant to a legally binding written document approved by the municipal governing body.

(D) Public School Revitalization Grant means a grant equal to 100% of a
taxing district's TIF surplus distribution, which a taxing district distributes to
the Chicago Public School district to be used for annual operating expens-
es.

Therefore, be it ordained, that:

Section 1: Ifthe Chicago Public School District qualifies as a Financially Distressed School District as of January 1 of each year, the City of Chicago must estimate by September 1 of the same year, total TIF Contractual Ob­ligations and total Distressed Surplus Funds for the next calendar year. The calculations of TIF Contractual Obligations and total Distressed Sur­plus Funds must be placed on the City of Chicago website and include a description of all calculations, assumptions, and a detailed list of all TIF Contractual Obligations. Within 60 days of collecting incremental taxes, the City will declare all Distressed Surplus Funds as "surplus" funds as defined in the Tax Increment Allocation Redevelopment Act (TIF Act) (65 ILCS 5/Art. 11 Div. 74.4). In addition to distributing the appropriate portion of surplus funds to the taxing districts in accordance with the TIF Act, the City of Chicago will distribute a Public School Revitalization Grant to the Chica­go Public School District no later than December 31 immediately following

the September 1 calculation of total TIF Contractual Obligations and total Distressed Surplus Funds. In addition, the City of Chicago will encourage all other taxing districts to make Public School Revitalization Grants to the