Late last year, just days before a historic transit bill finally passed and went to Gov. JB Pritzker\u2019s desk, it was loaded with controversial ideas.<\/p>\n
But before the final up-or-down vote, proposals for statewide taxes on package deliveries, streaming services and even event tickets were tossed aside. Instead, the lawmakers raised the Regional Transportation Authority sales tax, hiked tolls on the Illinois Tollway and pulled in $200 million from the state\u2019s road fund \u2014 which notably is intended for capital projects, not operations.\n<\/p>\n
Today, we\u2019re on to a different topic with yet another set of substantive last-minute changes. What started as a push to keep the Chicago Bears in Illinois has morphed into the so-called megaprojects bill<\/a>, which could institutionalize negotiated tax breaks statewide for everything from the proposed One Central mixed-use development<\/a> spanning DuSable Lake Shore Drive to new development around the quantum computing park along the lakefront.<\/p>\n Don\u2019t count out data centers, either. They\u2019re excluded from eligibility for now, but the industry is powerful, the potential for huge investment is appealing and legislative negotiations are far from complete.<\/p>\n Under the version of the megaprojects bill that the House passed this week, developers of projects costing at least $100 million could lock in privately negotiated tax cuts \u2014 so-called payments in lieu of taxes (PILOT) \u2014 for as long as 25 years. Projects worth $500 million could be eligible for 30-year agreements, and developments worth $1 billion would allow for 40 years of tax cuts guaranteed by cities, school districts and other taxing authorities.\n<\/p>\n At the center of the legislative trading that consumed Springfield this week was Chicago state Rep. Kam Buckner, D-Chicago, who also was at the center of last fall\u2019s transit talks. Buckner has an eye for a deal. His last-minute, mixmaster approach to closing out the transit negotiations irritated several participants, but the end result was a fiscally responsible and transformative restructuring of mass transit in northern Illinois.\n<\/p>\n The stakes are high again this time. And as happens in Illinois too often, the legislature could well pass a momentous bill \u2014 one that could shift hundreds of millions of dollars in tax burden from megaproject investors to their neighbors and even the state \u2014 without serious study of the knock-on impacts on property owners, local governments and the state budget.<\/p>\n The broader fiscal consequences for the state, and for homeowners, businesses and others, in a bill now in front of the Senate, are as mysterious as the ideas in it are bold.<\/p>\n At the heart of the matter is a simple fact: It takes a certain amount of money to run a government, and someone needs to pay the bills. If a megaproject developer negotiates a 40-year tax break with the local school district, let\u2019s say, then all the other taxpayers in that district have to make up the difference.<\/p>\n Buckner and others pushing for the megaprojects bill would seek to creatively mitigate the direct impact on ordinary taxpayers. Only half of the PILOT revenues would go toward property tax relief \u2014 of that, property tax rebates for neighbors of the project would account for 60%, and 40% would be deposited into the state\u2019s existing property tax relief fund.\n<\/p>\n It\u2019s a formulation Buckner unveiled just one day before the bill went to a House vote, with little study and just light debate.<\/p>\n But guess what? The PILOT funds that would cover those property tax rebates are dollars that otherwise would go toward the schools, roads, buildings and services that the taxing bodies still must pay for. One way or another, homeowners, business owners and other taxpayers will need to cover the gap.<\/p>\n Not to worry, the megaprojects bill backers say. Property values in the areas surrounding megaprojects will increase and property tax revenues along with them. But that\u2019s hardly guaranteed.<\/p>\n Stadiums are notorious for their lack of multiplier impact, which is one reason these days why sports team owners, such as the McCaskey family that controls the Bears, have such a hard time hoodwinking governments into giving them direct subsidies to build their stadiums. And some megaprojects could even lead to decreased property values nearby. If data centers eventually are included, for example, neighbors could take a hit due to impacts on electricity costs, water access, industrial noise and other nuisances that can come into play when a megaproject moves in next door.<\/p>\n Despite the lack of information about the net cost or benefit of proposals considered in the megaprojects bill debate, the rush is on in Springfield. Buckner showed his talent for dealmaking this week and got a 78-32 House vote \u2014 momentum that will carry into the Senate.\n<\/p>\n And that legislative momentum could make it all the harder for Buckner and his colleagues in the Senate, who now must consider their own version, to do the right thing and consider a pause \u2014 for the long-term good of the state.<\/p>\n That\u2019s right: Perhaps the megaprojects bill should stop right here, at least for now. There are too many open and unanswered questions to responsibly pass such a consequential law in such a rush.<\/p>\n The Bears are insisting on action now, or they just might move to Indiana. The General Assembly could deal with that risk, before the traditional May 31 close of the spring session, and table the broader megaprojects effort until the fall veto.<\/p>\n Preposterous? A deal is within reach, after all. But something quite similar happened with the transit restructuring last year, and the state, the northern Illinois transit system, and public transit users and taxpayers are better for it.<\/p>\n The alternate approach of passing a bill based on incomplete information and hoping for the best has had disastrous consequences in the past. The state\u2019s pension systems are a fiscal disaster and national disgrace in part because \u201creforms\u201d were passed with woefully incomplete analysis of their consequences.<\/p>\n No doubt Buckner and others have deal fever, and a successful Senate vote could be within sight. After all, the megaprojects idea has been under discussion, with Pritzker\u2019s encouragement, for three years now, so the temptation is understandable. But the right course would be to address the Bears matter now \u2014 and use the time between today and year\u2019s end to get the rest of the megaprojects bill right.<\/p>\n David Greising is president of the Better Government Association.<\/p>\n Submit a letter, of no more than 400 words, to the editor here<\/a> or email letters@chicagotribune.com<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"Late last year, just days before a historic transit bill finally passed and went to Gov. 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