Buoyed by higher than expected marijuana revenues, Mayor Lori Lightfoot on Saturday canceled plans to lay off 350 city employees to help secure the 26 City Council votes she needs to pass her “pandemic budget.”
Revenues generated by the sale of recreational and medical marijuana have “gone through the roof”— topping $100 million statewide for the first time in October and $800 million in the first 10 months.
That will allow the city to cancel the layoffs and “bond against” a “conservative estimate” of future cannabis revenues — to the tune of $15 million in the corporate fund.
Some of the employees targeted for layoffs draw their salaries from the airport and water funds. Those employees will also be spared.
Sources said the deal was sealed in recent days when Lightfoot got personally involved in negotiations with Chicago Federation of Labor President Bob Reiter. The CFL has an ownership interest in the Chicago Sun-Times.
“After many productive conversations, we have come to an agreement to avert any layoffs of City workers in the 2021 budget,” Lightfoot and Reiter said in a joint statement.
“This will ensure Chicago’s public workers, the backbone of our neighborhoods, maintain their jobs and health insurance while also protecting the critical services Chicagoans rely on during these unprecedented times. We are committed to continue working together to identify places where we can partner on savings.”
One source described the bonding option as “tough to do” at a time when Lightfoot’s budget already includes a $3.7 billion refinancing. But, the mayor considers it a better option than layoffs.
Non-union city employees earning $100,000 or more — including the mayor and aldermen — will still be required to take five unpaid furlough days. The mayor’s original plan called for furlough days for everyone earning $50,000-a-year or more.
Ever since the stay-at-home shutdown triggered by the coronavirus pandemic, Lightfoot has said that the last thing she wanted to do was put even more Chicagoans out of work.
As she struggled to close a combined $2 billion budget gap this year and next, the mayor said layoffs and “morale-killing” furlough days were her “next-to-last resort” — second only to a property tax increase at a time when so many Chicago homeowners and businesses were struggling to pay their existing property tax bills.
But, when the mayor unveiled her budget Oct. 21, it included both of those politically-perilous options.
That set the stage for contentious negotiations that have tested her already strained relationship with the City Council.
The agreement with organized labor comes four days after the Chicago Federation of Labor presented Lightfoot with a cost-cutting smorgasbord with potential to save at least $195 million and as much as $272 million.
Many of the labor suggestions are “already factored into” the mayor’s budget or under consideration, sources said. Several other ideas need time to implement.
The 350 layoffs and the service cuts they required had emerged as a major point of contention with Chicago aldermen.
Eliminating the layoffs could go a long way toward winning the votes of at least some members of the City Council’s 20-member Black Caucus.
On Friday, Black Caucus Chairman Jason Ervin told the Sun-Times that cancelling all 350 layoffs was one of three major demands that the 20-member Caucus had made of Lightfoot.
The other two demands were “substantially” increasing funding for violence prevention beyond the $5.25 million that the mayor has added to last year’s modest $9 million investment and pinpointing the capital projects that the city intends to make on the South and West sides as part of her five-year, $3.7 billion capital plan.
With North Side aldermen virtually united in their opposition to the property tax increase, Lightfoot desperately needs support among Black and Latino aldermen to avoid an embarrassing City Council defeat.
On Friday, mayoral allies told the Sun-Times that the mayor was at least five and as many as 10 votes short of the 26 she needs to approve the property tax increase.
Lightfoot’s lobbying efforts were complicated by the threat she made this week to cut off Black aldermen who dare to oppose her budget.
In the first of two Veteran’s Day conference calls with African-American aldermen, Lightfoot warned aldermen that, if they don’t vote for her $12.8 billion budget and the property tax increase that it includes, “Don’t ask me for s—t for the next three years” when it comes to choosing projects in her five-year, $3.7 billion capital plan.
Ald. Jeanette Taylor (20th) said Lightfoot proved with that bald-faced threat that she is “no better than Daley or Rahm.”
On Saturday, Lightfoot told the Sun-Times she was incensed by the comparison.
“I’m not gonna dignify that. If somebody thinks that a black, female lesbian who has placed emphasis on equity and inclusion and, oh by the way, has spent a tremendous amount of city resources trying to rebuild the black South and West sides is exactly the same, then they are not paying attention,” the mayor told the Sun-Times.
Lightfoot refused to confirm or deny the, “Don’t ask me for s—t” remark. She simply said it was “taken out of context” and she is “not going to get in the mud with people who leak clearly private conversations.”
“Members of the Black Caucus — and particularly the more veteran members — have repeatedly complained about the fact that, over many administrations, they have taken the hard votes and they’ve gotten little to show for it,” the mayor said.
“What I’ve been very clear about saying to members who tell me they can’t and won’t vote for the revenue sources is that your ward cannot be prioritized over other wards who do vote for and support the budget. It’s not right and it’s not fair.”
To help wipe out a $1.2 billion shortfall caused primarily by the coronavirus, Chicago taxpayers are being asked to absorb a $94 million property tax increase followed by annual increases tied to inflation.
Lightfoot’s pandemic budget also raises taxes on gasoline, computer leases and cloud services. It includes furlough days for non-union employees, 350 layoffs for unionized employees and a $1.7 billion debt restructuring and refinancing with nearly $949 million of the savings claimed in the first two years.