TIF spending for streets in FY16 did not come anywhere near what DeKalb is claiming

The setup: During the special Committee of the Whole meeting of Monday evening, DeKalb council members were discussing with staff a proposed budget reduction in 2018 for the street improvement program in our two TIF districts, specifically a staff recommendation to cut in half the usual $1 million budgeted for streets in the TIFs. During the course of this discussion, Alderman David Jacobson asked whether the money budgeted in the TIFs for previous years actually got spent. Here’s the actual transcripted exchange:

Jacobson: One other question, only because it was something that was brought up this afternoon to me. I know there was a question last year about– I think it was in the 16-and-a-half budget, if I’m correct, that the council asked for a million-dollar budget in the TIFs for road expenditures, and there was some question as to whether or not that was ever spent?

Public Works Director Tim Holdeman: Absolutely, that was spent. That was in our road program for this year; we have completed that street maintenance, both in TIF 1 and TIF 2 districts. I don’t have the final numbers, but it’s very close to a million dollars. It bid out at about $990,000. So with the engineering, we were right at– we were a little bit above a million, but we could supplement that with Fund 50, so…[crosstalk]

Jacobson: And was that the same in ’16 as well?

Holdeman: For ’16?

Jacobson: The full million for ’16?

Holdeman: Yes, that was the same for fiscal year ’16, yes.

Holdeman’s comments make it sound like the city spent $1 million out of the TIF funds in FY16, another $1 million in FY17, and maybe something in between, during that six-month budget period they call FY16.5. But these claims are not demonstrably true at this point. The FY16 audited numbers are available, and as I reported earlier this year,* the TIF reports filed with the Illinois Comptroller show that not quite $115,000 was spent in the TIF districts on street improvements during FY16 — nowhere near the budgeted $1 million.

The reason? It’s because the TIF street improvement monies were “quietly” sacrificed to give a development incentive to Brian Bemis.

As I’ve explained here*, city staff say changes to the TIF funds don’t require amendments as long as total expenditures for a given budget year don’t exceed the budgeted amounts. Somebody simply decided not to spend the money allocated to streets. That way, they wouldn’t have to put forward an amendment and, more importantly, they avoided the public discussion that such an amendment would require.

What’s a maneuver like that called? Transparency? Best practices? Sheesh.

The city did eventually approve a budget amendment to include streets money into the FY16.5 budget to play catch-up, but of course at this point we’d be fools to take anyone’s word on what they spent. Let’s see the audits for ourselves when they’re publicly available, and put on our skeptics’ caps in the meantime.

Below, I’ve placed a piece of the meeting video picks up the conversation about 33 minutes in, with Holdeman’s claim coming just after the 38-minute mark.

full video is here.

*Previous posts just covered TIF 1 expenditures for FY16, which came to a bit less than $75,000. Total for both TIF 1 and TIF 2 was $114,916.