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Finance Committee approves Lightfoot’s $104.2 million package of taxes and fees

Mayoral allies beat back efforts to kill a $40 million congestion fee and a first-ever trash-collection fee for non-profits; the Finance Committee also approved a $1.5 billion debt refinancing package.

Finance Committee Chairman Scott Waguespack (32nd) (second from left) and Deputy Corporation Counsel Jeff Levine (far left) huddle with Ald. Matt O’Shea (19th) (right) during a brief recess at Tuesday’s Finance Committee meeting.
Finance Committee Chairman Scott Waguespack (32nd) (second from left) and Deputy Corporation Counsel Jeff Levine (far left) huddle with Ald. Matt O’Shea (19th) (right) during a brief recess at Tuesday’s Finance Committee meeting.
Fran Spielman/Sun-Times

Mayor Lori Lightfoot’s $104.2 million tax and fee package sailed through a City Council committee Tuesday after mayoral allies beat back efforts to kill a $40 million congestion fee and a first-ever garbage collection fee for non-profits.

Ald. Ray Lopez (15th), the mayor’s most outspoken City Council critic, made the motion to strike both fees from the budget. He was easily defeated by votes of 22-to-5 and 20-to-5.

The Finance Committee vote sets the stage for final approval of the $11.65 billion budget — and the revenues needed to pay for it — at the Nov. 26 City Council meeting.

In arguing against the congestion fee, Lopez questioned why the city was looking a gift horse in the mouth, saying the mayor, who came up empty in Springfield, should at least consider Uber’s alternative plan to generate $50 million a year.

“We’re trying to find new revenue. ... For this administration to say, `We’re worried about whether there’s two people in an Uber or one, so we’re gonna skip out on $10 million’ at a time when we know this budget is already off” makes no sense, Lopez said.

“Next year’s gonna be worse. Why would we just shut the door on that from the very beginning?”

Ald. Ray Lopez (15th) (right) talks to Budget Director Susie Park (left) during a break at Tuesday’s Finance Committee meeting.
Ald. Ray Lopez (15th) (right) talks to Budget Director Susie Park (left) during a break at Tuesday’s Finance Committee meeting.
Fran Spielman/Sun-Times

Budget Director Susie Park insisted the mayor’s $40 million revenue estimate — by tripling the tax on passengers riding solo to and from downtown and slapping a 74% increase on ride-hailing trips in the neighborhoods — is “conservative.”

It also focuses on congestion, imposing the highest fees on solo riders in the downtown area, she said.

Lopez was not appeased.

“Every time we’ve heard the word ‘confident’ in this budget cycle, we have failed miserably,” Lopez said, referring to Lightfoot’s bold predictions that state lawmakers would approve a casino gambling fix and a graduated real estate transfer tax during the now-concluded fall veto session.

The proposal to end the garbage collection freebie for nearly 1,200 non-profits follows years of pressure from Inspector General Joe Ferguson.

From now on, non-profits will be required to hire private scavenger services if: they have “assets or fund balances” greater than $1 million; their property has 11 or more garbage carts; or the Streets and Sanitation Commissioner determines more than 11 garbage carts “are necessary to prevent overflow.”

“In the relative scheme of things, we’re not talking about a lot of money,” North Side Ald. Debra Silverstein (50th) said of the $212,000 proposal.

“It’s an undue hardship on some of these not-for-profits that have to pay for garbage.”

The tax package approved Tuesday includes an $18 million property tax increase to open Chicago Public libraries on Sundays.

The Civic Federation has noted the budget actually contains $72.3 million in additional property tax revenues, including $7 million more for the City Colleges of Chicago and a $33 million increase tied to a general obligation bond issue approved in the waning days of former Mayor Rahm Emanuel’s administration.

The revenue package advanced Tuesday also includes:

• $20 million by raising the tax on downtown restaurant meals to a whopping 11%.

• $17.2 million by raising the “cloud tax” on the tech community—from 5.25-to-7.25 percent.

• $7.8 million by raising hourly parking meter rates — to $7 in the Loop (up from $6.50) and to $4.50 in the Central Business District (up from $4). That would be followed by annual cost-of-living adjustments. Meters also would be installed in a broader area of the Loop and West Loop.

The Finance Committee also authorized a $1.5 billion refinancing of city debt through a combination of general obligation and sales tax securitization bonds.

“Debt service in every year will be lower than the refunded debt service. This is not a scoop-and-toss. A scoop-and-toss increases your debt service or, alternatively, extends debt service,” said Chief Financial Officer Jennie Huang Bennett.

Huang Bennett also defended Lightfoot’s decision to claim the entire $210 million in savings up-front. That’s one-time revenue and won’t be available next year, when the pension ramp imposes an even more crushing burden on the city.

“Finding $838 million of structural relief all in one year taxes the system. Either you’re increasing revenues or you’re reducing expenditures,” the CFO said.

“We believe that we have a financial plan over the next three years to get us to full structural balance. This is really just giving us some runway to do that.”