Days after Lightfoot delivered a budget address in which she called for hardly any property tax increase in a package that tries to close an $838 million hole, city Chief Financial Officer Jennie Huang Bennett and Budget Director Susie Park kicked off hearings on the plan in front of aldermen who wondered whether that prognosis was too good to be true.
Lightfoot is counting on $50 million in 2020 via a graduated real estate transfer tax that charges more for more expensive property sales, a change she wants state lawmakers to approve this fall in their veto session. The mayor also wants legislators to rework the tax structure for the Chicago casino license, though no gambling revenue is counted on next year.
“This week we’re heading into veto session,” West Side Ald. Emma Mitts, 37th, said. “And if you can tell me, if we don’t get that $50 million, where are we going to look to get those dollars from? Do you have any idea?”
Park said they feel good about their chances. “We continue to have productive conversations with our partners in Springfield, with various legislative leaders as well as the governor’s office,” Park said. “And we feel optimistic about our ability to secure those new revenue sources for our budget and the out years.”
North Side Ald. James Cappleman, 46th, later pressed more explicitly on whether more property taxes might be in the offing given the questions that remain in the budget plan.
“The mayor indicated during her address that she didn’t fill the budget deficit with a large property tax increase, that she wasn’t going to do that. But the understanding is she’s going to Springfield to secure some legislation to hopefully avoid a property tax increase. Should a property tax increase be necessary, what’s the outside amount that taxpayers could expect if those efforts in Springfield fail?”
Park hewed to the hope for success downstate, while acknowledging they might have to turn to property taxes if things don’t work out in the Capitol. Those estimates extend beyond 2020 as the administration counts on casino revenue and real estate transfer tax money in succeeding years, she said.
“Like I said, we’re having productive conversations. To the extent that we’re not able to secure a revised tax structure on the casino or the real estate transfer, we haven’t taken any options off the table for the out years," Park said. "We’re going to continue to work to the best extent we can, as we have in the 2020 budget, in order to try to avoid property taxes, but we can’t take any options off the table at this point.”
And Ald. Raymond Lopez, 15th, a frequent mayoral critic, hit the administration for relying on various uncertain revenue streams, among them $163 million in additional reimbursements that the city has requested from the state for the cost of ambulance runs by the Chicago Fire Department. Gov. J.B. Pritzker’s administration has said federal officials still haven’t approved that payment for Medicare and Medicaid services. “This budget should give us all pause,” Lopez said.
City Comptroller Reshma Soni said the city is “confident that amount will come through” on the ambulance costs. “We’re going through the administrative process with them, finalizing everything so we can start getting the reimbursements,” Soni said. “We hope to start getting those reimbursements as early as later this quarter, 2019.”
Officials also put a finer point on Lightfoot’s plan to hike downtown parking meter rates. Rates at meters downtown and in the West Loop would go up 50 cents an hour next year, Park said. In addition, meter rates across the city would go up in future years at a rate tied to inflation, she said. The city is counting on about $7 million in 2020 from the higher parking rates.
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