by Peter Zelchenko
Hi, everyone. I've been invited to weigh in here.
First of all, I have had a number of discussions with both Brad Leibov and Gina Caruso, first heated and later pretty enjoyable. As I've told them both, when you're standing practically alone against a whole cabal of SSA promoters, feeling like you're howling to the moon, it's easy to lash out a little bit. In private, I was very crude to them (e.g., in the hallway at City Hall). In public, I think I've been somewhat more restrained, and indeed I will make an effort to give credit where it's due.
On Brad's figure of 84% and the mysterious figure of 94%: I stand by them and my sources for them. I did tell Brad that I got the 94% straight from Paula Barrington, director of the Wicker Park-Bucktown Chamber of Commerce, and she attributed the figure to Brad, who told me he does not know where it came from. Since he told me quite sincerely that he didn't remember coming up with that number and that anyone with a brain would see it's absurd, I believe him. But then where did the number come from? Both the 84% and 94% figures may in fact be misinterpretations by chambers of commerce, media exponents, and public officials, easy figures to cite that are too easily restated and too easily misconstrued. That's par for the course throughout SSA procedure: even in my article, where I specifically wrote (and clarified twice to my editor!) the now-famous "51% property owners and 51% voters" rule for overturning an SSA, a copy editor once again screwed it up and made me say it was 51% of only property owners!
Brad acknowledged that his 84% figure was calculated without the level of detail that I used for my own analysis. Brad also explained that wherever the 94% figure came from, it may be a misconstruction of an estimate that 94% of the properties in the area include storefronts, not that they are all commercial properties. I believe him, and I believe I erred in not verifying the Wicker Park figure with him after getting it from Paula Barrington, who attributed it to him. In any event, this kind of extremely rude calculation seems to be based on the notion that any structure with a storefront is counted commercial - including the condos or rental properties above it, and regardless of the tax classification code! That's not meaningful and it's not right!
So, to clarify my position: I doubt that the percent of commercial taxation versus residential could be anywhere near 84%/16% (Lincoln Avenue) and whatever the assumption is in Wicker Park-Bucktown, 94% or anywhere near it. I am saying that if you analyze these areas carefully, and separate out strictly commercial storefront interests from residents (condos, single families, and let's never forget renters) and small offices - interests that arguably have very different priorities from a chamber of commerce regarding street needs - then you will see figures more like 30% commercial vs. 70% residential, which puts the whole tax, and the chamber of summarizes steering of the process, into serious question.
Someone wrote above that "Leibov disputed the statement and claimed that his assertion was only that townhomes and residential condominiums would contribute 20% of SSA levy." He may have said that, but it can't be right. Whoever wrote that also added, "Zelchenko's analysis confirmed this." That's not true either - my analysis showed that probably something close to the opposite may be true: commercial interests may pay as little as one-third of the SSA levy! Clearly, Brad and I have very different analyses. That's a problem that I feel must be resolved before we proceed even with selecting commissioners.
What I've come up with is nowhere near the figures that have been bandied about, and I maintain that it's irresponsible of anyone involved in the process to throw numbers around without exquisite clarity, or without a much more careful analysis. My feeling was, and remains, that the public was misled - and I'm not so concerned whether it was deliberate or incidental: it's a mistake that must not be tolerated by policymakers entrusted with public responsibilities.
What I see on Lincoln Avenue and Wicker Park-Bucktown are similar problems that require similar action: there was very little we could do to stop the SSAs, so they passed. Therefore, we need to do what we can to make the best of it. In the short term, residents must speak out (now!) and contact the aldermen (Matlak, Flores, Daley) to tell them to ensure the SSA commissions are populated with residential representatives proportionate to the percentage they are paying into it (based on a VALID analysis). If my numbers are right, that should mean residents will be entitled to the majority of commission seats. I spoke to Daley about this, and on Wednesday I tried to persuade Flores - but he has his own ideas on the question of burden/benefit as I've described it, and it may be a struggle to get him to see the light. Others need to come forward and persuade him.
Secondly, I'm trying to work with Brad and Gina on what I referred to as "SSA Version 2.0", which can best be described as a "multivariate SSA". Brad has told me, and I've discussed it with Gina and seen it in the statute: ad valorem property tax is not the only measure that can be used to assess burden. In fact, it seems one can use any variable that is measurable. For Lincoln Avenue and Wicker Park-Bucktown - and other SSAs that are on commercial streets and were originally called for to address commercial needs - I think a better tax would be one based on as many as three figures: EAV, sales tax, and liquor tax: a single-family homeowner or resident pays a very low-scale figure, a non-liquor restaurant pays a medium-scale figure, and a big bar pays a high-scale figure. In theory, this is doable.
Is there a need for me to antagonize Brad or Gina? No. I want to be their friend. I want to make things work, and believe it or not these people are not evil, they're trying to do right - they simply need to tune their sensitivity a little better toward the multiple interests, and to accomplish that we need to help them. If you want to agitate, that's fine too, but I've soft-shoed this and am making good progress: we're ready to roll up our sleeves and hack the problem in a civil way. They're the city's two top experts in this area, and they also are residents. I think it can work. Want to join us?
There is also a more global need regarding SSAs: since the SSA statute's use has moved from a basic public utility benefit use to a new aesthetic, promotional, and special initiatives use that often crosses special interest boundaries, it is important to lobby to get the state statute changed from enabling (51%+51% to defeat) to restrictive (51% voter referendum + % business petitions to pass). I believe something like this was attempted in vain recently outside the city, but we are now developing a strong (potential) testimonial force to call for it from within the city. We need to pool our resources to do this (see below).
I have made no public representations about DevCorp, but I have spoken with some of you 49th Warders and am myself suspicious of their motives and how it seems they may be using public funds for private ends. I haven't read all of the history. I don't know who Kimmy Bares is.
Here's what I think Rogers Park should do: You need to get your top watchdogs (Hugh, Craig, etc.) in contact immediately with Jackie Leavy of the Neighborhood Capital Budget Group, at jleavy@ncbg.org. She is leading a new Accountable Development Task Force which deals with TIFs and other tax issues and I'm pressing for an SSA subcommittee. This will be an excellent forum for outreach and action. The first meeting is January 17, so please get on her list as soon as possible. I've already recruited people from the Roscoe Village area, Wicker Park-Bucktown, and Lincoln Avenue. If you know of any other areas that need to connect up and pool our intellectual resources, I urge you to get their contact information to me or Jackie and inform them of the group.
10 comments:
Uh, Just the Facts, I think that Peter realizes that it's a lost cause and the best he can hope for is to reduce the tax burden on residential and lower revenue small businesses. In other words, he's learned the painful lesson that fighting the tax will get him iced and is effectively a losing battle so his only possible alternative is to serve the resident/small biz special interest. Of course, lined up against him is the bigger biz, bar owners, restaurants, etc.
Sadly, Chicago is run as an oligarchy. The only way to not be on the losing end is to become a force large enough that the oligarchy must heed it, thus effectively becoming part of the oligarchy. I think this is what selling out looks like.
Dingoes don't kill babies,
dingo OWNERS kill babies!
> ... it's more productive to get involved ...
Thanks for the call to action.
Will you favor us with another incisive transactional analysis of a cocktail party? Thanks again!
Do you remember when you were kids and you decided to play war. You'd find some sticks and pretend they were guns. One team would line up against the other and you take shots at each other from behind a tree or a rock. Then you'd go running at each other. It all seemed like a lot of fun until one kid got whacked over the head and started screaming or bleeding.
That's kind of what this blog is all about. A bunch of phoney pretenders. You play imaginary war games against the establishment.
First, you yell and scream because there isn't enough of the development you want to see. And blame all the injustices of the world on some evil cabal.
Second, even if a developer comes around with a great plan you howl like a bunch of babies because it means change and change, no matter how much you scream for it, will never live up to your silly expectations. You hold out some of these old buildings that are falling apart as if they are some kind of holy grail that put's historicness on a plain above common sense.
Third, you want a better class a neighbors, but ooooh, if there's a building going condo, its bad. You neglect to see that investors have to make a profit if you want any kind of decent investment in your community.
Fourth, you dream up imaginary conspiracies and support them with unfounded claims, that if were true would at least make some headlines in the mainstream media.
Paradise has obviously never visited the Cook County Assessor's office page. If he'd done so he'd see that on a square footage basis, single family homes pay more tax than apartment buildings.
But you need to find some kind of axe to grind about SSAs now, because it's much easier to sit on the pitty pot and whine.
Fifth, you'd rather burn bridges than build ones because the latter choice takes work.
Hugh wrote: Will you favor us with another incisive transactional analysis of a cocktail party?
OHMYGOODNESS! I can't decide whether I should be LMAO or afraid, very afraid. What baffles me mostly, though, is when Westgard works. He writes these LONG posts to hig blog(s) and to this blog. And all these letters to the editor and various politicos. And he does etiquette. So multi-talented. But I digress.
Peter has no choice but to sell out. It's sad, though, that our choice is between being iced out or selling out. A society that develops policies, taxes, laws, and regs that are a bizarre mishmash of benefits to some and reduced penalties to others will result in programs that largely benefit the bureaucrats and contracteds who run them. Meanwhile, the rest of us pay for it. SSAs, in general, are a ROTTEN idea. No SSA ever improved a community's economy. All they do is make streets look prettier at great cost to those who fund them. Capital, like anything else, is a limited resource. Every dollar a taxpayer gives to X is a dollar not available for Y.
Alderman Moore is correct when he states that free markets determine the nature of business in a community. Free markets might be helped along by providing an environment that is safe for business to conduct itself. I've yet to meet a planter or street sign that made anyone safe, though. $4M planters will not make Morse safe. Business will not come if it's not safe for their customers. No SSA can change that.
That said, a well run SSA might be tolerable in a 4th circle of upper hell kind of way.
Hugh, thanks for bringing TW's "transactional analysis" to my attention. I didn't realize quite what a brilliant satirist TW is. Reishi mushrooms! I can't stop giggling over that!
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