City Council poised to wrap up budget season in record timeFran Spielmanon October 27, 2021 at 3:32 pm

The Chicago City Council met Wednesday at City Hall for final approval of Mayor Lori Lightfoot’s $16.7 billion spending plan. | Pat Nabong/Sun-Times

Mayor Lori Lightfoot’s $16.7 billion budget is on course to sail through the City Council, thanks to an avalanche of federal relief funds that paved the way for an unprecedented 30% increase in city spending.

Mayor Lori Lightfoot likes to celebrate her budget victories with a steak, a Scotch and a cigar.

After Wednesday’s City Council vote that will culminate the most tranquil budget season in recent memory, she might want add dessert to the menu.

Lightfoot’s $16.7 billion budget is on course to sail through the City Council, thanks to an avalanche of federal stimulus funds that paved the way for an unprecedented, 30% increase in city spending.

“There is something for everyone,” License Committee Chairman Emma Mitts (37th) told her colleagues after debate began shortly before 10:30 a.m.

Education Committee Chairman Michael Scott Jr. (24th) cited the $50 million for “street interventions” to tamp down violence and the increased spending for mental health.

Scott applauded the mayor for skillfully navigating the “tightrope walk between doing what is fiscally prudent and investing in” the city’s neediest residents.

Chicago’s property tax levy will rise by $76.5 million — on the heels of a $94 million hike in real estate taxes last year.

The increase includes: $22.9 million for an automatic escalator tied to the consumer price index; $25 million to bankroll the 2022 installment of Lightfoot’s $3.7 billion capital plan and $28.6 million captured from “new property.”

The increase — minus the new property — is expected to cost the owner of a home valued at $250,000 an extra $38-a-year.

At least a dozen “no” votes are expected against the property tax increase. But Lightfoot has easily sloughed off a demand from downtown Ald. Brian Hopkins (2nd) and the Hispanic Caucus to repeal the automatic escalator at a time when homeowners and business owners are already reeling from skyrocketing reassessments.

Chicagoland Chamber of Commerce President Jack Lavin made a similar plea on behalf of businesses bracing for a fundamental shift in how business property is assessed.

What the mayor has called a “once in a lifetime opportunity to transform” Chicago literally allowed Lightfoot to play Santa Claus, instead of Grinch.

That’s even after using about two-thirds of federal relief money to replace revenues lost to the pandemic in 2020 and 2021. She salted away $537.4 million of it to use in 2022 and 2023.

To reduce poverty made worse by the pandemic, Chicago will set aside $31.5 million to launch a one-year test of a concept known as universal basic income.

Under the plan, the city will send $500 checks, no strings attached, to 5,000 of Chicago’s neediest families. Lightfoot has called it the largest such cash assistance program of its kind in the nation.

Civic Federation President Laurence Msall called that program, championed by Ald. Gilbert Villegas (36th), chairman of the Council’s Hispanic Caucus, a “worthy experiment.” But Msall also said he’s concerned about creating a permanent dependency.

“It’s only for one year. Or, at the most, two years. City finance officials have assured us that there is no ongoing commitment once this money is passed out. But will there be an expectation by those recipients that more people will get that money, or they will continue to get it, even after the federal stimulus money is no longer available?” he said.

“It’s a reasonable question that many are asking. How can the city afford to do this going forward once the federal money is no longer available?”

Lightfoot moved up the budget process by a month to coincide with the unveiling of her plan to spend the federal relief funds.

She ended up using 68% of the federal money for revenue replacement. That freed up the city’s corporate fund to repay a $450 million line of credit used to eliminate a pandemic-induced shortfall and cancel $500 million in refinancing that would have been necessary without the second round of stimulus funds.

Still, she managed to earmark $1.2 billion for new investments by pooling $563 million in federal money with the $660 million that represents the 2022 installment of her capital plan.

Pat Nabong/Sun-Times
Mayor Lori Lightfoot presiding at Wednesday’s meeting of the Chicago City Council.

Christmas in Chicago will also come early with: $202 million to reduce homelessness; $52 million in new investments for mental health initiatives, $15 million of it to expand a pilot alternate response program for mental health emergencies; $150 million for youth programming; and $85 million for violence intervention.

To combat global warming, the mayor’s budget calls for planting 75,000 new trees over the next five years while reducing the year-long wait to get a tree trimmed by nearly doubling the number of crews devoted to that vital service.

There’s a $20 million Artist Relief and Works Fund, including $10 million in relief funds and a matching $10 million “dedicated revenue stream” from the corporate budget that will “no longer be subject to the vagaries of the hotel tax.”

The budget also includes several new or enhanced programs to relieve the burden on low-income Chicagoans driven into debt and bankruptcy by the city’s over-reliance on ticket revenues.

That includes so-called “fix-it tickets” for certain compliance violations, such as an invalid or missing city sticker, and a 50% reduction in tickets for low-income drivers.

In the horse-trading that preceded the final vote, Lightfoot also ratcheted up investments to satisfy the demands of Council members.

“When it was time to bend, you did. When it was time to [stand] steadfast, you did,” indicted Ald. Carrie Austin (34th) told Budget Director Susie Park.

“I wanted to extract some more money out of you. But, you weren’t budging.”

Austin then directly addressed the mayor who dumped her as Budget Committee chairman and forced her out as chairman of the consolation Committee on Contracting Oversight and Equity after her indictment.

“These are trying times for all of us. They are trying times for you. But, I know you’ve done 100 percent for the people who elected you,” Austin told Lightfoot.

Lightfoot steadfastly resisted demands to reopen mental health clinics shuttered by former Mayor Rahm Emanuel. But she did agree to increase staffing at the five city clinics that remain open by 72%. That includes 18 additional staffers and an expansion of evening hours.

Ald. Carlos Ramirez-Rosa (35th), chairman of the Democratic Socialist Caucus, has hailed that level of investment in mental health personnel as “something we haven’t seen happen in decades.”

Other 11th-hour concessions include more money for homeless outreach, single-room-occupancy buildings, food equity, forestry, marketing at the Commission on Animal Care and Control and additional city planners to oversee land sales.

In response to aldermanic concerns, an oversight sub-committee chaired by Budget Committee Chairman Pat Dowell (3rd) is also being created to ride herd of how the city spends the avalanche of federal stimulus funds.

With those changes — and more — the progressive agenda that can never be fully satisfied is, at the very least, appeased.

“This is a progressive budget,” Ald. Sophia King (4th), chairwoman of the Progressive Caucus, declared last week.

“I appreciate the collaboration we had on this budget and how my colleagues pushed to make sure that there are resources for the most neediest in our community.”

Ald. Leslie Hairston (5th) praised her colleagues in the Progressive and Black Caucuses for “pushing the limits” and going “somewhere we’ve never gone before as a Council.

Thanks to that pressure, “We can really begin to have meaningful direction is moving towards a city that is fairer for all,” Hairston has said.

Last year Lightfoot balanced her budget by, in part, eliminating 614 Chicago Police Department vacancies and shrinking CPD by attrition.

This year, she’s increasing police spending by $189 million — to just under $1.9 billion. But, Park has said the “full driver” of that increase is the new police contract, with its 20% pay raise over eight years.

Meanwhile, the tidal wave of police retirements continues with 703 retirements already this year and 987 sworn vacancies.

Far Northwest Side Ald. Anthony Napolitano (41st), downtown Ald. Brendan Reilly (42nd) and O’Shea wanted Lightfoot to restore some positions.

But the mayor has argued that CPD will have enough trouble just filling the 1,000 vacancies amid waning interest in the police profession.

“Our challenge is not the vacancies. The challenge is that, to be blunt, we get butts in seats to take the test. And then, once we get them into the academy, make sure they stay as police officers here in Chicago and not go to the suburbs or go to other city employment like the fire department,” Lightfoot told the Sun-Times editorial board on the day she introduced her budget.

Despite the political euphoria that will surely come with having put the budget to bed in record time, Msall warned Chicago is hardly out of the woods.

Although the city has “climbed the ramp” to actuarial funding for all four pension funds, there is still no long-term funding source from Springfield, like a tax on retirement income or a sales tax on professional services. Nor has the Il. General Assembly heeded the Civic Federation’s call for a constitutional amendment eliminating the pension protection clause going forward.

Msall also remains concerned about the mayor’s continued reliance on one-time revenues, the city’s mountain of debt and about her plan to refinance $1.2 billion more and use $232 million of the savings to bankroll four years of back pay for Chicago Police officers.

He’s equally concerned about what will happen “when the federal ARP money goes away” — particularly if the $153 million in federal relief reserved for revenue replacement in 2023 is not enough.

“What’s Plan B if the city does not recover at the aggressive and robust growth that the city is hoping for? We need to have a Plan B? Will we try to raise taxes if the economic disruption caused by the pandemic continues? Will we make structural changes? Will we be cutting?” he said.

“In likelihood, it’s going to have to be a combination of all of that. But if we don’t see a return where business travel comes back, where convention attendance [comes] back, the city is going to have a hard to meeting its debt obligations for many of the key investments that those industries support.”

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