Citing his approval of furloughs, layoffs, and other efficiencies, Chicago Mayor Richard Daley likes to suggest that he offset the enormous 2009 deficit through belt-tightening. But when it comes to the story of how he kept the city running this year, these "management&...
Citing his approval of furloughs, layoffs, and other efficiencies, Chicago Mayor Richard Daley likes to suggest that he offset the enormous 2009 deficit through belt-tightening. But when it comes to the story of how he kept the city running this year, these "management"-related savings (about $70 million in total) played a fairly minor role. The reality is that Daley largely plugged the budget shortfall by way of revenue from the leases of the city's Skyway and parking meters. And those funds are not going to be nearly as plentiful come 2010.
In a new analysis conducted for the SEIU Illinois Council (which sponsors this website), Robert Ginsburg, Ph.D. and Don Wiener, Ph.D. found that this year's city budget relied on $497.9 million in proceeds from the asset deals. Specifically, Daley used $86.2 million in Skyway funds, $338.7 million from the parking meter lease, and $73 million from the botched Midway privatization effort.
But as the table below shows, the city's preliminary budget for 2010 anticipates only $167 million in revenue from these same sources:
So what does all this mean?
It means Daley has, for years now, been building a house of cards. Rather than facing the problem head-on and developing new sources of revenue, the mayor has chased short-term fixes. He has leased valuable public assets despite evidence that the deals represent a long-term loss to taxpayers. Meanwhile, he has watched hundreds of millions in public dollars flow towards his tax increment financing (TIF) fiefdom. Apparently, he is just crossing his fingers that the Olympic bid or a rejuvenated economy will save him from this downward spiral. In the midst of all this, the mayor has asked city workers to sacrifice again and again, despite the fact that the resulting savings are neglible.
If the preliminary budget is any indication, he may have to think bigger -- and more responsibly -- come next year.
Sources for asset sale data
- City of Chicago "Asset Lease Agreements" website
- Office of Management and Budget May 7, 2009 press release
- Office of Management and Budget July 30, 2009 press release