Lori Lightfoot

Chicago City Council Approves Lightfoot's Budget, Including Property and Gas Tax Hikes

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Chicago City Council voted Tuesday to approve Mayor Lori Lightfoot's 2021 budget plan that includes property and gas tax increases among other revenue-generating and cost-cutting measures to tackle the city's estimated $1.2 billion shortfall.

The property tax hike passed in a 28-22 vote, needing approval of 26 of the 50 total aldermen to pass.

Lightfoot said in announcing her proposal that the $12.8 billion budget closes the $1.2 billion gap, 65% of which she tied to the coronavirus pandemic that has cratered revenues like sales tax and more as shutdowns to prevent the spread of the deadly virus have caused widespread economic devastation.

The property tax increase in the budget plan is twofold: a one-time increase generating $43 million as well as a plan to raise property taxes each year with inflation, tying it to the consumer price index.

The total $93.9 million property tax hike will have an estimated impact of roughly $56 a year on a median home valued at $250,000, Lightfoot said in October.

Lightfoot's plan also includes an increase on the city's gas tax by $0.03, from $0.05 to $0.08 cents per gallon, as well as an increase to the personal property lease tax applied to computer leases of cloud software and cloud infrastructure.

The budget also generates revenue by lowering the threshold to issue $35 speeding tickets to drivers caught on camera going as little as 6 to 9 mph over the limit. Currently, only drivers going 10 mph above the speed limit receive the $35 tickets, with $100 tickets issued to drivers traveling 11 mph or more above the limit.

Lightfoot's plan also saves $501 million by refinancing and restructuring existing debt, the latter a practice utilized by previous mayors that opponents say involves a form of "scoop and toss" that could prove unsustainable and costly in years to come.

Her plan as introduced in October also originally included roughly 350 layoffs of city workers which she later announced would be avoided after working with the Chicago Federation of Labor.

Personnel changes in the budget still include the elimination of roughly 1,900 vacant positions from all city departments, include hundreds in police and fire, as well as five furlough days for some non-union employees. Those personnel changes account for roughly $106 million in savings.

Her proposal also includes $76 million in TIF surplus funding and taking $30 million from the city's Rainy Day Fund.

"To be clear folks, we are not experiencing just a rainy day. It is a rainy season," Lightfoot said when introducing her budget in October.

When it comes to what the budget proposal will fund, Lightfoot said her plan includes additional funding for community-based violence prevention and reduction efforts, which will support the expansion of violence prevention programming and launch a pilot to involve mental health professionals, paramedics and crisis intervention-trained police officers responding to certain 911 calls.

Following months of renewed protests and calls to reallocate funding from the Chicago Police Department to social services and other initiatives, when announcing her budget, Lightfoot again came down strongly in the position she's often repeated.

"I have been very clear that I do not support defunding police," Lightfoot said in October. "I also reject the false narrative that it's either fund the police or fund the community."

She noted that the federal consent decree that the city entered after a scathing 2017 Department of Justice report found a "pattern and practice" of civil rights violations committed by CPD requires certain portions and programming to be funded as part of its court monitored-reforms.

However, roughly 86% of respondents to a citywide survey of more than 38,000 residents voted to reallocate funding from police services to fund other city services - a point several aldermen highlighted in explaining why they would not vote for the budget.

The budget also includes an additional $1.7 million for youth programming, $2 million for affordable housing, as well as $7 million for workforce training and small business assistance, Lightfoot said.

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