Story URL: http://news.medill.northwestern.edu/chicago/news.aspx?id=176056
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Arun's Thai

Diana Novak/MEDILL

Arun Sampanthavivat's restaurant, Arun's, is more expensive than the one planned for the development.


City-funded Thai restaurant stretches TIF money rules, says expert

by Diana Novak
Jan 12, 2011


Related Links

Yesterday's story about the Thai Town Center Plan

TIF Districts in Ald. Laurino's Ward

Lawrence-Pulaski

Lawrence-Kedzie

Peterson-Pulaski

Peterson-Cicero


Plans to build a publicly funded retail center have raised questions about how the funding was approved.

The Thai Town Center, including a Thai restaurant, retail shops and a spa, will be built in Albany Park’s old 17th District police station, where Ald. Margaret Laurino (39th) was instrumental in awarding the project $1.5 million in Tax Increment Financing. TIF funds come from property tax revenue typically earmarked for economic development of blighted areas.

Rachel Weber, University of Illinois at Chicago professor and city planning expert, said the project is evidence of how the tax money has “morphed into an all-purpose general development subsidy.”

Weber said that legally, TIF money is supposed to be used for larger scale projects that could have a real economic impact on the physical fabric of a neighborhood.

“It sounds a little small in scale, which opens the door for anybody who is developing a restaurant, whether it is a Thai restaurant or fast food or any type of retail operation to ask for city assistance.”

Although recently, TIF money has been used for retail development projects, Weber says that was not the original intent of the program.

“It sort of doesn’t set a great precedent,” she said.

According to their website, Thai Town Center’s president Arun Sampanthavivat worked closely with Mayor Richard M. Daley and Laurino to secure the funding and site for his project. Daley was initially attracted to the idea after meeting with Sampanthavivat during a Thai event the city hosted in 2005.

Following their meeting, Sampanthavivat made his first campaign contributions on record-- $2,500 to Daley in 2006 and $250 to Laurino in 2007. According to state records, he has not donated to any other candidates.

Sampanthavivat was traveling and was unavailable for comment.

Calls to Laurino were not returned.

The developers of the Center have said the plan could draw more businesses to the area and will create at least 25 new jobs.

Dawn Clark Netsch, professor of law emerita at Northwestern University, former state legislator and campaign finance reform advocate, says it is no secret that campaign contributions have sway with politicians.

“In some cases there is a relationship between contributions and whatever the approval is, legislative or executive,” said Netsch. “Lots of things are considered suspect actually, whether or not they are, and that destroys credibility in the entire process.”