A new bill that passed the Illinois Senate last week would create a new class of tax increment financing district that could only be created around Chicago transit stations and lines to capture the property value that being near transit generates. Most of the revenue generated by these TIFs would be earmarked to pay for construction of rapid transit lines, stations, and other transit-related facilities.
Under the new transit TIFs, when property values in the area increase due to an existing or planned transit facility, the additional revenue would be captured and used to fund the rehab of the existing facility, or pay for the construction of the new one.
The theory is that resulting transit improvements will further increase property values and tax revenue, creating a virtuous cycle where transit keeps getting better.