CHICAGO — A push to “make Michigan Avenue magnificent again” with a special taxing district has stalled after two key aldermen rejected the proposal, disappointing Mayor Lori Lightfoot and Downtown neighborhood leaders.
A business group and city officials worked to create an “emergency” taxing district along the famed retail corridor after the economic downturn caused by the coronavirus pandemic and summer looting. Funds from the district would have boosted the area’s tarnished reputation, supporters said, but Ald. Brendan Reilly (42nd) and Ald. Brian Hopkins (2nd), who represent the impacted area, rejected the plan.
The district, known as a special service area, would have imposed a 0.05 percent tax on commercial properties along Michigan Avenue from the Chicago River to Oak Street. The estimated $742,000 in revenue would be spent within the boundaries on beefed-up security, marketing and streetscaping.
But at the request of Reilly and Hopkins, the Committee on Economic, Capital and Technology Development didn’t vote on the ordinance Monday, making it unlikely the plan could be approved by the full City Council in time for the tax to be levied in 2021.
At an unrelated event Tuesday, Lightfoot slammed Hopkins and Reilly for stalling the plan.
“What you saw is a manifestation of aldermanic prerogative at its worst,” the mayor said. “… The question is to those aldermen who blocked the will of the business community in their wards, who are suffering and hurting and wanted some kind of relief and were willing to tax themselves to do so. What possible legitimate reason could there be [for rejecting it]?”
Kimberly Bares, CEO of the Magnificent Mile Association — the group backing the plan — was among the influential supporters who spoke ahead of the virtual meeting. Unrest and economic struggles Downtown have created a dire situation for retailers on Michigan Avenue, she said, adding that support for the district was widespread.
“The unprecedented support for this additional tax demonstrates the commitment that our property owners have to the avenue and the resources that we need to make Michigan Avenue magnificent again,” she said.
Lee Golub, whose Golub & Company owns Tribune Tower; Grant DePorter, head of Harry Caray’s Restaurants, and other heavy hitters support the plan, which they said would revitalize the “tarnished” Magnificent Mile brand.
But that wasn’t enough to win the support of Reilly or Hopkins, who successfully convinced committee chairman Ald. Gilbert Villegas (36th) to not call a vote on the proposal in defiance of the wishes of the city’s Department of Planning and Development.
Typically, the city requires a lengthy application process to establish a special service area. It can span 12-18 months. But the planning department waived certain requirements, including gathering support signatures from at least 20 percent of affected property owners, to speed up the process.
The pandemic, economic recession and civil unrest all “pummeled” the city this summer, Reilly said, but that doesn’t change his expectations when it “comes to garnering public support for a new taxing mechanism Downtown.”
Reilly said the “truncated” approval process wasn’t transparent and bypassed “checkpoints” meant to protect taxpayers.
“This would be unprecedented, creating a new SSA in the course of five months. What would also be unprecedented is the City Council approving an SSA over the objections of the local aldermen,” he said.
Reilly also criticized the district’s proposed budget, saying a “substantial portion” of the $742,000 that would be raised would pay for operating expenses that would otherwise be paid for with private dues to the Mag Mile Association.
The budget also included $100,000 for “people counters,” which have been useful in the Loop but shouldn’t be a priority right now, Reilly said.
Hopkins also spoke against the proposal, but he committed to supporting the district if the committee hit the “reset button” and allowed the typical special service area approval process to play out.
“There are those who still remain unconvinced this is the right thing to do, and they’re going to be asked to pay for it. In order to establish something like this, you need full buy-in from a wide variety of stakeholders,” he said.
After the meeting, a spokesman for the planning department conceded the special service area won’t move forward in 2021.
The loss is a blow to Lightfoot’s quest to rein in aldermanic prerogative, the unwritten policy of alderman holding broad discretion over issues in their wards.
Lightfoot’s administration has argued the special service area was a necessary response to the economic downturn and summer looting.
Mary O’Connor, deputy commissioner of the planning department, said during the meeting the shortened timeline was created to “address unforeseen and unprecedented events” to “provide immediate funding on a shorter-term basis.”
“Investors in the city look towards the Mag Mile as a pulse check on the Downtown economy,” O’Connor said. “As such, it’s important that we rise to the challenge of the year with rapid action.”
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