Progress Illinois breaks down Chicago Mayor Rahm Emanuel’s 2017 budget address and rounds up reaction to his proposals, including new police hires, the creation of a community investment fund and other initiatives.
Chicago Mayor Rahm Emanuel formally presented his $8.22 billion budget proposal Tuesday, calling it a “budget unlike any other we have seen in recent memory” in the city.
“It is a budget free of an immediate pension crisis, free of the black could of insolvency threatening the retirements of city employees and the financial future of Chicago,” Emanuel said during a speech before the Chicago City Council.
“For the first time in a long time, all four Chicago pension funds have dedicated and reliable revenue sources and new city employees will share responsibility for funding their benefits,” he added.
Emanuel was referring to the various taxes and fees, including a record property tax increase, that have already been approved to address the unfunded liabilities in the city’s police, firefighters, laborers and municipal pensions funds.
“Five years ago, Chicago was on the financial brink,” Emanuel said. “Today, Chicago is back on solid ground.”
The city faces a $137.6 million budget shortfall in 2017. That’s the smallest budget gap in nearly a decade and 80 percent lower than in 2012, according to the Emanuel administration.
To close that gap, Emanuel is seeking $25.4 million in revenue through new taxes and fees. The proposals include a 7-cent fee on disposable shopping bags and new pilot programs to increase the price to park at special events and make motorists pay to use downtown loading zones.
Laurence Msall, president of the Civic Federation, a non-partisan government watchdog group, said the mayor’s 2017 fiscal blueprint is a “good news budget” for the city.
“He’s still able to provide additional funding for police and public safety,” Msall told reporters after Emanuel’s speech. “He’s doing it not through any major tax increases but through efficiencies and natural revenue growth in the budget.”
Ald. Carrie Austin (34th) agreed that the budget is “not as heavy lifting as it has been in the past.”
“I think this one, without as much heavy taxes and fees that are in our budgets normally, (the public will) be pretty pleased with this,” she told reporters.
The budget depends on $33.7 million in spending cuts and government reforms through energy savings, reductions in copier leases and printing costs and the sale of excess city-owned land, among other initiatives. Additionally, the budget includes $82.3 million in revenue growth from vehicle stickers, permit and license fees as well as sales tax, lease tax and other tax collections.
Another $86.4 million would come by way of sweeping aging revenue accounts, implementing “treasurer investment reforms” and surplussing some tax increment financing funds.
Amid mounting pressure from the Chicago Teachers Union and allied groups, the mayor will release $175 million in TIF surplus funds, $87 million of which will go to the Chicago Public Schools and $40.5 million to the city of Chicago.
The $175 million TIF surplus was a component of the tentative contract agreement reached late last night with the Chicago Teachers Union. Emanuel addressed the tentative deal at the top of his budget speech.
“Both sides worked in good faith to reach a good deal. As a result, Chicago’s students are in class today where they belong, getting an excellent education from dedicated and very capable teachers here in Chicago,” the mayor said. “Chicago Public Schools’ finances will be on stronger, firmer ground because of this agreement.”
The Brighton Park Neighborhood Council was among the groups that pushed the mayor to surplus TIF funds to help avert a potential teachers strike and alleviate school budget cuts. While the group said it was “grateful for this victory,” it said the fight continues for full funding for special education, wraparound services, violence prevention programs and smaller class sizes.
“By not restoring the thousands of school positions and programs that were cut over the summer, we are undermining any chance of developing an effective violence prevention strategy in our communities and denying students of essential mentors,” the organization said in a statement.
The Grassroots Collaborative also released a statement after Emanuel’s budget address. The group expressed support for the TIF surplus, though it said the mayor could do more to make corporations and the wealthy pay their “fair share” in taxes.
“Mayor Emanuel continues his streak of asking working families to pay more while the most wealthy continue to not pay their fair share,” said Grassroots Collaborative Executive Director Amisha Patel. “This is not sustainable. Plastic bags are not going to generate the resources needed to address the economic and racial inequality driving so much of the violence in our communities. It is our hope that we can build on the release of additional TIF funds and win more substantial progressive revenue in the near future.”
As for new initiatives, the mayor’s budget calls for the hiring of additional police officers. Specifically, the city wants to hire 250 police officers, 92 field-training officers, 100 detectives, 37 sergeants and 50 lieutenants next year. In all, the Chicago Police Department plans to hire a total of 970 new officers over the next two years.
Some aldermen wanted more specifics on how the police hiring plan will be funded.
“The devil’s gonna be in the details. As with every budget, (it’s) how are we gonna take care of these priorities?” said Ald. John Arena (45th), a member of the Progressive Reform Caucus, which has called for “fair revenue options” for the city.
“Again, happy to see that we’re finally talking about hiring cops, (something) the Progressive Caucus has called for the last five years,” Arena said. “We have to accelerate that and make sure we get these folks trained and on the street as soon as possible to help expand and reinvent our community policing strategy.”
Emanuel also wants to spend over $64 million on youth programs, up from the $21 million spent on such initiatives in 2011. That $64 million includes $6 million for mentoring programs, an amount that will be matched by corporations.
The Emanuel administration wants to provide an adult mentor to over 7,200 young men in the city’s 20 most violent communities. By November, Emanuel said 4,000 young men will have an adult mentor as part of the “three-year commitment to expand proven mentoring programs in Chicago.”
Another key component of the mayor’s budget is the creation of a Chicago Community Catalyst Fund, which will provide investments for businesses and community projects in the city’s most “resource-starved” neighborhoods, Emanuel said.
“The city will invest $100 million in this fund over the next three years,” the mayor explained. “I have asked and charged Treasurer Kurt Summers, the chairman of the fund, to raise private capital so that additional private investment could double or triple the ultimate size of the fund.”
The budget also seeks to modernize the city’s 3-1-1 system. When the new system becomes fully operational by 2019, residents will “be able to tweet and text the system, and receive real-time updates on neighborhood service requests,” according to the mayor’s office.
Ald. Roderick Sawyer (6th), chairman of the council’s Black Caucus and a Progressive Reform Caucus member, said the mayor’s speech was “good,” though it lacked specifics on how the various initiatives will be financed.
“The overall concern I have is: How do we pay for all this?” the alderman said. “I want to make sure that we’re on solid ground with that. We didn’t get a lot of substance about the revenue sources that are coming in this new balanced budget. But overall, I am encouraged by what I heard today. (There are) a lot more investments in neighborhoods, which I desperately need and a lot of my colleagues desperately need.”
Arena said he was intrigued by the proposed Chicago Community Catalyst Fund.
“I’m interested in finding ways of how to bring prosperity into the neighborhoods,” he said.
However, $100 million is “a considerable sum,” Arena said. “We need to know where that money is gonna come from. We can’t be trading off services for that. We need to make sure that we’re getting that investment into those communities that desperately need it, but we need progressive revenue sources.”