Writing

History repeating: Chicago aldermen who opposed food trucks now seek to restrict operations for food carts

by Hilary Gowins, posted in huffington post

Originally published on Huffington Post.

Less than a day after Chicago lifted its ban on food carts on Sept. 24, city aldermen with a history of limiting the city’s food options made moves to restrict vendors’ ability to operate in lucrative locations.

Two aldermen have launched proposals to limit where food carts can set up: Alderman Tom Tunney, whose ward covers the Wrigleyville neighborhood and who formerly owned restaurants of his own, and Alderman Brendan Reilly, whose district encompasses River North and many of the city’s most well-known brick-and-mortar dining spots, are leading the charge.

Food carts should be a boon to Chicago neighborhoods, with the potential to bring up to 6,400 new jobs and create more than $8 million in new local sales-tax revenue. Unfortunately, the hardworking food-cart vendors who fought so long for the city to recognize their industry now operate at the mercy of all-powerful local aldermen, many of whom use their authority to grant political favors and keep out businesses they don’t like.

Chicago’s more than 1,500 food-cart vendors are primarily Latino and serve low-income neighborhoods where food options are often scarce. They are a beloved part of their communities – kids pick up elotés for after-school snacks, walkers grab champurrado on cool mornings and anyone looking for a delicious lunch knows vendors’ tamales won’t disappoint.

Now that Chicago has lifted its ban on food carts, there should be no restrictions on where vendors can operate. City Council’s Sept. 24 vote to legalize the industry was a huge victory for the small-time entrepreneur – it would be a mistake to walk it back.

But the move isn’t surprising. History has shown Chicagoans where Tunney and Reilly stand when it comes to culinary competition.

Even though the city does allow food trucks to sell, aldermen imposed severe restrictions on how these businesses can operate. Food trucks can’t set up shop within 200 feet of a restaurant. To enforce this rule, the city requires food trucks to install GPS tracking devices. Vendors must stay in one location for no more than two hours, and there are just 35 designated “food stands” in which food trucks are allowed to park.

Tunney and Reilly were among the chief proponents of heavy restrictions on food trucks when City Council considered the topic over the last several years. Tunneymade no secret that the main reason behind the city’s oppressive rules is to protect established businesses.

“One of the major issues is spacing from brick-and-mortar restaurants,” Tunney told the Chicago Sun-Times in 2011. “We’ve got work to do. We need to hear from all sides. We need to make sure we protect … restaurants and foster a trend that, I think, is gonna be here for a while.”

Tunney was right about one thing: Despite heavy regulations, food trucks are thriving in Chicago. These mobile vendors have become immensely popular among the thousands of workers looking for variety in their lunch options downtown. Trucks like La Cocinita, The Jibarito Stop and Boocooroux bring new flavors and choices to diners, in a location where brick-and-mortar chains used to dominate. Now that City Council has unleashed food carts, there’s no reason to doubt that these vendors will receive a warm reception from diners across the city.

But Tunney is dead wrong when he says the city must “protect” restaurants. It should be left to hungry Chicagoans – not all-powerful Chicago aldermen – to determine where vendors take their talents.

Chicagoans hungry for food carts

by Hilary Gowins, posted in op-ed

Op-ed published in the Chicago Sun Times.

Hours before restaurants open their doors in Little Village, Claudia Perez sets up her cart along 26th Street or one of the side streets nearby.

Claudia is 62. She came to the United States from Mexico in 1995. For more than 10 years, she has been selling tamales, elotes and horchata out of her food cart to support her family. It’s hard work: She’s up most mornings before the sun preparing batches of what she’ll sell that day. Come rain or shine or snow, Claudia is out in the neighborhood, serving hungry people as they head to work.

Claudia is one of nearly 1,500 food-cart street vendors in Chicago. But the city doesn’t welcome the flavors she provides her community.

The City Council is likely to vote in September on an ordinance to finally recognize food carts in Chicago, putting food carts on a level playing field with other food options in the city, such as food trucks and brick-and-mortar restaurants. It would also help ensure the industry is safe – vendors would have to meet citywide safety standards and prepare food in a licensed kitchen. They would also be subject to inspection by the health department.

The Illinois Policy Institute surveyed 200 food-cart vendors across the city, learning what their lives and businesses are like. This research uncovered something long suspected: Food carts could be a boon to Chicago.

Chicagoans already love food carts – vendors serve as many as 50,000 meals per day.

Vendors know this. If Chicago recognizes the industry, 79 percent of the vendors surveyed said they would expand their business to capitalize on the high demand that already exists.

The City Council should take note. Chicago is one of the only major U.S. cities that bans food carts; these businesses are recognized in 23 of the 25 largest cities in the country. If the city embraces food carts, it could see up to 6,400 new jobs and up to $8.5 million in new local sales-tax revenue. This is an easy way to provide additional revenue for a city staring down a billion-dollar budget deficit while helping some of the areas in the city that are hurting the most.

Neighborhoods from Little Village to Humboldt Park to Avondale already are home to hundreds of vendors. These communities rally around food-cart culture – kids pick up elotes for an after-school snack, walkers grab champurrado on cool mornings and anyone looking for a delicious lunch knows vendors’ tamales won’t disappoint. People drive from hundreds of miles away to get a taste of Chicago’s food-cart fare.

It’s time for the city to recognize this burgeoning industry. Embracing food-cart culture means more revenue for the city and greater access to food throughout Chicago’s neighborhoods. It also means more opportunity for people who want to work hard and make a living as food entrepreneurs.

It’s the right thing to do.

Rehabilitation, Restitution Undermined by Illinois’ Supersized Criminal-Justice System

by Hilary Gowins, posted in huffington post

Originally published on Huffington Post.

Too often, corrections programs focus solely on locking up offenders and throwing away the key … until their sentences are completed, at which point they are expected to become productive members of society.

This model serves no one: not the taxpayers who foot the bill for jails and prisons, not the people who serve time behind bars, and not the victims of crime and the public.

An ideal corrections program focuses first on keeping the public safe. Public safety depends on crime prevention, which means that an effective corrections program is one that isn’t simply punitive, but is transformative, aimed at stopping the cycle of crime in which the same people end up behind bars again and again.

Unfortunately, Illinois lags behind other states in its efforts to curb recidivism through offender rehabilitation, and the results are sobering: Offenders who serve time in Illinois prisons have a nearly 50 percent chance of returning within three years.

By not implementing enough effective offender-rehabilitation programs, the state jeopardizes public safety.

Illinois should look to successful programs in other states for guidance on recidivism prevention. One way to rehabilitate inmates convicted of nonviolent crimes – those who are serving time for offenses such as burglary, fraud and drug crimes, and make up 50 percent of all inmates in the custody of the Illinois Department of Corrections, or IDOC – can be seen in an impressive program in the Lone Star state.

In Texas, the Bridges to Life restorative-justice program has been in operation since 1998. Under programs like Bridges to Life, if the person found guilty of a nonviolent property crime and the victim of that crime agree, the two parties enter mediation to work out terms that allow the guilty party to repay the victim in lieu of serving jail time. Victims, who often take a back seat in the design of punishment-focused criminal-justice policies, report greater levels of satisfaction under such restorative-justice programs, according to research from Right on Crime.

This one reform – establishing a restorative-justice pilot program in Illinois – could save an estimated $780,500 in one year. Given that IDOC spending is at an all-time high ($1.4 billion in fiscal year 2015) the state must seize every such reasonable opportunity to reduce its prison costs.

Illinois’ prison population has increased by 330 percent since the 1970s. If the state is to meet Gov. Bruce Rauner’s goal of reducing its prison population by 25 percent by 2025, politicians need to get serious about embracing changes that address the state’s ever-growing incarceration problem. Restorative justice and other programs are one way to accomplish this goal, while at the same time ensuring that Illinois’ criminal-justice system is focused more on restitution and rehabilitation than on punishment alone.

An easy win for Chicago: Legalize food carts already

by Hilary Gowins, posted in op-ed

Op-ed published in Crain’s Chicago Business.

Chicago leaders are wringing more revenue out of taxpayers who use cellphones, watch Netflix, own property and buy locally via increased taxes and surcharges in a desperate attempt to plug an expected billion-dollar budget deficit.

But there’s a way aldermen can raise revenue and do something good at the same time: legalize street vending.

Do this, and Chicago could welcome more than 6,400 new jobs. It also could generate up to $8.5 million in new local sales tax revenue, according to original analysis by the Illinois Policy Institute.

Chicago lags behind when it comes to this burgeoning new industry. Street vending from food carts already is legal in 23 of the 25 largest cities in the U.S. And despite the city’s ban, Chicago already is home to a vibrant street-vending community. An estimated 1,500 vendors serve 50,000 meals per day—primarily in lower-income communities such as Little Village, Back of the Yards and Humboldt Park.

The 200 vendors surveyed by the institute all were Hispanic; nearly 80 percent are middle-aged; more than half are women; and 95 percent work to support at least one dependent. Their elotes, champurrado and tamales are famous for miles around.

The institute’s economic experts project that street-vendor take-home pay could grow by up to $60 million if the city voted to legalize street vending. Seventy-nine percent of vendors surveyed by the institute said they would expand their business if the city legalized street vending, and 64 percent of vendors said they would add more carts.

VOTING IN SEPTEMBER
An ordinance to allow food-cart street vending sits before the city’s Committee on License and Consumer Protection. Aldermen are expected to vote on the measure in September. The ordinance would expand the city’s existing frozen desserts ordinance to include prepared-food carts and would require vendors to prepare food in a city-licensed kitchen. Vendors would be able to acquire a license from the city for $350.

Mayor Rahm Emanuel has said ensuring access to good food is a priority. In July, he secured a one-year federal grant to run produce buses in neighborhoods considered food deserts. In 2014, the city issued its first “emerging business permit” to allow a local nonprofit to open healthy-food kiosks in the Loop.

But city officials don’t need to do anything fancy to increase food options. Legalizing food-cart street vending would ensure access to healthy, safe food for neighborhoods across Chicago and would open the door for residents to earn a living doing what they love. It wouldn’t hurt Chicago’s pocketbook, either.

Why the White House Is Opening Up About Occupational Licensing

by Hilary Gowins, posted in huffington post

Originally published on Huffington Post.

Abuse of occupational licensing schemes has become such a serious problem thatthe White House has taken notice. On July 28, the White House Council of Economic Advisers issued a nearly 80-page report outlining the many problems with occupational licensing in the states, adding one more piece of evidence in the annals of research proving just how harmful these regimes have become in the U.S.

It’s not just doctors and lawyers who need a license to work. More than 1,000occupations, such as upholsterers and hair braiders, are subject to regulation in at least one state across the country. Twenty-five percent of the workforce needed to obtain a license to work as of 2007; that number stood at just 5 percent in the 1950s.

Why is this growth so dangerous?

• It becomes more difficult – and more expensive – to enter the workforce as occupational licensing becomes harsher and more prevalent. For example, all 50 states require cosmetologists to have a government license to operate. In West Virginia, cosmetologists must go through 467 days of training and pay $185 before they can receive a state license to operate legally, according to a report from the nonpartisan Institute for Justice. These kinds of hoops affect the number of people who pursue careers in cosmetology. According to Kenyon College economistsDavid E. Harrington and Kathy J. Krynski, 100 hours of additional required training reduces the number of Vietnamese manicurists by almost 18 percent. These burdens inevitably harm low-income workers the most.

• Goods and services cost more for customers, even though quality doesn’t always improve. The Federal Trade Commission issued a report in 1990 that found occupational regulations frequently increase prices and impose significant costs on consumers without improving the quality of professional services. This can cause a “Cadillac effect,” where people either pay a higher cost for services or refuse to consume the service at all – which can bring about life-threatening consequences. For example, research from Sidney Carroll and Robert Gastonshows that stricter licensing requirements for electricians reduces the number of electricians in a given area, and that areas with a lower density of electricians are home to higher levels of accidental electrocution. The findings suggest homeowners without access to cheaper options attempt to do electrical work themselves, with tragic results.

These are just a couple of the side effects of poorly written and unnecessary licensing laws that are harming workers and consumers under the guise of protecting public health and safety.

As the White House report points out, licensing schemes are inconsistent in numerous ways, with some states imposing strict regulations on a profession while others don’t require licensing at all.

For example, only three states – Florida, Nevada and Louisiana – impose harsh “practice acts” on interior design, limiting who can pursue the profession. To become licensed in these states, prospective designers have to pass the National Council for Interior Design Qualification, or NCIDQ exam. Before you can sit for the test, however, you must have a degree in interior design, complete an internship for two to five years (or more) and pay $1,265 just to take the exam. These time and cost constraints price people out of the market, but in the rest of the country interior designers don’t face such strict barriers to work.

In addition to the variation in policy state to state, licensing requirements don’t always make sense from position to position. In Wisconsin, becoming a cosmetologist takes 15 times the amount of training that it takes to become an emergency medical technician, or EMT, according to the Institute for Justice. Nationwide, cosmetologists spend an average of 372 days to get a license, whereas the average EMT spends just 33 days. This example also shows that the rules for each profession don’t match up with the level of safety required to perform the job well.

“Fundamentally, licensing affects who takes what job,” the White House report authors wrote. “If licensing places too many restrictions on this allocation of workers, it can reduce the overall efficiency of the labor market. When workers cannot enter jobs that make the best use of their skills, this hampers growth and may even lessen innovation.”

Not everything in the White House report is praiseworthy – the authors suggest that, in some instances, regulations that promote better-educated professionals are good (the example the report cites is accountants). In reality, however, continuing-education requirements are best left to professionals and the businesses that hire them. Degree inflation has already kicked out the ladder of economic opportunity for many Americans who formerly had access to occupations that now require a postsecondary education, regardless of whether the skills learned in college are applicable.

Overall though, it’s commendable that the White House has taken up the cause of reducing barriers to entry for people who want to make a living in the job of their choice. States should take the time to reexamine the licensing laws on their books, profession by profession, and be honest about whether the rules benefit the many (consumers and workers) or the few (special interests who gain from decreased competition).

Buyer Beware: Property Taxes in Chicago Only Going Up

by Hilary Gowins, posted in huffington post

Nobody buys a house without checking the fine print: What’s the crime rate in the neighborhood? How are the schools? What was last year’s property-tax bill?

For prospective buyers in Chicago, what’s missing from the equation is how much property taxes will go up in the future.

It’s not a good time to invest when the bottom’s falling out, and the foundation is slowly crumbling beneath the city of Chicago, which has a more than $34 billion pension-debt problem.

In spite of the city’s dire financial straits, however, Chicago realtors are experiencing a boom this summer, as prices are rising in the city and good listings are moving within a matter of days.

With average rent at nearly $2,200 per month, many Chicagoans in their 20s and 30s are opting for a mortgage instead of a lease.

But anyone thinking of investing in property in Chicago should read this disclaimer: Your taxes are going to skyrocket in the next few years, and, for the most part, your money will be going toward debt payments and pensions, not city services.

Illinois homeowners already face the second-highest property tax burden in the country, according to the nonpartisan Tax Foundation. Property taxes in the city are relatively low compared to those in the suburbs, though property taxes in the city went up by an average of $90 in 2014 according to Cook County Clerk David Orr. Property taxes on a home worth $199,000 totaled more than $3,300.

Property taxes are sure to continue rising in the city, with one main driver: public pensions.

For years Chicago has pushed off the harsh realities of its mounting pension debt in lieu of continuing to operate as if the problem didn’t exist.

But that approach is starting to come apart at the seams.

Chicago Mayor Rahm Emanuel is floating a proposal to increase property taxes by$175 million over one year just to pay for contributions to the teacher pension system, which is $9.6 billion in debt and has less than $0.50 for every dollar needed to pay out benefits.

Chicago Public Schools, or CPS, faces a $1.1 billion deficit for fiscal year 2016. CPS just made good on a $634 million payment to the teachers’ pension fund byborrowing and making stark cuts: more than 1,000 workers will lose their jobs and the CPS budget will be slashed by $200 million. Unfortunately, these cuts are par for the course for CPS over the past several years. In 2013, CPS closed 50 schoolsand laid off nearly 3,500 teachers and staff.

But teachers aren’t the only ones who get pensions in Chicago.

The pension fund for Chicago firefighters has $3.1 billion in pension debt, and just $0.24 of every dollar needed to pay for benefits.

The police pension fund has $6.9 billion in debt and less than $0.30 of every dollar needed to pay benefits.

All in, Chicago owes $34.5 billion in pension debt. That breaks down to $33,500 per Chicago household.

Where will the city turn to get out of this hole? Likely, officials will try to continue totake on debt, though this will become a much costlier option, given the city’s junk rating and extreme debt levels. That means the city will be more likely to hit up homeowners, and Emanuel’s one-year, $175 million property-tax increase proposal is just the beginning. An April 2015 study from Nuveen Asset Management revealed Chicago would need an aggregate property-tax increase of well over 50 percent for Chicago government to start tackling its pension crisis.Another estimate pegs the property-tax hike at 60 percent. Analysis from Crain’s Chicago Business suggests that property taxes could go up by 30 percent this year alone.

At the same time the city’s obligations are skyrocketing, its population is growing at a snail’s pace, gaining just 82 residents in 2014. With 2.7 million residents as of 2014, Chicago’s population is the same as it was in 1920.

City leaders are in a bind: Raising revenues on a stagnant tax base is a risky game. Drive any more residents out to greener pastures and that tax base will begin to shrink. This was the nail in Detroit’s coffin.

Big changes to the way city government operates are necessary if Chicago is to dig itself out of this hole. Ending special property-tax carveouts is one good place to start. Emanuel announced plans to freeze seven tax increment financing, or TIF, districts, freeing up $250 million over the next five years, according to the Chicago Sun-Times. TIFs use a portion of property-tax revenues generated in these special economic zones to give tax incentives to private developers located in these districts. Since 1986, Chicago has collected $6 billion in TIF funds, according to the Cook County Clerk. That’s $6 billion in a slush fund to subsidize private development projects, not school, park and library districts.

Sunsetting TIFs and uncovering hidden wealth won’t be enough, however – Chicago will need serious structural overhauls to end its pension bleed. Otherwise the city’s pension monster will eat Chicago alive.

Chicago Now Home to the Nation’s Highest Sales Tax

by Hilary Gowins, posted in huffington post

Originally published on Huffington Post.

Buying local just got a lot less appealing for Chicagoans.

The city reclaimed the highest sales-tax rate in the nation on July 15, when the Cook County Board, which oversees Illinois’ largest city, voted to raise its portion of the sales tax, bringing Chicago’s combined rate to 10.25 percent from 9.25 percent.

Chicago is now right back where it was in 2008, when the county raised its rate to 1.75 percent from 0.75 percent (the same leap as the 2015 increase).

Former Cook County Board President Todd Stroger hiked the sales-tax rate in 2008, and lost his re-election bid to current Board President Toni Preckwinkle in 2010. Back then, Preckwinkle benefited from momentum against Stroger’s unpopular tax hike, which she ultimately peeled back. But her quick about-face shows Chicago politicians increase and decrease the sales-tax rate as it’s convenient.

A sales tax is one of the most transparent ways for government to raise revenues, but it doesn’t exist in a vacuum. Chicago imposes its sales tax on top of myriad other taxes residents pay, including property taxes, and other taxes and fees.

Mayor Rahm Emanuel has also revealed a plan to increase Chicagoans’ property taxes by $175 million over one year to cover city debt.

Unfortunately, other factors make it expensive to live in the city, as well. Illinois has the highest cellphone taxes in the nation. In July, City Council passed a 56 percent increase on the city’s cellphone surcharge, adding an additional $84 in taxes each year for a family of four with four cell phones and a landline. In 2013, City Council raised the tax rate on cable to 6 percent from 4 percent – the city is raising the rate again, this time all the way up to 9 percent, costing Chicagoans an extra $12 million in taxes, according to the Chicago Sun-Times. Now the city is foisting an additional 9 percent tax on online streaming services such as Netflix.

Property taxes, surcharges and entertainment taxes are all methods City Council has been using repeatedly as a method to drum up revenue to fund the city’s financial problems. But Chicago’s population is growing at a snail’s pace, gaining just 82 residents in 2014 after a decade of population decline.

Chicago leaders can only squeeze so much out of the city’s remaining residents.

Don’t Be Fooled By ‘Taste’ – New Flavors Are Frowned Upon in Chicago

by Hilary Gowins, posted in huffington post

Originally published on Huffington Post.

Chicago likes to shackle food-truck operators.

Food trucks can’t operate within 200 feet of a brick-and-mortar business that sells food. Food trucks must have a GPS tracking device so government officials know where they are. Food trucks can only sell food in 35 city-approved, specifically designated locations.

But from July 8-12, 60 vendors will serve food from stands – outside, from carts, tents and trucks at the city’s 35th annual Taste of Chicago.

Most of the vendors are brick-and-mortar restaurants, such as The Purple Pig, Lou Malnati’s and Billy Goat Tavern & Grill. Fifteen food trucks, some of which also have a brick-and-mortar presence, will be at the food festival as well.

Though brick-and-mortar restaurants and food trucks will be comingling at the festival, their relationship remains tumultuous.

In 2012, the city approved restrictive new rules that limited proprietors’ ability to do business in the city. A year later, Emanuel joined the Food Network on its show“The Great Food Truck Race” for an episode titled “Chicago is a food truck kind of town.”

“We remain committed to creating the conditions and opportunities that will allow this industry to thrive, create jobs and support a vibrant food culture across Chicago,” Emanuel said in a 2013 statement.

Rahm’s words don’t line up with the consistent actions he and other city leaders have taken for years. The truth is, Chicago isn’t a food-truck town – it’s a special-interest city, where political connections reign supreme and organic innovation is seen as a nuisance that would upset the established order of things.

Those backing the city’s restaurants make no secret that the main driver behind the city’s oppressive rules is to protect established businesses.

Alderman John Arena, 45th Ward, who cast the only “no” vote on the 2012 ordinance, said: “A brick-and-mortar restaurant lobby got ahold of [the ordinance], and it was stuffed with protectionism and baked in the oven of paranoia.”

So while Rahm’s words describe a city that welcomes food-truck innovation with open arms, his actions prove the city wants to keep the industry on a short leash.

“Opening and operating a food truck in Chicago is somewhere between difficult and impossible,” said Robert Frommer, an attorney for the Institute for Justice. “The city has put together a menagerie of rules that seem almost intended to make it as hard as possible to open up and be successful.”

Taste of Chicago offers an illusion of a city where powerful players coexist with new flavors. But this veneer is far from reality. Once the festival packs up and Grant Park clears out, Chicago will go back to normal: a brick-and-mortar oasis, shielded from competition from outsiders.

10 years after Kelo, how eminent domain is hurting business owners in Chicago

by Hilary Gowins, posted in op-ed

Op-ed posted on Watchdog.org.

It has been 10 years since the U.S. Supreme Court ruled that a Connecticut town could bulldoze residential property so a private group could build an office park.

After a lengthy legal fight and the destruction of the neighborhood, the land now sits abandoned and unused.

The ruling on this case, Kelo v. City of New London, caused an uproar: More than 40 states passed either constitutional amendments or statutes that have reformed eminent domain law to better protect property rights in the wake of the Kelo decision, according to the Institute for Justice.

But the corrupting power of eminent domain still rears its ugly head.

Today, a Chicago university is trying to bulldoze six properties so a private developer can build and operate dorms and retail stores.

In the northwest corner of Chicago, a state university president has moved to seize and bulldoze six small, family-owned businesses. In their place, Northeastern Illinois University President Sharon Hahs plans to hand over the land to a private real estate developer to build and operate student housing that will also include private, retail shops on the ground floor.

Hahs said this project is necessary because NEIU is the only state college without student housing. She claims the neighborhood is economically depressed, and this project would spur growth and revitalization. But the 3400 block of West Bryn Mawr Avenue is home to many small businesses, such as Caren Real Estate, Hunan Wok and the new Bryn Mawr Breakfast Club.

The owners of these businesses have invested in the neighborhood for years.

Bill Tong grew up in the property that now houses Hunan Wok restaurant. His grandfather, who immigrated to the U.S. from China, built the property in 1954. It became the Tong family’s home as well as its place of business, Tong’s Tea Garden. Bill and his sisters, Dolly and Betty, inherited the property from their late father in 2010. Their elderly mother, who still lives in the top-floor apartment, may be forced to leave the building they’ve called home for nearly six decades if NEIU gets its way.

“Being a Chinese-American, I knew that the ideal is for a son to preserve the accomplishments of his father and hopefully improve on them. I don’t stand a chance of that if the property is destroyed,” Tong said.

He isn’t alone.

Garrick Beil also grew up in the North Park neighborhood. His parents, Rosemary and Carl, were the children of German immigrants who came to Chicago from Germany in the 1920s. Rosemary worked as a school teacher and Carl was an architect and contractor, and to bolster their modest incomes they used their entire savings, plus loans from the bank and family members, to buy a dilapidated gas station at the corner of North Kimball Avenue and West Bryn Mawr Avenue. The Beils tore down that gas station and turned the property into two commercial spaces, both of which have been continuously occupied for nearly 40 years. Rosemary and her husband planned to rely on the income from these properties in their retirement. Instead, they are faced with a costly legal battle and an uncertain future.

As the story unfolding in Chicago’s North Park neighborhood shows, eminent domain often plays out as a modern David v. Goliath tale.

Small-business owners like Bill Tong and Garrick Beil can’t match the deep pockets of the state. Their only hope is that NEIU leaders have a change of heart, drop the eminent domain lawsuit and build on their own undeveloped land – approximately half of the college’s 67-acre campus is green space.

Tong and Beil’s story is a stark reminder that the threat of eminent domain remains just as real today for many as it did 10 years ago when the Supreme Court issued its Kelo decision.

NEIU’s President Hahs and other proponents of the government’s “right” to seize private property say they are well within their legal ability to pursue eminent domain — under the law, they’re correct. But legality doesn’t confer morality.

If the government can take land from Bill Tong, Garrick Beil and the homeowners in New London, Connecticut, the same thing can and will continue to happen to other property owners across the county.

As Illinois Suspends Corporate Tax Breaks, It’s Time to Recognize How Special Treatment Undermines a Welcoming Economy for All

by Hilary Gowins, posted in huffington post

Originally published on Huffington Post.

In the wake of Illinois state lawmakers passing a budget with a nearly $4-billion deficit, Gov. Bruce Rauner on June 2 froze two flagship tax-credit programs administered by Illinois’ Department of Commerce and Economic Opportunity.

Proponents of the Economic Development for a Growing Economy, or EDGE, andIllinois Film Tax Credit programs say they’re necessary to make the state competitive — acknowledging that lower tax burdens boost growth. The catch? Through selective tax breaks, the state gets to pick who succeeds.

Illinois’ budget impasse provides an opportunity to examine the existence of these tax credits and what makes them so attractive for politicians desperate to muster some semblance of economic growth.

First, film tax credits.

Starting in 2004, Illinois began giving out millions of dollars’ worth of tax breaks for TV and film production.

An influx of film and television activity has cropped up across the state: Superman found a temporary home in Aurora; the Dark Knight and the Joker squared off on LaSalle Street in front of the Chicago Board of Trade; and the cast of Empire, a show set in New York, has made a film studio on the west side of Chicago its home.

Illinois gave out $26.5 million in film tax credits between August 2013 and June 2014 alone, according to data obtained via Freedom of Information Act request from the Department of Commerce and Economic Opportunity. Politicians point togrowth in spending from the film industry and tout government’s ability to manipulate policy to trigger job creation. Every so often, someone in Illinois recognizes the spot of a memorable movie scene.

They also recognize a broken state when they see one.

Because jobs are scarce and the cost of living is high, people continue to flee the state. In 2014, 95,000 more people left Illinois for other states than moved to Illinois from other states — an all-time record high. There are 244,000 fewer Illinoisans working today than when the Great Recession began.

While the rest of the state is suffering, the film industry is enjoying sales- and income-tax breaks. But the film industry isn’t alone in receiving special treatment from the state. Since 2001, Illinois has given out more than $1 billion to the biggest businesses in the state through the EDGE tax-credit program, which is meant to spur economic growth.

It’s not working. Over the course of the EDGE tax credit’s life span, Illinois is down 123,000 payroll jobs.

Additional incentives are only necessary when something is unattractive. In the case of these two tax-credit programs, the state is seeking to address the high cost of buying goods (by providing sales-tax breaks) and the high cost of doing business (by providing income-tax breaks) in Illinois.

The Illinois Film Tax Credit allows for a 30-percent tax credit for qualified production spending. This concept is not a bad one, as it allows businesses to avoid paying taxes on business inputs (a practice that results in repeated taxation across the chain of production). The state, through the film tax credit, acknowledges that multiple layers of sales taxation hinders job creation but only applies an exemption from this financial strain to certain players in a certain industry.

Both the Illinois Film Tax Credit and EDGE tax credits also allow for tax breaks on income, which is a perk that small businesses and regular taxpayers do not enjoy. If the state realizes that industries won’t set up shop in Illinois without a lowered cost of doing business, then why doesn’t it address the underlying problem instead of handing out piecemeal tax breaks?

Solutions already exist that would make Illinois a more appealing place to do business.

For starters, lawmakers should fix Illinois’ workers’ compensation laws, which have led to the seventh-highest workers’ compensation costs in the nation. That seventh-worst ranking is after half-hearted reforms in 2011.

Good tax policy shouldn’t be restricted to select industries. If Illinois politicians want sustainable jobs growth, lower taxes should be applied across the board, not just to the politically connected.