Emanuel tries to sell 28.2 percent phone tax hike

Mayor Rahm Emanuel said Friday he would ask the Chicago City Council to sign off on a 28.2 percent increase in the monthly tax tacked onto phone bills to make the city’s 911 emergency system modern and self sufficient.

Earlier this week, a top mayoral aide told the Chicago Sun-Times that Emanuel would use the increase — from $3.90 a month to $5 for every cell phone and land line — to help shore up the Laborers pension fund “well into the next decade.”

On Friday, the mayor played a bit of a shell game.

He tried to sell the 28 percent increase — on the heels of a 56 percent increase approved by the City Council in 2014 — as essential to maintaining Chicago’s 911 emergency system.

In 2015, the year after the City Council approved the 56 percent increase to save the Laborers pension fund, the telephone tax generated $110.8 millions, officials said.

One year later, the annual take dropped to $97.3 million as more and more Chicagoans gave up their land lines and relied only on cell phones.

This year, the mayor’s budget projects a continued drop to $95.4 million – but that was before the Illinois General Assembly quietly approved an increase in the waning hours of the spring session. It flew in under the radar because it was tucked away into a broader telecommunications bill that covers funding for 911 emergency centers across the state.

Blind-sided aldermen who must approve the increase accused the mayor and state lawmakers of pulling a fast one and “slipping one through in the bottom of the ninth inning,” as Ald. Brian Hopkins (2nd) put it.

“People get angry when they think there’s any end run to increase taxes when no one is looking,” he said.

Hopkins said he was already “seeing an increase in people using addresses where they don’t actually reside” to try to avoid the telephone tax.

“There’s a point of diminishing returns on this. And we may actually be getting there with this increase,” he said.

But Ald. Scott Waguespack (32nd), chairman of the council’s Progressive Caucus, predicted Friday the mayor would have no trouble lining up the 26 votes needed for passage. The tax increase would bring in roughly $27 million in annual revenue.

“The fact that we’ve raised the telephone tax a couple of times in the last few years means there will definitely be questions and some resistance. But he’ll have the votes,” Waguespack said.

Also on Friday, the mayor appealed to his old friend, Gov. Bruce Rauner, to drop his veto threat and sign the revised school funding that would give the broke Chicago Public School system an extra $300 million this year and even more in subsequent years.

“I would say to the governor on education, ‘You have a once-in-a-lifetime [opportunity] to re-write — and not just re-write — right a wrong that has existed for decades,” Emanuel said.

“Everybody knows the education funding is inadequate in Illinois and the formula is fundamentally broken and discriminatory. He has a unique opportunity to be the governor [who] changes that course that people have talked about for decades . . . I would suggest that the governor read the bill and see this as an opportunity to get something done that has been elusive to everybody else.”