clock menu more-arrow no yes

Filed under:

City’s proposed 2021 budget will erase $1.2 billion shortfall — and without more federal help, top mayoral aides say

Chief Financial Officer Jennie Huang Bennett and Budget Director Susie Park said a property tax increase is “last on our list” but must remain on the table because it is the most broad-based and reliable source of revenue.

Chicago City Hall, 121 N. LaSalle St.
Mayor Lori Lightfoot’s proposed city budget for next year will assume no more assistance from the federal government to replace lost revenues due to the pandemic.
Sun-Times file

Mayor Lori Lightfoot’s 2021 budget will erase a $1.2 billion shortfall without assuming any replacement revenue from Washington — but with hundreds of millions of dollars in tax increases and budget cuts that include a mix of layoffs, furlough days and pay cuts, top mayoral aides said Thursday.

Chief Financial Officer Jennie Huang Bennett and Budget Director Susie Park said a property tax increase is “last on our list” as homeowners and business owners struggle to pay their mortgages and stave off foreclosure.

But it must remain on the table, they said, because it is the most broad-based and reliable source of revenue to help erase a shortfall of historic proportions. For the same reason, a sales tax increase also is possible but would require authorization by state lawmakers.

“Increasing taxes in this difficult economic environment does not create a stimulative environment. But we also have to balance that with the fact that we have to make revenues match expenses and have a balanced budget,” the city’s CFO said Thursday.

Chicago is so desperate for money, the city is seriously considering a temporary casino to get the jackpot rolling in until a permanent casino and entertainment complex can be built.

McCormick Place East, rebuilt after a 1967 fire, is one of many possible locations for a temporary casino, Huang Bennett said.

Lakeside Center at McCormick Place
McCormick Place’s Lakeside Center is under consideration as a possible location for a temporary Chicago casino, a mayoral aide said Thursday.
Sun-Times file

Earlier this week, Lightfoot blamed rising coronavirus case levels in Chicago and two rounds of looting for a dramatic increase in the city’s budget shortfall — to a combined $2 billion for this year and next.

Lightfoot made a strong case for replacement revenue from Washington and said she would offer “contingencies” if the pre-election stalemate continues.

But Park said Thursday it’s the other way around.

“We are gonna put this budget together assuming we are not getting federal funding,” she said.

“There’s not gonna be, with a gap that size, one thing that’s going to close that. … It is gonna be looking internally, workforce efficiencies, new revenue and a whole slew of things.”

So far, the city workforce has escaped the pain endured by private sector employees who have seen their hours cut and paychecks shrunk if they’re lucky enough to have jobs at all.

That will not continue. The mayor needs concessions.

“What we need from organized labor is for them to come to the table with actionable solutions that can help to support us in the 2021 budget. In previous years, we had the luxury of prioritizing certain solutions over others. This year, all of them are gonna be needed,” Huang Bennett said.

Does that mean a mix of layoffs, pay cuts and furloughs?

“Yes. We put that on the table. … What the size and shape of this is, we’ll obviously have to have those conversations. But we’re not alone in this. A lot of cities across the country have had significant numbers of personnel actions. ... We are in the midst of a crisis where we have seen significant unemployment in the city of Chicago. And ultimately, government has to reflect what’s going on in the broader landscape,” she said.

Chicago Federation of Labor President Bob Reiter could not be reached for comment. The CFL has an ownership stake in Sun-Times Media.

Earlier this week, Reiter told the Sun-Times the mayor made no specific demand when she addressed the labor federation’s board on Monday.

Pressed on what concessions union leaders are prepared to give, Reiter said, “We always have ideas that stay away from cutting essential services. I would always offer those — both in revenue and ways to save money — before we ever get to anything else.”

Although Lightfoot has strongly resisted demands to defund the police, Park made it clear the $1.8 billion-a-year Chicago Police Department budget “is not gonna be exempt from this exercise” of budget cutting.

Asked if CPD has too many members of the brass with six-figure salaries, Park said, “That’s gonna be the conversation that we have. What’s the right number? We definitely want to make sure the superintendent has the level of staff that he needs to do his job and get what he needs to do done. But we’re gonna have those conversations just like I’m having with all of the commissioners.”

Same goes for the Chicago Fire Department. When a newly-ratified contract expires June 30, treasured union perks and staffing requirements that cost taxpayers millions will be back on the table, the budget director said.

As Chicagoans brace for another avalanche of tax increases, Lightfoot is also putting the final touches on an $8 billion-to-$10 billion plan to replace lead service lines carrying water from street mains to roughly 360,000 Chicago homes.

During Thursday’s wide-ranging interview with the Sun-Times, Huang Bennett acknowledged for the first time that homeowners would ultimately be asked to share that heavy cost, through another fee attached to their water bills. The size of the increase will depend on how quickly the lines are replaced, she said.