Representing a significant voting bloc, 33 Democratic state lawmakers – 20 in the Illinois House of Representatives and 13 in the Senate – introduced a bill today in a renewed effort to strike a compromise with Chicago Mayor Lori Lightfoot and advocates working to address the budget deficit while also creating major dedicated funding to address homelessness in Chicago.
The legislation, SB 3243 (with a companion House Bill to be filed later today), preserves all of the money that Lightfoot is seeking to trim the city’s budget deficit while generating a projected $79 million to curb homelessness, which now afflicts more than 86,000 Chicagoans. The legislation would modify Lightfoot’s quest to increase the Chicago’s Real Estate Transfer Tax (RETT), adjusting proposed rates assessed on the properties sold for more than $3 million, while extending a tax cut to 96 percent of average annual property sales in the city.
The bill largely parallels a concept championed by a group of Illinois Senators during last fall’s veto session, when Lightfoot’s bid for General Assembly approval of the tax increase faltered due, in part, to the qualms of legislators who want the measure to fund affordable and supportive housing for people experiencing homelessness in concert with reducing the budget gap.
Lightfoot, herself, embraced a proposed RETT increase to unleash new funding to combat homelessness while campaigning for mayor. This is one reason state legislators believe a compromise could be possible with her administration.
“We can’t emphasize enough that this legislation will produce a win-win outcome that would significantly reduce homelessness in our city and help address the city’s budget deficit,” said State Senator Ram Villivalam (D-8th). “Along with several of my colleagues and the Bring Chicago Home coalition, I look forward to collaborating with both the Mayor and the Governor to get this done.”
The legislation is estimated to yield $88 million that would be pledged to deficit reduction and $79 million dedicated to shrinking homelessness. To amass those revenues, the bill would honor the core integrity of Lightfoot’s proposal to charge a transfer tax on a graduated scale, adjusting the rates applying to only two tiers of high-end property sales. For sales over $3 million, it would increase the rate from 2 percent to 2.8 percent, applying only to the portion of the transaction between $3 million and $10 million. For sales over $10 million, it would increase the rate from 2.55 percent to four percent, applying only to the portion of the transaction exceeding $10 million.
For all other sales tiers, the rates would remain identical to Lightfoot’s proposal, ensuring a tax cut for properties purchased for less than $1 million – equivalent to 96 percent of the city’s average annual real estate transactions.
Conversations between legislators, advocates, and the mayor’s office are ongoing, but no agreement has been reached. State legislators hope the introduction of the bill will be an impetus to bring the two sides closer together.
“If passed, this bill will create resources for affordable housing that will help shrink the shortage of 120,000 affordable units in the City of Chicago and have a significant impact on reducing homelessness,” said State Representative Delia Ramirez (D-4th), the lead sponsor of the bill in the House. “At the same time, it will give a tax cut to 96 percent of property transactions in the city and preserve the mayor’s progressive tax structure. Now is the time to come together to get this done.”
While aid to the homeless has increased marginally during the Lightfoot administration, it still ranks near the bottom among the 10 U.S. cities with the largest homeless populations, accounting for only .08 percent of what New York City allocates to the problem and 6 percent of what Los Angeles spends.
Meanwhile, homelessness in Chicago continues unchecked, affecting nearly 14,000 people who are currently working, more than 18,000 who have some college education, and more than 20,000 children, many of them struggling to stay in school, according to a 2019 analysis compiled by the Chicago Coalition for the Homeless.
I’ve asked Mayor Lightfoot’s spokesperson for comment and I’ll let you know what they say. Lightfoot has rejected past attempts at doing a deal, but she needs that money.
- Common Sense - Tuesday, Feb 11, 20 @ 12:52 pm:
There is not an “affordable housing crisis” in Chicago.
Rents have risen fast in two neighborhoods: Pilsen and Logan Square. This does not mean there’s a systemic lack of cheap rent.
There are hundreds of square miles of cheap housing in Chicago. You can buy a home for $10,000 in some neighborhoods. Is it Lincoln Park? No. But not everyone can live in one neighborhood.
- Common Sense - Tuesday, Feb 11, 20 @ 12:55 pm:
One major cause of increased rents is increased property taxes.
The legislators demanding “affordable housing” could reduce property taxes and rents would decrease.
- Captain Obvious - Tuesday, Feb 11, 20 @ 1:00 pm:
86,000 seems a tad high.
- Bourbon Street - Tuesday, Feb 11, 20 @ 1:19 pm:
==86,000 seems a tad high==
The number seems high if you only think in terms of people living on the street, in tents, or in shelters. However, the definition of “homeless” includes people who are temporarily living with someone else, and anyone without a fixed address.
- Common Sense - Tuesday, Feb 11, 20 @ 1:22 pm:
Under that definition I was “homeless” when I crashed with my buddy for two months when I first moved to Chicago before college. Ridiculous definition.
- Montrose - Tuesday, Feb 11, 20 @ 1:26 pm:
“Under that definition I was “homeless” when I crashed with my buddy for two months when I first moved to Chicago before college.”
No. You weren’t. But based on your other comments, I don’t expect you to have the most nuanced understanding of the issues at play.
- Oswego Willy - Tuesday, Feb 11, 20 @ 1:26 pm:
When cobbling 60 and 30, the perfect that Lightfoot sees will only be good if a deal can be reached.
My hope is Leader Durkin and the caucus explain how their 44 ain’t 60, and when 33 or so can find a deal with you, you take it very seriously.
- Precinct Captain - Tuesday, Feb 11, 20 @ 1:31 pm:
==- Common Sense - Tuesday, Feb 11, 20 @ 12:52 pm:==
Your nickname should be Total Nonsense because that’s what you are spouting. Facts tell a much different story.
https://www.chicagotribune.com/columns/blair-kamin/ct-biz-affordable-housing-chicago-kamin0424-story.html
- Just Me 2 - Tuesday, Feb 11, 20 @ 1:32 pm:
All these progressive programs are to fix a symptom of a much larger problem. These progressive politicians should focus on the underlying problem, which is a lack of jobs, due in large part to bad tax policies that squeeze employers at every available opportunity.
- Rich Miller - Tuesday, Feb 11, 20 @ 1:32 pm:
===Ridiculous definition===
Ridiculously redefined definition.
- City Zen - Tuesday, Feb 11, 20 @ 1:45 pm:
In Chicago, the seller also pays $1.25 per $500 RETT but that portion goes to the CTA. In real estate, everybody gets something.
- Da Big Bad Wolf - Tuesday, Feb 11, 20 @ 1:45 pm:
===These progressive politicians should focus on the underlying problem, which is a lack of jobs===
There are a lot of jobs in Chicago. Many homeless people already work. Also large percentage of homeless people are children and disabled.
- Just Me 2 - Tuesday, Feb 11, 20 @ 1:45 pm:
Another hidden cost of housing is the ridiculous delays the City imposes on developers. I have a client who waited 10 months to get an green light for a 30 unit apartment building. Developers are still burning cash waiting for that approval and have to make that money up with charging higher rents.
- Sure thing - Tuesday, Feb 11, 20 @ 1:54 pm:
Hmm trying to remember when a solution to a problem in Chicago did involve a tax increase.
- Chris - Tuesday, Feb 11, 20 @ 2:01 pm:
““Under that definition I was “homeless” when I crashed with my buddy for two months when I first moved to Chicago before college.”
“No. You weren’t“
He wasn’t, just as I wasn’t the … 6? 8?… times in four different states that I was “doubled up” or otherwise not on a lease, nor an immediate family member of the leaseholder.
Nonetheless, it is accurate to say that the definition used to get that 86,000 number *could* include 20-something white dudes, in transitional life periods, and *does* include some substantial number of people who are “doubled up”, etc, and would likely be so barring a radical expansion of public-housing priced (that is, nearly free) rentals of adequate size, in proximity to the family/support-network who have been allowing them to double up.
It really bothers me when, like here, bad numbers are puffed up with ‘less badly off’ but possibly similarly situated people to make the problem look more severe (when it is already a severe problem). compare to many sorts of mass torts actions, “waste fraud and abuse”, $250,000 public pensioners, etc. Everybody does it, and I think it does damage to the truth.
- Da Big Bad Wolf - Tuesday, Feb 11, 20 @ 2:12 pm:
===Everybody does it, and I think it does damage to the truth.===
The truth does damage to the truth?
There is a difference between camping for recreation and camping because you have no place to live. And there is a difference between sleeping on a friend’s couch to visit and have fun and sleeping on a friend’s couch because you have no place to go.
- Roman - Tuesday, Feb 11, 20 @ 2:14 pm:
== When cobbling 60 and 30 ==
Always the right prize to have eyes on, OW. But I’d advise the mayor to strike a deal on how the money is spent with an ordinance in the City Council first, then come to Springfield with a “clean” graduated real estate transfer tax bill. Messy either way, but I think she is better positioned to do deal cutting on special interest diversion of the money in the council chamber.
- I understand the methodology. - Tuesday, Feb 11, 20 @ 2:41 pm:
“Under that definition I was ‘homeless’ when I crashed with my buddy for two months when I first moved to Chicago before college.”
In the event that your buddy identified you as a household member, the homeless count excludes non-relatives (such as “friends” or “visitors”). It excludes roommates/housemates, roomers or boarders, and anyone in institutions or group lodging situations. The definition is extremely limited.
- Da Big Bad Wolf - Tuesday, Feb 11, 20 @ 3:01 pm:
== Nonetheless, it is accurate to say that the definition used to get that 86,000 number *could* include 20-something white dudes, in transitional life periods,===
It’s interesting that you mention this. Children transitioning into adulthood are vulnerable to being homeless if they are kicked out of the family home abruptly. They are adult but don’t have the skills or network to live on their own successfully. This is especially true for foster children.
- Earnest - Tuesday, Feb 11, 20 @ 3:03 pm:
>These progressive politicians should focus on the underlying problem, which is a lack of jobs,
Back in the 90s when they enacted TANF the various workforce investment agencies (JTPA was the name at the time, maybe?) were pleased to see success helping people on the former “welfare” program get jobs.
Then they started seeing problems with retention. Rather than assume the people were lazy because they’d been on welfare, they took a closer look. People were missing work because they had unstable housing, medial issues, no money to deal with medical or transportation expenses that might hurt their work attendance. The lack of money was a combination of previous debt and also lack of skill and experience budgeting. They concluded that, besides helping people get the job, help establishing stable housing, medical care and financial management were needed.
I agree that the business/jobs sides is important. I also think there are investments on the human services side that can generate measurable results.
- supplied_demand - Tuesday, Feb 11, 20 @ 3:29 pm:
Common Sense: “There is not an “affordable housing crisis” in Chicago.”
also Common Sense: “One major cause of increased rents is increased property taxes.”
Which is it? The problem doesn’t exist or the problem is caused by property taxes?
- Common Sense - Tuesday, Feb 11, 20 @ 3:51 pm:
^ Those statements aren’t mutually exclusive. Most rents have increased in Chicago the alderman approved over $700 million in property tax increase to address pension funding.
Yet Zillow currently lists a 3 bed / 2 bath house next to the Cermak L stop for $989. Use a different adjective other than “crisis”. It’s not a crisis.
- Da Big Bad Wolf - Tuesday, Feb 11, 20 @ 4:29 pm:
== Yet Zillow currently lists a 3 bed / 2 bath house next to the Cermak L stop for $989.==
Didn’t see that one. I counted 7 houses under $10,000. Here is a house for $8000: “Due deterioration from the hole in the roof, the property is in need of a total rehab, the floors are bulked and there is a high concentration of MOLD. Drive by only.”
So yes places for 7 homeless families who happen to have $8000 cash and don’t mind sleeping in the cold and rain with mold.
- All This - Thursday, Feb 13, 20 @ 5:51 pm:
Common sense, there is no house on Zillow for $989. You might see some tear downs on vacant lots. These are not habitable homes. And people aren’t homeless just because they can’t afford Lincoln Park. But people do have to live close enough to commute to their jobs. That means living in areas near a lot of economic activity.