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Bronzeville, Near South Side

TIF Subsidy For ‘The 78’ Development Faces Next Hurdle As 25th Ward Hopefuls Call For Delay

Developers of a project so large that it's been dubbed Chicago's newest neighborhood are on their way to securing a $700 million TIF subsidy from the city.

The massive 62-acre development knows as "The 78."
Related Midwest
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SOUTH LOOP — The monthly meetings of the Community Development Commission are usually sleepy affairs that feature nothing more exciting than members appointed by Mayor Rahm Emanuel approving new tax increment financing districts and city owned property sales already blessed by Emanuel.

Tuesday’s meeting scheduled for 1 p.m. at City Hall will be the exception to that rule.

Alex Acevedo, one of five candidates vying to replace 25th Ward Ald. Danny Solis, told reporters at City Hall that the commission should delay the vote. It is the second step in a four-part approval process that will culminate with a vote by the full Chicago City Council, perhaps as soon as March 13.

There should be a full investigation of whether Solis — whom the Sun-Times reported traded sex acts, Viagra, free weekend use of an Indiana farm once owned by Oprah Winfrey and a steady stream of campaign contributions for City Council actions — acted corruptly when he fast-tracked the development (O2018-4455) approved by the full City Council in December, Acevedo said.

“Alderman Solis put his personal and political interests above the interests of the people at every turn,” Acevedo said. “Did he have plans to get kickbacks from this project? We need answers first. In light of the serious allegations against Alderman Solis putting his political cronies and personal interests above concerns of 25th Ward residents, I am demanding this project be put on hold until a thorough, independent investigation can be conducted.”

Acevedo also reiterated his call for Solis to step down immediately, and told reporters he has no specific knowledge of corruption in connection with The 78 development.

Candidate Hilario Dominguez, who has also called for Solis to resign, said the measures should be put in place to prevent gentrification from forcing out longtime residents.

“We simply can’t provide money to a developer until we know that the families who have lived in the area for decades won’t be displaced,” Dominguez said. “In light of the recent reports regarding how Alderman Solis has operated his government office, we need to reevaluate any projects that he has been involved in.”

Candidate Byron Sigcho Lopez said the development “will undoubtedly change the landscape of the 25th Ward” and joined Acevedo’s call that the vote be delayed until “a full independent probe” can be conducted.

“Given recent revelations of the scope of Alderman Solis’ flagrant misuse of the powers granted to him in as chairman of the Zoning Committee, it would be negligent to allow the proposed development to proceed any further,” Sigcho Lopez said.

The 15-member commission is expected to green light plans for the new 141-acre Roosevelt/Clark Tax Increment Financing Redevelopment Area (F2018-71) that would generate $700 million to build the infrastructure necessary for Related Midwest’s “The 78” development between the South Loop and Chinatown.

Aldermen gave developer Related Midwest approval to rezone the 62 acres along the Chicago River to DX-5, Downtown Mixed Use District. The change allows Related to build as many as 10,000 apartments and condominiums in the development, whose name is meant to signify the massive development adding one new neighborhood to Chicago’s existing 77 community areas.

“This development is the big enchilada for my entire ward,” Solis said of the development. It was one of 10 sites Chicago officials pitched unsuccessfully to Amazon as the tech giant searched for a home for its second headquarters.

If the project receives TIF funding — and 10,000 new units are built — developers would be required to set aside 2,000 units for low- and-moderate income Chicagoans, according to the proposal.

The $7 billion mixed-use project is expected to create 24,000 jobs.

As part of a negotiated agreement backed by planning officials and Solis, Related Midwest agreed to set aside 500 units on site as affordable, and pay a $91.3 million fee to the city’s Affordable Housing Opportunity Fund in lieu of adding another 500 on-site units.

City officials will allow the remaining 1,000 units to be built off-site. Half of those units — 500 — must be built in Pilsen or Little Village, according to the agreement. The other half must be built within two miles of the project, officials said.

That requirement will help fuel the creation of affordable housing in the rapidly gentrifying Pilsen and Little Village area, Solis has said.

When the new TIF was endorsed by the Joint Review Board on Jan. 11, the vote was greeted with chants of “shame!” and one man told members of the board that they had just voted to “destroy our community.”

The new TIF must also be approved by the Chicago Plan Commission and the Chicago City Council.

Ald. Pat Dowell (3rd) objected to the inclusion of the area east of Clark Street in the Roosevelt/Clark TIF as well as the location of the CTA Red Line station at 15th and Clark streets, “right in the middle of an established, entirely residential area” between the Roosevelt stop and the Cermak-Chinatown stop.

Dowell has said she prefers the stop on the west side of Clark.

Department of Planning and Development Commissioner David Reifman said the $500 million from the newly created TIF will be needed to build a new CTA Red Line station, relocate and enclose Metra tracks, build a new Taylor Street bridge and extend 15th Street.

The project will pay $26.3 million into Neighborhood Opportunity Fund in exchange for the right to build a more dense development than otherwise allowed by city rules. The city uses that fund to award grants to businesses on the South and West sides.