Mayor Rahm Emanuel has repeatedly shot down efforts to raise Chicago’s real estate transfer tax on high-end home sales — either to reduce homelessness or replace lead water service lines — arguing that homeowners are “not an ATM machine.”
On Monday, mayoral allies on the City Council’s Finance Committee did it again by the narrowest of margins.
They used a parliamentary maneuver to stall efforts to get a referendum on the November 2020 ballot asking voters whether they favor raising the transfer tax by 1.2 percentage points on homes sold for at least $1 million; proceeds would benefit the homeless.
Thirty-three aldermen have co-signed the resolution. But it belongs in the Rules Committee — not Finance — according to Ald. Brendan Reilly (42nd), whose downtown ward has more $1 million-plus homes sold than any other.
“This has nothing to do with the merits of my colleague’s proposal. This is about getting this job done properly and lawfully,” Reilly told the Finance Committee.
“If this is a good proposal, then a majority of members of the Rules Committee, which is all 50 members of the Council, can vote in the affirmative or against. But that is the proper committee for this to be considered, like all other referenda.”
Ald. Roberto Maldonado (26th), chief sponsor of the resolution, said it was referred to the Finance Committee because “at the end of the day, it is a finance question. … The opportunity for the voters to decide whether they want to approve this transfer tax.”
“None of these shenanigans came through when we were rushing through the Lincoln Yards” development, Maldonado said, to the applause of homeless advocates gathered in the City Council chambers.
Maldonado’s motion to approve the resolution was tabled by a roll call vote of 11-to-10. The roll had to be called twice because aldermen were confused about what they were being asked to vote on.
Homeless advocates left the City Council chambers chanting, “Housing is a human right.”
That echoed a news conference before the vote, at which advocates had branded housing a “fundamental” right. With mayoral runoff opponents Lori Lightfoot and Toni Preckwinkle both endorsing the tax increase, advocates argued, there is “no excuse” to keep the referendum question off the ballot.
The Chicago Coalition for the Homeless has estimated the tax hike would raise enough new money to shrink the city’s homeless population by 35,000 people over the next decade.
Thomas Gordon is one of those people. He’s living on the streets of Uptown.
“I have to deal with weather conditions. That causes me a lot of pain. I don’t like living on the street. But I can’t find affordable housing in the area where I am comfortable,” Gordon said, wearing a “Bring Chicago Home” sweatshirt.
“I want to be able to spend time indoors with loved ones — not in a tent. I want to volunteer more — not spend my time looking for food and a safe place to sleep. I want to go home at the end of the day where I can rest, eat from a refrigerator and cook.”
Mark Angelini, president of Mercy Housing lakefront, noted Chicago now has more than 80,000 residents either “homeless or unstably housed.”
“This is a crisis — and it crosses all demographic categories,” he said.
“Failure to address this crisis is not only inhumane, but damaging to society at large, both in terms of lost human potential as well as direct expenses that overwhelm our hospitals, our schools and our criminal justice system.”
Chicago desperately needs to increase the supply of “high-quality affordable housing and expand access to physical and behavioral health services,” Angelini said.
“In an era where taxes are disproportionately hurting low-to-moderate wage earners, we must enact policies that progressively create new resources to meet this goal,” Angelini said.
Aldermen from across the city have been eyeing the transaction tax as a catch-all solution to an array of problems — from replacing lead service lines to confronting homelessness and supporting police and fire pensions.
In November, Emanuel said the goal of ending homelessness is a noble one, but argued this is not the time to deprive beleaguered Chicago homeowners of equity.
“I don’t think you should treat the homeowners as an ATM machine. … The homeowner should be the last person we should go to for a fee before we try everything else,” the mayor said then.
“I disagree with the methods because I don’t think the first line of defense should be the homeowner’s pocket. I think that’s a mistake. I think it will actually impact other things economically that affect the well being of the city.”