Mayor Brandon Johnson is now proposing hiking Chicago property taxes by $150 million, down from his original $300 million recommendation for 2025 that was unanimously struck down by the City Council last week.
But he stopped short Tuesday of saying he has the votes in the council to pass even the smaller increase.
Johnson’s new proposal closes the remaining $150 million hole in next year’s budget by instead raising taxes on streaming subscriptions and the digital lease of “cloud” computing space. As negotiations over the $17.3 billion package continue, the proposal is just that — a proposal — the mayor insisted Tuesday.
“This is not the final budget,” Johnson said at a City Hall news conference. “My responsibility is to present a budget that’s balanced. Working with the City Council to actually pass that budget requires me to remain as collaborator-in-chief.”
Johnson last week described the $300 million property tax he broke a campaign promise to initially propose as a ploy to “get people’s attention” once it became clear the City Council would reject the measure. Aldermen united for a rare 50-0 vote to defeat the tax at a special meeting Thursday.
It’s a common tactic for the mayor and aldermen to present a large property tax hike proposal, then reduce it so they can make the case to homeowners that they spared them an even bigger financial hit. Asked Tuesday if the property tax could come down even further, Johnson emphasized once again that negotiations continue.
He touted his efforts to work with the City Council and said he has reached out to every aldermen about the budget. He described that outreach as an “unprecedented” effort not undertaken by past mayors. He also took a shot at the aldermen accusing him of leaving them outside the budget process to suggest they are the ones not engaging in dialogue.
“This is not a one-way street. It’s a two-way street,” Johnson said. “There are some individuals who, their engagement has been slower. We have slowed things down for those individuals who are, you know, adjusting to a new process.”
Johnson’s new budget plan hinges on three major tweaks, none of which include the many tax and fee ideas being floated in the City Council to raise potentially even more money.
In the new proposal, the personal property lease tax on cloud computing services would rise to 11%, bringing in an additional $128 million, Chief of External Affairs Kennedy Bartley told the Tribune. An increase in the tax on streaming services would bring in around $10 million, while “efficiencies” to the city’s spending of federal COVID-19 stimulus money would save $14 million, without personnel or program cuts, Bartley said.
Johnson described the two proposed hikes as “an opportunity to generate revenue from corporations or wealthier spaces.”
“Because that’s the ultimate goal is to have progressive revenue, right?” he said.
He also stood firm behind his flat opposition to service and personnel cuts and promised to fight for more revenue at the state level, an apparent nod to the so-called “millionaire tax” that would add a 3% income tax surcharge to net income over $1 million.
Whether or not Johnson’s new plan can pass remains to be seen. Many aldermen have shared firm opposition to any property tax hike, especially one that comes without cuts to the city’s workforce.
Asked if he had the 26 votes needed to pass the proposal, Johnson pushed back against the question, then said: “We are still in the process of negotiating.”
jsheridan@chicagotribune.com
