Bears deal will be a top priority for lawmakers upon return

Legislators face enormous pressure to finalize a megaprojects bill that would spell disaster for taxpayers.

A last-ditch effort to keep the Chicago Bears in Illinois will likely be one of the top priorities when lawmakers return to Springfield on April 7. 

Bears leaders want to finish their search quickly and hope to have the site operational by 2030. NFL Commissioner Roger Goodell said March 31 that the Bears need to “find a solution for a stadium” and that the deal needs to be done “relatively soon.”

Arlington Heights Mayor Jim Tinaglia says the deal needs to be done “ASAP,” likely hoping the Bears choose his suburb over Hammond, Indiana.

Gov. J.B. Pritzker has said he supports Illinois assisting with infrastructure costs.

Negotiations in the General Assembly have centered around property tax breaks for new “megaprojects,” which would include a new Bears stadium.

The proposed incentive package, HB 910 House Amendment 1, would be devastating for Illinois’ property tax crisis. A rushed negotiation process and the intense pressure from special interests could be disastrous for taxpayers.

While negotiating targeted tax incentives is bad policy to begin with, the legislation would make Illinois’ property tax crisis even worse for other taxpayers. Although approved megaprojects would pay steeply discounted property taxes, a clause in the bill allows a taxing body to count the cash value of the megaproject in its total assessed value.

In other words, taxing bodies can still increase taxes as if the project were paying normal tax rates, generating increased revenue, but the project would not pay those higher taxes. Neighboring businesses, homeowners and renters would pay more to make up for the team’s discount.

Here is some of what’s in the bill, which has passed out of committee:

• To qualify, a project must have at least $500 million in eligible costs, which can include the property purchase and can be retroactive up to five years before the megaproject certificate is issued. The project must be completed within seven to 10 years, but that can be extended by five years. The site must be operated for at least 20 years; the tax incentive would last at least 23 years and up to 40 years.
• The megaproject’s assessment would be frozen so that its property tax bill is calculated on the “base year” of the project, meaning the value of the property before any improvements, such as a stadium.
• However, for purposes of issuing bonds and property tax extension limitation calculations, the taxing body could use the current fair cash value of the property. In other words, new development, which is generally exempt from Property Tax Extension Limitation Laws, would allow for the levy to grow beyond the limited rate. Other taxpayers would have to cover that.

The bill’s “incentive agreement” allows for separate payments from the megaproject entity, such as the Bears, or an alternative source, to affected taxing bodies in addition to property taxes. The payment amount would be negotiated with taxing bodies.

Illinoisans already pay the highest property taxes in the nation. Homeowners in Arlington Heights pay average annual property taxes of more than $8,000.

HB 910 would make the situation even worse for Illinois property taxpayers. One simple solution is to strike this language from the bill:

“Projects to be valued at fair cash value for purposes of bonded indebtedness and limitations on property tax extensions. Projects to which an assessment freeze applies pursuant to this Division shall be valued at their fair cash value for purposes of calculating a municipality’s general obligation bond limits and a taxing district’s limitation on tax extensions.”

Removing that language would ensure that businesses, homeowners and renters in the megaproject area would not face higher property taxes because of an incentive agreement.