Civic Federation offers revenue, cost-cutting options to confront Chicago’s financial challenges

For each new administration, the Civic Federation tries to make confronting Chicago’s financial challenges a little easier, analyzing the pros and cons of taxes, fines and fees — but without taking a definitive position on any of them.

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Chicago City Hall.

Chicago City Hall.

Anthony Vazquez/Sun-Times

Cut the 50-member City Council in half. Combine the elected jobs of city clerk and treasurer and make it a mayoral appointment. Impose annual increases in a garbage collection fee that’s been frozen at $9.50-a-month since its 2015 inception.

Those are among the proposals in the latest edition of a report the Civic Federation issues every time Chicagoans elect a new mayor, hoping to make the formidable job of confronting Chicago’s enormous financial challenges easier.

The report from one of the city’s oldest and most respected taxpayer watchdog groups analyzes the pros and cons of a host of new and increased taxes, fines and fees — without taking a definitive position on any of them — and proposes other structural and management reforms with heavy potential to cut costs.

The transition from Lori Lightfoot to Brandon Johnson and from a seasoned, more conservative City Council to a younger, inexperienced and more progressive bunch is no different. That’s even though the Civic Federation is also in transition after the sudden death of its longtime president Laurence Msall.

The federation’s 65-page report, released Wednesday, includes many of the same ideas the watchdog group, the inspector general’s office and others have championed over the years, to no avail.

It also includes some new suggestions — like a city charter, unraveling the “financial entanglements” between the city and the Chicago Public Schools before an elected school board is fully-seated and “civilianizing” the Chicago Police Department to free sworn officers to fight stubbornly high levels of violent crime and get CPD out from under a federal consent decree.

The restructuring proposals are not new.

The seemingly radical proposal to shrink the City Council to 25 members was championed decades ago by indicted and now-retired Ald. Edward Burke (14th), the longest-serving alderperson in Chicago history. Former Mayor Rahm Emanuel resurrected the idea after his 2011 election, only to drop it amid stiff resistance from alderpersons who became his rubber stamp.

Lightfoot campaigned on a promise to abolish city stickers along with the office that sells them, only to abandon that cost-cutting promise in favor of working together with City Clerk Anna Valencia to eliminate the Denver boot for non-moving violations and bring equity to an overly-punitive ticketing policy.

Acting Civic Federation President Sarah Wetmore acknowledged Wednesday that legislative approval would be needed to shrink the Council and eliminate two citywide elected officials and that those suggestions are likely to hit a brick wall again.

But she argued it’s important to get those and other controversial ideas “out into the bloodstream” as Chicago grapples with “five major fiscal challenges”:

• An “enormous,” $33 billion pension shortfall that has left Chicago’s four city employee pension funds with assets to cover an average of just 24% of their liabilities.

• A rate of homicides and other violent crimes that remains markedly higher than other major cities.

• A “chronically-high liability burden.”

• A continued structural deficit.

• And, the end of an avalanche of federal pandemic relief funds that will no longer be available to prop up the city’s budget.

“The City Council is large in comparison to other City Councils around the country. … In reports that date back to the 1950s, that means that they function less as a legislative companion to the mayor and, instead, focus more on the day-to-day functions of their wards,” Wetmore told the Sun-Times.

Isn’t that what Chicagoans want their alderpersons to be?

“They want to have a City Council that focuses on the financial sustainability of the city. That focuses on its operations and making sure it’s running in a transparent manner in addition to focusing so incredibly much on minute details of what’s happening in the ward,” she said.

A similar rationale drives the proposal to merge the “mostly ministerial” clerk and treasurer’s offices, Wetmore said. Both jobs now pay $161,016 a year.

“They don’t make policy. Generally, we want those kinds of positions to be appointed, rather than elected,” she said.

Many revenue ideas analyzed in the report were highlights of Johnson’s $800 million tax package — with the exception of a city income tax championed by his union supporters and a commuter tax the new mayor proposed, then dropped.

They include: a revived employee head tax; a “La Salle Street tax” on financial transactions; a graduated real estate transfer tax; and raising the 5-cents-a-gallon tax on jet fuel.

The Civic Federation did not take a position on any of those and other taxes. Nor did its report offer revenue estimates for them.

But the report does recommend that the $9.50-a-month garbage collection fee widely-viewed as a back-door property tax increase be increased every year to offset the $100 million cost of removing waste from 600,000 Chicago households.

Wetmore said the annual increase should be part of a larger “cost-of-service analysis” of other city services that also fall short of covering actual costs.

Every Chicago mayor since Richard M. Daley has made a public show of transferring Chicago police officers from desk jobs to street duty.

Even so, more than 93% of the 14,058 budgeted position in the Chicago Police Department’s 2022 budget were sworn personnel, the report states. That’s 13.8 sworn officers for every civilian employee.

In other major cities, civilians hold 22.2 percent of law enforcement jobs, with 3.5 sworn officers for every one civilian employee.

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