Mayor Rahm Emanuel on Friday ruled out a post-election property tax increase but confined the guarantee to the city’s $300 million operating shortfall, prompting Ald. Bob Fioretti (2nd) to warn of a “massive” property tax hike for pensions if Emanuel is re-elected.
“Is it on the table? Yes or no. Tell us now. Are you going to raise property taxes?” Fioretti hounded Emanuel during a two-hour debate-style endorsement session before the Chicago Sun-Times Editorial Board.
“Not for the operating budget,” Emanuel said.
What about to solve Chicago’s $20 billion pension crisis?
“I don’t know yet,” the mayor said.
That prompted Fioretti to offer a dire warning to beleaguered Chicago homeowners.
“He’s raised it with the Board of Education. He’s raised it with the Chicago Park District. And now, he’s talking about, `Well, it’s not gonna be for the operating budget.’ We all know what that signals: Everybody better be very ready if he’s the mayor for a massive property tax increase,” said Fioretti, who wants to tax commuters, transactions at La Salle Street exchanges and bring back a modified version of the employee head tax that Emanuel eliminated.
All five mayoral hopefuls participated in the endorsement session — one of only five forums featuring the entire field.
Cook County Commissioner Jesus “Chuy” Garcia steered clear of revenue solutions during Friday’s endorsement session but resurrected a doozy afterward: legalizing and taxing marijuana.
That’s an idea that Chicago Teachers Union President Karen Lewis championed — and Emanuel ridiculed — before surgery to remove a malignant brain tumor forced Lewis to drop out of the mayor’s race and endorse Garcia.
“It’s something we remain interested in looking at as another creative potential source . . . because we need money. And if it doesn’t produce any harms to people in the state of Colorado, and if they’re able to generate revenue, we shouldn’t rule it out,” Garcia said.
“We’re looking at the Colorado experience to see how it goes, what impact it has on public safety, if there are any health concerns to be learned from that,” Garcia said.
Perennial candidate William “Dock” Walls said he would shift city employees away from “defined benefit” pension plans and toward the “defined contributions” or 401(k) plans favored by private industry.
Millionaire businessman Willie Wilson said he would reopen Meigs Field and pressure the Illinois General Assembly to authorize a municipally owned casino in Chicago.
Emanuel initially proposed raising property taxes by $250 million over five years to bankroll the city’s increased contribution to the Municipal Employees and Laborers pension funds.
He agreed to substitute a 56 percent increase in Chicago’s telephone tax for the city’s first-year contribution, only after then-Gov. Pat Quinn balked at a pre-election property tax hike.
The mayor has refused to say how he plans to meet the city’s increased obligations to the two funds after the first year, when the telephone tax will fall short.
He has also put off until December a decision on how Chicago will meet a state-mandated, $550 million payment to shore up police and fire pension funds with assets to cover just 24 percent and 30 percent of their respective liabilities.
The decision to put off Chicago’s financial day of reckoning left an opening for Garcia to exploit.
“City finances are a huge question mark. He promised to put them in order, and they’re not. . . . We don’t have a plan,” Garcia said, suggesting that he would merge the city and county health care systems and transportation departments and order a “forensic audit” of tax-increment-financing (TIF) districts if elected mayor.
In a friend-of-the-court brief in the state pension cases, city Corporation Counsel Stephen Patton has warned that Chicago faces a $300 million deficit in 2016 with shortfalls continuing “for the foreseeable future”— even before piling on $20 billion in pension liabilities that have saddled the city with the “worst credit rating of any major city other than Detroit.”
And if state legislation that saved two of four city employee pension funds is overturned, a “catastrophic outcome” awaits retirees and Chicago taxpayers alike triggered by “further downgrades,” according to the brief.
Much, but not all, of Friday’s Sun-Times endorsement session focused on the dire state of city finances.
It also gave the four mayoral challengers another chance to kick Emanuel in his Achilles’ heel: the decision to close a record 50 Chicago Public Schools, most of them in African-American neighborhoods on the South and West Sides, without a comprehensive plan about what to do with those shuttered buildings.
“Nobody in their right mind would close 50 schools. Eighty-eight percent of ’em was in the African-American community. Ten percent in the Hispanic area. Those kids got to walk two, three miles to school in gang territory. You’re gonna put police officers [out there] to try to protect them, but the crime rate is still high,” Wilson said.
“I lost a kid — a 20-year-old — so this is a very sensitive situation for me. . . . At those 50 schools, parents can’t think about education at the moment when they think their kid might get killed.”
Garcia acknowledged that some half-empty schools probably needed to be closed — but he told Emanuel, “You need to consult with people — not do it by fiat.”
Fioretti said the school closings were “thoroughly vetted” by retired judges who recommended that as many as 16 schools on the Chicago Board of Education’s hit-list remain open.
“They didn’t listen. The whole thing was a charade,” he said.
Walls accused Emanuel of closing schools as part of broader plan to “sanitize” public schools, get rid of “problem and at-risk” students and leave behind the “cream of the crop.”
Emanuel then got his chance to defend the school closings that prompted African-American voters who helped put him in office to abandon him in droves.
He talked about the 100 community meetings that attracted 38,000 people and about the list of 300 under-enrolled schools that was ultimately reduced to 49.
“That is the process that was put in place to listen to people, make changes, hear what they had to say. Was it perfect? No. Did it finally end a process where kids were trapped in a school that was not only under-enrolled, but consistently under-performing? Did we do the important things to give them a better future at a better school? Your own paper identified that as exactly what happened,” Emanuel told the Sun-Times Editorial Board.
“Whether it was 10 or 49, it was gonna be very difficult. But my politics are second — a backseat — to giving children a better opportunity. . . . The lion’s share are now going to a better school, and we’ve also created the safety for them” to get there.
Sun-Times columnist Mary Mitchell pressed Emanuel on why he didn’t have a plan to “repurpose” targeted schools that once served as community anchors.
“Getting the kids to a better-performing school was the No. 1 priority, and that’s what I stayed on the system to execute,” he said.
“The second part of that process is to then look at each of these individual schools in different areas, and how do we reprogram? . . . If I sat here and said, ‘It will be done [by a certain date],’ that would not be an honest answer. I’m not gonna do that. Some will move quicker because developers are interested than others.”
Editorial page editor Tom McNamee ended Friday’s endorsement session by asking each candidate to give a closing statement.
Wilson, who has donated millions to black churches, closed with a prayer. Given the precarious state of city finances, the next mayor of Chicago will need all the prayers he can get.