Mayor Lori Lightfoot on Thursday entered the living rooms of Chicagoans in a televised address to warn of “hard choices” ahead — and revealed a staggering deficit: $838 million.
That was the main bad news number outlined in a 26-minute speech in which Lightfoot said no options are off the table to tackle the city’s financial crisis.
But, Lightfoot offered that her two principles in guiding her revenue options are relieving the financial burden of those who can least afford it, and working to not drive businesses out of Chicago.
“Some of our solutions will be hard. Yes, they may involve putting ourselves at risk. And if it means that I sacrifice myself politically, so be it in pursuit of the right thing,” Lightfoot said. “We don’t have a moment to lose.”
The mayor did offer some solutions to fill the gap, including a graduated real estate transfer tax; “exploring revenue options to address rampant congestion,” and collecting revenue from the cannabis industry.
Lightfoot too enunciated that a Chicago casino, if done right, will address the city’s long-term problems and won’t serve as a “one-time fix.”
“But we also have to be honest with ourselves. If such an agreement [on a casino] isn’t made, if we don’t secure this casino and the revenue it creates, we will be forced to make painful choices on finding other revenue sources. And we all know what those are, the sources we wish to desperately avoid,” the mayor said.
Later, Lightfoot said the city has historically relied on property taxes to heap in cash: “I want to avoid that measure as much as possible, but if we don’t get the structural changes that our pensions need, we will be presented with very hard and limited options.”
The mayor pegged a pension fix on working with the state, including Gov. J.B. Pritzker and state legislators.
Lightfoot warned of the city’s increased annual cost of more than $200 million for public safety services, and a $400 million increase for municipal and labor pensions next year.
“In other words, no matter what we do for this coming budget, Chicago will be on the hook for over half-a-billion in new pension obligations over the next three years,” Lightfoot said.
Lightfoot vowed a more transparent budget process — with the rare televised speech as her first step. Lightfoot plans to host four budget town halls ahead of her October budget address.
The tough choices Lightfoot mentioned more than once would mark the beginning of the end of a political honeymoon for the freshman mayor who has captured headlines across the country. Lightfoot has said there is “no question” she’ll be forced to raise taxes.
Voicing an increasingly common refrain from newly elected officials, Lightfoot entered the mayor’s office warning that the city’s fiscal situation is even worse than imagined. The previously estimated $700 million budget shortfall figure has ballooned to an expected $1 billion gap — a figure derived from a combination of the structural deficit and debt service, pension payments and yet-to-be-negotiated pay raises for police officers, firefighters and teachers. There’s also a list of wrongful conviction lawsuits to worry about.
And while many had hoped a Chicago casino would help the city reap some cash, there’s a big battle ahead. An Illinois Gaming Board consultant has thus far concluded the taxes the deal calls for are so high that not even a casino located in or near downtown would attract financing.
Lightfoot also faces pressure from the political left on issues including affordable housing, civilian police review, moving to an elected school board, the Chicago Police Department’s error-filled gang database, a community benefits agreement to protect residents living around the planned Obama Presidential Center and raising Chicago’s minimum wage to $15 an hour more quickly than the state.
Lightfoot started out her historic term as the city’s first African-American female mayor by signing an executive order stripping aldermen of their control over licensing and permitting powers in their wards. She has promised to do the same for aldermanic prerogative over zoning, though that would require a Council vote.
The Cindy Pritzker auditorium filled up early with alderman, including Ald. Leslie Hairston (5th), Ald. Matt O’Shea (19th), Ald. Pat Dowell (3rd), Cook County elected officials past and present — including former Clerk David Orr and currentCommissioner Stanley Moore — and civic leaders and others.
Before Lightfoot took the stage Thursday night, protestors gathered outside of the Harold Washington Library demanding the mayor “keep her promises” in regards to funding to address homelessness and opening an investigation into a TIF deal for Lincoln Yards.
”We’re asking for resources — it’s impossible to believe there’s no resources for us,” Estela Diaz said. “We’re asking her to keep her promises.
Ald. Carlos Ramirez-Rosa (35th) said it was “with great disappointment” that he and others watched Lightfoot give the green light to the mega-development.
”Chicagoans voted for change, Chicagoans are tired of business as usual, we are tired of a city where the rich and powerful corporations and connected developers get our money while we are told that we have to pay more,” Ramirez-Rosa said. “As a result of being asked time and time again to pay more we have seen tens of thousands of black working lass Chicagoans pushed out of the city ... we are asking for honesty, we are asking Mayor Lightfoot to keep her promises. Bring in the light, lets do an investigation of Lincoln Yards.”
