Lightfoot says Springfield agenda on track, despite corruption scandal and demand for more funding to combat homelessness

Mayor Lori Lightfoot said Tuesday’s she’s not concerned a blockbuster corruption scandal and demand for additional funding to combat homelessness will derail her Springfield agenda and blow a giant hole in her 2020 budget.

Thirteen Democratic lawmakers are threatening to withhold their votes from Lightfoot’s proposal for a graduated transfer tax, with higher levels for high-end home sales, unless “at least 60%” of the annual funding is “statutorily dedicated” to combat homelessness.

Of those 13, 10 have districts that include parts of Chicago.

“That’s never gonna happen, obviously. … We’re not gonna be in a situation in the near-term to be able to take 60% of a significant revenue stream off the table and devote it to any issue,” Lightfoot said Tuesday.

The mayor said there are “a number of issues that we care about” that would promote “equity” and, therefore, deserve additional funding. They include homelessness, mental illness and violence reduction.

“We’d love to be able to fund them all at the highest possible level. But the reality is that we have a budget with a huge deficit — not just for this year, but in the years to come. We’ve got to be realistic about managing taxpayers’ dollars in a responsible way,” she said.

“Sixty percent of a dedicated revenue stream in perpetuity is not responsible given what our other budget stresses are.”

The demand for homeless funding isn’t the only hang-up. So is the burgeoning corruption scandal that has spread from Chicago and the south suburbs to Springfield and changed the power dynamic in the state capital.

A 13-page criminal complaint unsealed Monday against state Rep. Luis Arroyo, D-Chicago, revealed the on-again, off-again cooperation with the FBI of a state senator who wore a wire on Arroyo in hopes of landing a reduced sentence for filing false income tax returns.

A source identified that lawmaker as Sen. Terry Link, D-Vernon Hills, a chief architect of the gambling package that cleared Springfield earlier this year.

That threatens to derail Lightfoot’s other priority in the abbreviated veto session: a casino gambling fix, either through city-state ownership of a Chicago casino or a revised tax structure.

A former federal prosecutor, Lightfoot acknowledged the criminal complaint against Arroyo “caught people’s attention for most of the day” Monday and “probably is still resonating today.”

But she said: “We didn’t expect that Chicago issues would really get pushed forward until the second week of the session. So, I think we’re on track.”

Link was the prime-mover behind the bill that finally included the casino that has eluded Chicago mayors for decades. Doesn’t his alleged undercover role threaten to turn her proposed Chicago casino fix into snake eyes?

“I don’t think so. ... He’s one person in one chamber and there’s a lot of other voices at the table,” Lightfoot said.

Won’t the scandal paralyze lawmakers into doing nothing during the six-day fall veto session?

“No ... I don’t think that’s” a possibility, the mayor said.

During opening day of City Council budget hearings, aldermen from across the city demanded details on Lightfoot’s Plan B.

What happens if the mayor comes up empty in Springfield? What if the federal government refuses to sign off on the $163 million windfall that the mayor assumes she’ll get by increasing ambulance fees paid by private insurers and from reimbursements administered by the state for ambulance transports for low-income patients on Medicaid?

What if $200 million in savings claimed in the first year alone from re-financing $1.3 billion in city debt turns out to be overly optimistic?

Budget Director Susie Park, Chief Financial Officer Jennie Huang Bennett and City Comptroller Reshma Soni would only say they are “hopeful” all of their assumptions will turn out to be accurate.

Park noted the veto session will be over long before Nov. 26, when the City Council is scheduled to approve the mayor’s first budget.

“If we find that something has changed, we’ll bring forward a different revenue package,” Park said, refusing to say how big a property tax increase would be.

Even without a single Republican vote for the graduated real estate transfer tax, Lightfoot can afford to lose fourteen Democratic votes in the Illinois House.

That’s because she’s counting on just $50 million in revenue next year and conservatively assuming she will only manage to win the simple-majority needed for a July 1 effective date — not the super-majority needed to begin collecting the graduated tax on Jan. 1.