City’s proposed budget will erase $1.2B shortfall without federal help: mayoral aides
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.
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.
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 . . . . A lot of cities across the country have had significant numbers of personnel actions,” 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 SunTimes 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.”
Jennie Huang Bennett