Minutes before mayoral candidate Jesus “Chuy” Garcia gave a press conference to discuss his budget plan for the city of Chicago, Mayor Rahm Emanuel released his “fiscal framework” for the city.
Emanuel targeted Garcia’s lack of specifics, saying “voters deserve clear proposals on how the candidates are going to address the looming pension crisis, which is also the cause of the growing budget deficits we face.”
Pension reform was a main part of Emanuel’s budget plan, and included slowing growth rates for city pensions and increasing employee and taxpayer contributions.
Emanuel maintained that he plans to keep the current retirement age for public employees and protect retirees with lower pension income.
“These reforms will reduce our required 2016 pension payment obligations for the police, fire and teacher pension funds from more than $1 billion to a more manageable $300 million in additional payments on top of our current obligations,” Emanuel said.
As for added revenue to fill the pension and budget hole, Emanuel also said he plans to control the cost of health care, find better ways of providing government services, reforming teacher pension fundings, closing state tax loopholes, continuing a TIF surplus policy, exploring non-tax revenue options like a gaming proposal and reforming the worker compensation system.
In his four years in office, Emanuel has offered a budget each year that doesn't include a property tax increase, but this year’s plan also does not exclude that possibility.
Emanuel instead claims a property tax would be a “last resort.”
“Any serious candidate running for mayor needs to be honest with voters,” Emanuel said in a statement.
“Claiming that we can solve the problem of righting our financial ship with taxes on LaSalle Street or commuters are legal nonstarters. And while tax increment financing (TIF) surplusing has played a role in balancing our budgets for the last four years, it is not alone a silver bullet solution.”
On Friday, Garcia outlined four areas where he believes the city could save money, but noted those savings were not enough to fix several budget shortfalls. Those areas included more efficient services for city residents, transparency and public accountability, comprehensive reforms and collaboration between county and city agencies.
Garcia said he does not support reducing pension benefits for current or retired city employees.
“I recognized that a part of the pension solution is going to be additional and new revenues but we owe it to taxpayers to look at a whole host of possibilities that experts will provide me with as we move forward,” he said.
Garcia avoided saying whether tax increases would be implemented under his budget instead saying he plans to first plans to appoint a committee to review the city’s budgeting.
“Everyone understands that the fiscal crisis in Chicago is severe,” Garcia said. “This will be a top priority of mine on the first day of the transition process April 8.”