The Chicago City Council may once again turn to controversial tax-increment financing (TIF) to help pay for the redevelopment of the years-dormant South Works property. On Tuesday, the Council’s Community Development Commission voted unanimously in support of pledging $96 million to finance the first phase of a massive overhaul of the former U.S. Steel plant on the city’s south side. If approved by the full Council, the South Works TIF would be the City’s largest ever subsidy of private development.
Chicago-based developer McCaffery Interests Inc. and property owner U.S. Steel Corp. have been jointly planning a sustainable development on the vacant steel mill site since 2005. Funding from the TIF would go towards the project’s 76-acre initial phase at the mouth of the Calumet River. Phase one calls for nearly a thousand residential units and as much as a million square feet of commercial space, totaling around $300 million.
The site is currently home to an apiary managed by Wild Blossom Meadery & Winery, but not much else. Many plans have come and gone since U.S. Steel shuttered the foundry in 1992. The McCaffery plan is the first to really have legs and an infusion of TIF money would certainly give development a needed boost.
TIF subsidies invite polemical debates because they siphon property tax dollars away from school districts and apply them to development and building projects. Critics argue that many of the developments greased with these funds would have gone ahead anyway, amounting to waste, if not abuse, of the public coffers. McCaffery claims that any TIF money given to South Works would all go towards base improvements that would be needed for any development of the site. A dearth of water supply, streets, power grid and other infrastructure requisites, they argue, must be met before the first foundations can be laid.
With or without public funding, construction won’t begin until at least 2013, with commercial tenants moving in the following year. If completed as planned, the entire 530-acre lakefront site would comprise over 13,000 residential units, 17.5 million square feet of commercial space and a 1,500-slip marina. The massive property is comparable in size to the Loop and completion of all phases would likely take decades and billions of dollars.
South Works has an ideal location along the shores of Lake Michigan, but other issues have created not just fallow real estate, but a virtual no-man’s land. Acres of slag left over from the site’s smelting days have made much of the land infertile. The Illinois Department of Natural Resources shipped tons of sediment from Peoria dredged from the Illinois River to act as topsoil.
Many of the plans for improvement of the brownfield are still in their infancy. Some of the proposed green features are a central, walkable business district, wind power generation, integrated public transportation and the return of the streetcar.See All Tags