United Gives Back TIF Funds to Chicago

United Continental Holdings, the parent company of United Airlines, is going to give back $5.6 million to the City of Chicago. It is the incentive money the city gave the airline when it moved its corporate headquarters at 77 W. Wacker Drive in 2007.

United recently announced its plans to move out of the build and move its headquarters into Willis Tower. The airline said that it was appropriate that it returned the money even if city official said that it was not necessary.

City officials said the United has already fulfilled its obligations for receiving the incentive, such as maintaining a minimum employment level in the 77 W. Wacker Drive building. The city officials added that the incentives would have traveled with United as it moved several blocks to Willis Tower.

United announced that it would give back $5.6 million it has received in Tax Increment Financing or TIF. It was a funding tool used by the City of Chicago to promote investment. The company would also forego up to $9.7 million more in TIF money that Chicago would have given United. But it was learned that the remaining $9.7 million would not be received by United because it was tied to the airline’s fuel consumption at O’Hare International Airport.

United didn’t include the $35.9 million in TIF money that was connected to a separate 2009 incentive deal that involved moving 2,500 employees from Elk Grove Village to Willis Tower. United spokeswoman Christen David said that the company redeveloped 77 W. Wacker through the help of the city economic incentives and the company feels it is just appropriate to return the amount it used for the redevelopment.

The airline decided it should not combine the incentive deals for the two locations. The decision to give back the money doesn’t have any impact on the agreement for Willis Tower.