Judge critiques lawsuit challenging $1.3 billion TIF for Lincoln Yards

He questions groups’ citations of harm in city’s subsidy for North Side development.

A Cook County judge expressed sympathy for community groups suing to block tax subsidies for the Lincoln Yards development but offered withering criticism of their legal theories during a court hearing Wednesday.

Circuit Judge Neil Cohen challenged the groups’ arguments that they have legal standing to bring the suit over the city’s pledge of subsidies of up to $1.3 billion. He also expressed skepticism of their contention that city officials, under outgoing Mayor Rahm Emanuel, violated state law in creating a tax increment financing district for Lincoln Yards.

Cohen said he didn’t see how the groups, Grassroots Collaborative and Raise Your Hand for Illinois Public Education, were harmed by the city’s decision, a legal prerequisite for bringing the case.

While repeatedly challenging the groups’ lawyers, Cohen took the case under advisement and said he hoped to have a written ruling next week. He set the next hearing for Oct. 18.

At one point, Cohen told a young lawyer representing the groups, “I know how millennials think, but we’re not here to give you everything.”

As advocates for social justice, Grassroots and Raise Your Hand contended they’ve had to divert money and staff to the Lincoln Yards issue. Cohen countered that’s just a management decision all organizations must make. “You are not being frustrated in your purpose,” he said. “You will walk out of this courtroom and you’ll be doing exactly what you’re supposed to be doing.”

The City Council created the TIF district in April, but new figures for property valuations came out a month later. Had the city waited for those figures, the growth shown in Lincoln Yards property values might have made the site ineligible for TIF help.

Attorney Maggie Sobota, representing the city, said officials met the state requirement by showing that property values in the TIF grew at less than the citywide average for three of the past five available years.

The issue is that developer Sterling Bay began making heavy investments to convert the mostly industrial North Side land, which was marketed to Amazon for a headquarters. The activity drove up valuations so that in 2016 and 2017 the area saw growth exceeding city averages.

Had the city waited a few weeks for 2018 numbers, it would have no legal justification for a TIF, said attorney Aneel Chablani of the Chicago Lawyers’ Committee for Civil Rights. As a result, community activists contend the vote was rushed through the City Council in the Emanuel administration’s waning days.

“The truth is that Lincoln Yards did not qualify for TIF funding at the time it was passed,” said Veronica Rodriguez, youth organizer at the Brighton Park Neighborhood Council, part of the anti-TIF coalition.

But in court, Cohen said the city appeared to meet the letter of the law. “I understand there was a rush to judgment, because they understood what the trend was,” he said.

The activists said the subsidy is part of a longstanding pattern in which the city has directed investment to mostly upper-income white communities while bypassing minority areas.

They also said the TIF fails the legal “but for” test for such districts, that is, that private investment would not happen but for the public subsidy.

They called on Mayor Lori Lightfoot to investigate the awarding of the TIF.

Within a TIF district, property tax growth that ordinarily would go to all local governments is captured by the city and used to subsidize private investment, often by picking up the cost of public works that a development requires.

Lincoln Yards TIF help is committed to improving roads, viaducts and the 606 trail, which will connect to the property, Sobota said.