Months after the Chicago City Council narrowly approved the 2025 city budget, Chicago Mayor Brandon Johnson is sending a signal that the next budget season will be as tough, if not tougher.
"We have started our budget process earlier than ever before because the challenges that we face are greater than what we've experienced before. The truth is: Our city is truly at a crossroads right now," Johnson said during a news conference Monday.
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WATCH HEREThe mayor said Chicago is facing a projected budget gap of $1.12 billion in fiscal year 2026 and $1.32 billion in fiscal year 2027, largely due to rising personnel, pension and contractual costs, plus threats from the Trump administration to cut federal funding.
On Monday, Johnson signed an executive order to establish a working group that will provide recommendations to address the city's budget gaps. The working group will include stakeholders from the business community, non-profits, civic organizations, the labor community and the city council.
The executive order also mandated that the Office of Budget Management conduct a thorough review of city operations and programs.
"We need to identify cost savings, but we also have to identify opportunities whether we can streamline operations and improve services that are delivered to our residents. We essentially need to do more with less," Johnson said.
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With a final vote of 27-23, the council narrowly passed the 2025 budget in December a mere two weeks before the end of the year. The vote capped off months of vigorous debate and fierce criticism. The budget plan included a host of taxes, fines and fees, plus spending reductions and adjustments to city staffing.
Ralph Martire, the executive director of the Center for Tax and Budget Accountability, said Chicago's structural deficit wasn't created by one mayoral administration; rather, it was handed down from administration to administration. Martire, who heads the nonpartisan think tank, said the executive order marks an important step toward addressing the problem.
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SIGN UP "We will have the full opportunity to put everything on the table, to look at what has actually created this structural imbalance for decades and finally create a chance to fix it," Martire said.
During the last budget season, Johnson repeatedly said he would not lay off city workers or make cuts to city services. Will those cuts be considered for the 2026 budget?
"They've been on the table for multiple budgets," Johnson told reporters Monday. "We just have decided to move forward in our first couple of budgets without having to do that. That's not how we start the process. The process starts (with where we can find more productivity, where we can find operational strength."
Johnson also said city officials will have to look at revenue opportunities, as well.
The working group is scheduled to present a preliminary report of its findings and recommendations by Aug. 31, 2025, with a final report expected by May 31, 2026.
