In a bid to reach a compromise with aldermen to confirm a budget before an end-of-year deadline, Mayor Brandon Johnson’s administration on Friday proposed a raft of fixes — including expanding a downtown rideshare congestion tax to include weekend trips, boosting the charge on garage and valet parking across the board, and doing away with a promise to continue the city’s guaranteed basic income program.
Johnson’s team has been feverishly negotiating a way to close a gap of $346.2 million after aldermen rejected the mayor’s proposed $300 million property tax hike, his $10.6 million liquor tax increase and plans to cut hundreds of consent decree positions. A Springfield snafu blew another hole in the budget as well.
With the budget process already weeks behind schedule, aldermen Friday were briefed on a series of new taxes — and about $90.2 million in proposed cuts — in the hopes of reaching the at least 26 votes the mayor needs to push through a 2025 package.
Under the proposal, the property tax hike would be cut to $68.5 million, according to sources present at the Friday morning briefing. To help make up the difference, the city would raise $8.1 million by changing the existing surcharge on rideshare trips downtown.
The Downtown Zone Surcharge, first adopted in 2020 under Mayor Lori Lightfoot, is charged on any rideshare trip that starts or ends downtown (roughly the Loop, River North, West Loop and South Loop) on weekdays between 6 a.m. and 10 p.m. While the rate would drop from $3 to $2.75 a day, the city would start charging Saturday and Sunday trips, too.
Johnson’s team officially walked back promises made earlier this year to undertake a second round of his guaranteed basic income program, which would have used $31 million in remaining federal pandemic relief dollars to offer no-strings-attached $500 monthly payments to low-income families. Johnson would also nix a planned $29 million small business program and $14 million in other programming and administrative costs that would have been covered by American Rescue Plan Act dollars.
Sources at the Friday aldermanic briefing said Johnson’s team explained the last provision meant the city would sunset all programs funded by the federal stimulus package — including community violence intervention — by the end of next year.
Requests for Johnson to make cuts to regular operations — including paring back staffing in the mayor’s office — otherwise went largely unheeded. Briefing documents only show $3.1 million in “efficiency” cuts to the department of fleet and facility management, and a $13.1 million reduction in debt service.
The vast majority of the gap would be covered by hiking from 9% to 11% the personal property lease tax — applied to cloud services or software in addition to autos and other leased equipment — bringing in an additional $128 million.
About $21 million would come from various changes to city fines and fees, including an estimated $14 million from an amnesty program for pre-2024 vehicle violations. Raising the price of a sheet of residential parking passes from $8 to $15 would bring in another $1.5 million.
The charge to use parking garages or valets would jump to 23.35%, up from 22% on weekdays and 20% on weekends. That would bring in an estimated $11.3 million.
The tax on streaming services and cable TV would also rise from 9% to 10.25%, bringing in about $12.9 million.
Whether Johnson’s latest tweaks get the mayor to 26 votes is an open question, said Ald. Daniel La Spata, 1st. Though the progressive Northwest Side alderman was happy to see the congestion tax expanded, he mused that most of his colleagues would want to see further cuts.
But the existing cuts are difficult for La Spata to vote for, he said. Eliminating the guaranteed basic income program “solves nothing,” he said. “It only, to me, creates new problems for the city to solve, but I understand for some, cuts were essential for their support.”
Sarah Saheb, director of Economic Security Illinois Action, also issued a statement Friday condemning the change. “This would be a promise broken to Chicagoans at a time when so many are already struggling with rising prices,” Saheb said. “We urge City Council to move forward with a program that will help alleviate child poverty, food insecurity, and homelessness for thousands of Chicagoans while strengthening our workforce and supporting local economies.”
Johnson’s second budget season has seen a long and bumpy road, with no clear end in sight. Negotiations with City Council got off on the wrong foot when his budget team opted to push back the process and schedule the final vote for early December, rankling aldermen across Chicago’s political spectrum who wanted more time to evaluate his spending plan and engage with constituents.
After another scheduling delay, a first vote on the budget could come as soon as Dec. 13, though what will actually go up for a vote remains unclear as resistance from aldermen continues bubbling. Johnson and the council have until Dec. 31 to pass a 2025 or risk an unprecedented budget crisis that could shut down government services and harm the city’s financial standing.
On Thursday, 28 aldermen urged Johnson in a letter to make further reductions in his spending plan to help set Chicago on a “sustainable path.” The public push shows the mayor and aldermen still have far to go as they continue to grapple with the budget and an end-of-year deadline approaches.
But the pro-labor mayor has vehemently refused to consider personnel cuts such as layoffs, arguing Chicagoans do not want reduced services.
Asked Thursday where the process stands, Johnson once again called himself the city’s “collaborator-in-chief.”
The mayor named youth employment, workforce development, mental health care, affordable home construction and safety as priorities. He called layoffs of city workers like police “not a pathway to solvency.”
“It’s very much a still-robust process,” he said. “We’re going to continue to make sure that this process remains open and collaborative.”
One of Johnson’s staunchest critics, Southwest Side Ald. Raymond Lopez, 15th, swiftly came out with a statement after Friday morning’s briefing demanding Chicago return to pre-COVID-19 spending levels. The city’s budget grew from $11.65 billion in 2020 to over $16.77 billion this year, which was Johnson’s first spending plan as mayor.
“This latest round of proposals was not crafted from a true spirit of collaboration with all members of the City Council,” Lopez wrote. “I do not believe this administration has taken seriously our call for reduced spending. I do not feel this administration has put in the work to reduce the non-essential patronage workforce.”
