Chicagoans vented their frustrations over items in Mayor Rahm Emanuel's 2016 budget proposal, including a record $588 million property tax hike, during a Thursday night town hall meeting hosted by the city council's Progressive Reform Caucus.
In addition to the proposed property tax increase, the three progressive caucus members at the meeting, Alds. Scott Waguespack (32nd), Nicholas Sposato (38th) and John Arena (45th), got an earful from residents about Emanuel's proposals to privatize the city's 3-1-1 non-emergency operations and increase fees on taxi cabs and ride-hailing services, like Uber and Lyft.
Emanuel wants to outsource 3-1-1 operations to save the cash-strapped city an estimated $1 million annually.
Debra Powell, a 3-1-1 operator of 10 years, said the privatization plan could cost 58 call center jobs and negatively impact the quality of service provided to Chicagoans.
"You don't know who you're going to be talking to when you call 3-1-1 and it's been outsourced," Powell said at the budget town hall meeting, held at the Copernicus Center on the Northwest Side. "I would rather speak with someone who lives in the city, born and raised, knows the neighborhoods. We have ... 58 operators there who live all across the city, ... so we pretty much can relate to all the residents calling in."
This week, news surfaced that the mayor is also weighing the possible privatization of the city's HIV/AIDS services.
Waguespack told the crowd that the council's 11-member Progressive Reform Caucus will fight against the privatization proposals.
"I can tell you, based on experience from everything from the parking meter deal to water services, when you look to privatize things like 3-1-1 or HIV and AIDS services, it is all about profits," Waguespack said. "It is not about people, and we are pushing back on that, and we hope that you will too."
In remarks after the meeting, Sposato said he is optimistic that the 3-1-1 privatization plan will eventually get dropped from Emanuel's budget, as the proposal has not been received well in the council.
"Everybody seems to be against it. Even staunch supporters of (Emanuel's) that he can count on, they seem to be against it," Sposato said.
As the cash-starved city grapples with large financial issues, including a $30 billion pension crisis, progressive caucus members have offered a list of city revenue options aimed at not overburdening Chicago families and middle class homeowners. Some of the ideas presented by the caucus ahead of the mayor's budget address last week include a luxury tax, reforms on tax increment financing, changes to the sales tax, and a "stormwater stress tax" for large retailers and institutions.
Other budget ideas floated by the Progressive Reform Caucus at Thursday's meeting included raising the fee for sidewalk cafe permits and consolidating the Chicago Board of Election Commissioners with the Cook County Clerk's Office.
The aldermen have also called for an alternative minimum property tax for buildings in the downtown central business district.
An alternative minimum property tax "would set a floor where (central business district buildings) cannot contest their property taxes below [that level], and set a base line of revenue that we know we can count on as a city," Arena said. "It would increase how much we can extract from property tax revenue from the downtown business district, where there's money to be had, as opposed to putting it onto the residential and neighborhood commercial properties."
Arena said the Emanuel administration has provided "positive feedback" on the alternative minimum property tax proposal, which the "mayor actually acknowledged as having merit very early on in the [budget] process."
However, the idea is not included in Emanuel's budget.
"It is something I think we have to work with the state in order to implement," Arena explained, adding that an alternative minimum property tax could be something to tackle as part of a long-term funding plan for the city.
Waguespack acknowledged that several other revenue solutions favored by the Progressive Reform Caucus would need approval in Springfield, which is entrenched in its own budget battle.
"We've asked people in Springfield to let us have these options to change the way that we fund our city and we fund our state," the alderman said. "We've asked for a graduated state income tax, a graduated city income tax, a corporate income tax and a financial transaction tax" on the Chicago Mercantile Exchange and the Chicago Board of Trade.
The caucus also supports broadening the sales tax, a revenue idea Emanuel discussed during the last election. Prior to his re-election, Emanuel had also called for a Chicago casino to help cover the city's pension costs.
"None of those things have been accomplished, so what we've ended up with is a property tax hike that looked like $400 million just a few weeks ago and is now up to $588 million," Waguespack stressed.
Emanuel's budget recommends a $543 million property tax hike, to be phased in over four years, that would go toward the city's woefully underfunded police and fire pension funds. Under the plan, property taxes would go up by $318 million this year, $109 million in 2016, $53 million in 2017 and $63 million in 2018. An additional $45 million property tax increase would be used for construction at Chicago public schools.
Northwest Side resident Gary Bonikowski said the proposed property tax hike would burden him financially unless it is coupled with some homeowner relief.
"I was property taxed out of my previous home in another neighborhood, so I moved to the Northwest Side 14 years ago," he told the aldermen. "Now, there's a possibility I'll be property taxed out of this house ... I'm on a fixed income. My utilities go up every year. Food goes up every year. Meds go up every year. My income does not go up every year."
In an effort to ease some of the property tax pain for Chicago homeowners, Emanuel is hoping the state legislature will act on lifting the homeowner exemption. But even if state lawmakers OK Emanuel's homeowner exemption proposal, it would still need the support of Republican Gov. Bruce Rauner, who is pushing for a state property tax freeze.
Under the mayor's homeowner exemption plan, owners of homes worth no more than $250,000 would be spared from the $543 million property tax increase.
There are also tax rebate proposals pending in the council, including one from the progressive caucus, that would reduce the property tax impact on low- to moderate-income homeowners.
Meanwhile, Emanuel's budget also seeks higher fees on taxi cabs and ride-hailing services. Under the mayor's budget, ride-hailing companies would also gain access to Midway and O'Hare airports, with the city getting $5 for every pick up and drop off. For taxis, fares would increase by 15 percent.
John Hilt, a Chicago cab driver of 25 years, blasted Emanuel's proposal to open up the airports to Uber, Lyft and other ride-hailing companies, saying such a move would take "away the reliable income that taxi drivers have."
"The city can raise more revenue by leveling the playing field and making Uber follow the same rules that I follow," Hilt said. "A 15 percent fare increase is nothing compared to what we are losing. A 15 percent fare increase would only make taxis less competitive, and we don't want it right now until taxis and the ride-share cars are playing by the same rules."
Mia Barnett, a Lyft driver of more than two years, urged aldermen against a fee hike on ride-hailing services. She stressed the important role such transportation options play in Chicago communities underserved by taxis.
"I would challenge our cab industry to step up to the plate, modernize and improve their services, so that they can compete with Lyft and other companies," she added.
Also at the meeting was freshman Ald. Gilbert Villegas (36th), who is not a Progressive Reform Caucus member.
As a new alderman, Villegas said he attended the meeting to learn more about the budget process.
Asked whether he plans to join the Progressive Reform Caucus, Villegas would only say, "As it relates to being a member of any (caucus), I don't have to be part of a caucus to be progressive."
Progressive Reform Caucus members are set to hold a second budget town hall meeting on October 6 at Southside Occupational Academy High School, 7342 S. Hoyne Ave. The event, which is free and open to the public, starts at 6:30 p.m.