Capitol Fax.com - Your Illinois News Radar » *** UPDATED x1 *** Lightfoot says city faces $838 million spending gap, says committed to a graduated real estate transfer tax
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*** UPDATED x1 *** Lightfoot says city faces $838 million spending gap, says committed to a graduated real estate transfer tax

Thursday, Aug 29, 2019 - Posted by Rich Miller

* The full speech is here. Press release…

Mayor Lori E. Lightfoot today addressed residents on the state of the City, the City’s finances and the projected 2020 budget deficit during a live primetime speech delivered at Harold Washington Library. In an unprecedented act of transparency before the official City budget address in October, the Mayor appeared before residents to provide an overview of the city’s current financial state, including: a historic $838 million gap projected for 2020, measures taken to date to address the City’s long-term and short-term financial obligations, and the work remaining to put Chicago on track for a balanced and sustainable financial future.

During the speech, Mayor Lightfoot outlined her vision for strengthening the City by building stronger and safer communities, expanding access to education and vital services, and creating opportunities for working families – starting first by working to create structural reforms within City government that will contribute to Chicago’s long-term financial stability. Importantly, her reforms strive to make Chicago work for working-class families and create a model of good governance. These reforms include: fines and fees reforms, passing the Fair Workweek and an Ethics ordinance, and ensuring that Chicago remains a welcoming City.

“Today I am shining a light on Chicago’s current financial conditions. I want residents to know the full extent of the City’s finances and the path we plan to take to address our long-standing fiscal challenges,” said Mayor Lightfoot. “The 2020 Corporate Fund budget shortfall will be $838 million. And while I recognize this is a steep hill to climb, I am committing to residents that, together, we will do the hard work of finding sustainable solutions that will lead our city to long-term financial stability.”

In the address, the Mayor outlined her administration’s efforts to identify over $100 million in savings and efficiencies over the first 100 days and the work that remains to balance next year’s budget. These efficiencies include the elimination of $1.4 billion in short term borrowing, a review of departmental use of overtime and absenteeism, and implementation of a citywide hiring freeze allowing the city to work with departments to identify additional efficiencies in the coming weeks.

The City has begun to make progress in addressing its costs for 2020 and beyond by implementing structural reforms that drive down costs and improve financial stability, including: a complete overhaul of the $100 million workers’ compensation program, which is expected to reduce claims costs and improve services for workers; release of a new healthcare RFP to revisit competitive costs for the $471 million-a-year program; changes to refinance old debt for better rates; and the creation of the first citywide enterprise risk management system, led by Chief Risk Officer Tamika Puckett, which will seek to cut down on the high cost of legal settlements.

And within weeks of taking office, Mayor Lightfoot secured legislative approvals to authorize a casino in Chicago, which would generate a dedicated revenue source to finance underfunded police and fire pensions. The administration is now committed to working with State legislators on the taxation structure to ensure a Chicago casino will represent a structural solution for long-term sustainability.

The 2020 budget forecast reveals that The Corporate Fund, or the City’s operating fund, represented more than $3.8 billion, or more than 34 percent of the City’s $10.67 billion budget in 2019. This forecast reveals that in 2020, the pension, personnel and healthcare costs that make up a significant part of the Corporate Fund expenses will comprise 70 percent of the budget shortfall, while debt and legal settlement costs make up an additional 22 percent of the structural deficit.

As part of the annual budgeting process, the City is utilizing a zero-based budgeting method, where departments formulate 2020 budget proposals to request funding for programs and services in support of their core mission. New investments will be balanced with department savings, reforms and operational efficiencies in an effort to streamline existing processes and uphold a high quality of services for residents across all neighborhoods.

* More…

…Adding… From her speech

We are exploring revenue options to address rampant congestion that solves the problems of traffic, pollution and other issues, while simultaneously bringing in a fair source of funding.

And…


*** UPDATE *** Emily Bittner in the governor’s office…

The governor is committed to creating an environment in the state where all cities can thrive, because Illinois succeeds when its cities succeed. In the weeks ahead, as Chicago pursues assistance from the legislature, it will be important for the mayor to reach out to leaders and lawmakers across the state and across the aisle to build a coalition for her ideas. The governor looks forward to working with these stakeholders as the General Assembly weighs all these ideas carefully.

       

26 Comments
  1. - Amalia - Thursday, Aug 29, 19 @ 6:39 pm:

    think she made a reference to congestion pricing for traffic as both a way to reduce pollution and find funds. I am not psyched for the money pay for that.


  2. - Oswego Willy - Thursday, Aug 29, 19 @ 7:04 pm:

    ===…it will be important for the mayor to reach out to leaders and lawmakers across the state and across the aisle to build a coalition for her ideas. The governor looks forward to working with these stakeholders as the General Assembly weighs all these ideas carefully.===

    This is the best thing to come out after that speech,

    Lightfoot’s Crew needs to take heed;

    Winning a race for mayor doesn’t make any Mayor the important actor to get all they need.

    Getting 60 and 30, and securing a green light from any governor, that’s Lightfoot’s (and her Crew’s) charge.

    Speeches, even well-written / crafted speeches can’t make a General Assembly or a Governor motivated to carry the Chicago agenda.

    Lightfoot’s Crew is letting her down, and Lightfoot herself is crippling her chances.

    The lacking of savvy by both… its tough to watch.

    Today, and Pritzker’s Office response is mere words until Lightfoot and her Crew grasp the task at hand correctly, and stop with public ignorance uttered like dorm room advice.


  3. - RNUG - Thursday, Aug 29, 19 @ 7:26 pm:

    == important for the mayor to reach out to leaders and lawmakers across the state and across the aisle to build a coalition for her ideas. ==

    Translation: Engage brain before speaking. JB may not be a typical politician but you need to quit running your mouth off in public before coming to Springfield and getting a deal.


  4. - Just Me 2 - Thursday, Aug 29, 19 @ 7:57 pm:

    None of her “cuts” include eliminating any programs. Typical liberal. All government programs are of course vital.

    A $100m is a rounding error in the city budget.


  5. - Oswego Willy - Thursday, Aug 29, 19 @ 8:18 pm:

    ===All government programs are of course vital.===

    What should be cut?


  6. - Amalia - Thursday, Aug 29, 19 @ 8:20 pm:

    Rich, thanks for posting the link to the text of the address. so this is the bit about congestion pricing…. “We are exploring revenue options to address rampant congestion that solves the problems of traffic, pollution and other issues, while simultaneously bringing in a fair source of funding.”


  7. - 47th Ward - Thursday, Aug 29, 19 @ 8:23 pm:

    ===A $100m is a rounding error in the city budget.===

    That’s more than 12% of the projected deficit. By how much do you round?


  8. - 47th Ward - Thursday, Aug 29, 19 @ 8:34 pm:

    ===A $100m is a rounding error in the city budget.===

    That’s also about how much we spend to settle lawsuits and legal claims each year. It’s the size of the entire municipal workers’ comp program.


  9. - Roman - Thursday, Aug 29, 19 @ 8:39 pm:

    Emily Bittner’s not-so-subtle advice and Oswego Willy’s take are dead on target. No more Mulligans for the Lightfoot administration in Springfield.

    I just hope they’re not teeing up a Blame Springfield strategy for their inevitable property tax hike.


  10. - Jocko - Thursday, Aug 29, 19 @ 8:52 pm:

    ==None of her “cuts” include eliminating any programs.==

    $838 million comes out to a little over 7 years of police settlements.


  11. - Wow - Thursday, Aug 29, 19 @ 9:19 pm:

    You all do know that the members of the City Council she gave big committees to HAVE NEVER TAKEN A TOUGH VOTE!!
    She needs to get her City Council in line before coming down to Springfield and asking for help


  12. - DuPage Saint - Thursday, Aug 29, 19 @ 9:35 pm:

    Maybe cut back on flag purchases and save a few bucks


  13. - Roman - Thursday, Aug 29, 19 @ 9:37 pm:

    - Wow -

    It pains me to defend Chicago alderman, it really does. But I’m pretty sure all those committee chairs have voted to raise either property taxes, water bills, or 911 fees the last few years. Those are not easy votes.


  14. - Stuntman Bob's Brother - Thursday, Aug 29, 19 @ 9:39 pm:

    So, the Mayor says that “Pensions are a promise that must be paid” and in the same breath, says that “Structural changes are needed for the Pension system to survive” (paraphrased). So, is she strictly asking for State help to pay them? Or, is she asking for the ability to diminish pensions for future workers? Is there another option?


  15. - Oswego Willy - Thursday, Aug 29, 19 @ 9:53 pm:

    ===So, is she strictly asking for State help to pay them? Or, is she asking for the ability to diminish pensions for future workers? Is there another option?===

    That’s the challenge of Lightfoot and her Crew

    1) “What do you want, exactly”
    2) “How do you expect that to happen”
    3) “Why do you insist on speaking to things publicly without trying to work with everyone first”

    The Mayor’s Office needs to be realistic, honest, and broker realistically possible solutions so they can build consensus.

    Otherwise, your observation leads to an answer…

    “I dunno what they expect or how to get it”


  16. - Practical Politics - Thursday, Aug 29, 19 @ 10:00 pm:

    One constant complaint voiced by some police officers is that the City Council is too quick to approve settlements. The egregiously bad cases stand out, but some argue that the City Law Department and the plaintiffs’ bar settle many cases that ought to be contested and that the relations between the lawyers are too cozy much like when Alderman Burke’s Finance Committee was handling workmen’s compensation claims.


  17. - Steve - Thursday, Aug 29, 19 @ 10:05 pm:

    Some people are ready for a graduated real estate transfer tax : some aren’t.


  18. - Not a Billionaire - Thursday, Aug 29, 19 @ 10:35 pm:

    These are two items that could pass but she should have talked to the Gov first.The city is experiencing a decline of traffic volumes in the arterial. I rather doubt the state will let her tax the expressways.


  19. - Downstate - Friday, Aug 30, 19 @ 8:02 am:

    This calls for a city income tax. The Democrats have all the votes for that (in Chicago and Springfield). It seems the most equitable way to solve the deficit.


  20. - lake county democrat - Friday, Aug 30, 19 @ 8:20 am:

    I’m not going to pile on Lightfoot even if she deserves some blame: it’s not like JB and Madigan haven’t given thought to how much and what they are prepared to do to help out Chicago’s budget problem. Lightfoot likely has some insight into that, and this speech can be read as either a prelude to cooperation or a set-up to “blame Springfield” but I suspect she has at least an inkling which.


  21. - Juvenal - Friday, Aug 30, 19 @ 8:27 am:

    My advice is to make peace with her own City Council before coming to Springfield with her hand out. Those aldermen whose votes she does not think she needs in the city council all have allies in the Statehouse in both chambers.

    And take the brick off of Martwick’s bill as a show of good faith.


  22. - City Guy - Friday, Aug 30, 19 @ 8:31 am:

    The opening of the press release says “In an unprecedented act of transparency before the official City budget address in October, the Mayor appeared before residents to provide an overview of the city’s current financial state” I think it is pretty standard for Chicago Mayors to release a preliminary budget showing the budget gap during the summer. I didn’t hear/see anything that struck me as unprecedented. Please correct me if I am wrong.


  23. - Say What? - Friday, Aug 30, 19 @ 9:05 am:

    The Mayor’s problems are a matter of scale. The Legislature must be prepared to offer the same “solutions” to Peoria, Decatur, Danville, Carbondale, Quincy, Rockford, Aurora, et. al.

    Be careful, there is a long line at this trough.


  24. - Da Big Bad Wolf - Friday, Aug 30, 19 @ 9:25 am:

    ==This calls for a city income tax. The Democrats have all the votes for that (in Chicago and Springfield). It seems the most equitable way to solve the deficit.==
    The only candidate who wanted a city income tax, Bill Daley, was soundly defeated.


  25. - Earnest - Friday, Aug 30, 19 @ 10:09 am:

    I like the language Pritzker has been using, tying the conversation to all cities of the state instead of solely Chicago. It speaks to the concerns downstate raises about special deals for Chicago while also emphasizing we’re all in this together. That’s not to say there aren’t unique challenges to Chicago, just as there are for suburbs, cities, small towns, rural areas, etc.


  26. - revvedup - Friday, Aug 30, 19 @ 10:38 am:

    Mayor Lightfoot is the piper nobody wants to pay, and all suggestions for raising revenue will cause angst and wailing. Nor should the entire State be forced to bail them out (some would say yet again) while other communities are left out. The knee-jerk lawsuits settlements need a fresh set of eyes, as well as City expenditures. There must be administrative and managerial positions which can be eliminated through retirements or limited firings. CPD is incredibly rank-heavy, and entire layers of “staff and command” need elimination/


Sorry, comments for this post are now closed.


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