Mayor Brandon Johnson will propose a property tax hike when he lays out his budget plan to City Council Wednesday, sources say.
Mayor Johnson did promise not to raise property taxes during his campaign. The city has been under a hiring freeze to address the nearly$1 billion budget shortfall.
The proposal is already meeting with pushback from some city council members. Homeowners in Chicago, already dealing with higher property taxes because of the new reassessments coming out, will now have to brace for more.
"The 43rd ward, gets a big brunt of the property tax and creates a lot of revenue. There's no question. And I don't think, I think I speak to my constituents when I say, I'm not comfortable with the property tax increase if I don't also see balance," said Ald. Timmy Knudson. "We need to create revenue in different ways. We need to make cuts where there's cuts to be had and right size some of the departments."
According to City Hall sources, the mayor has briefed some aldermen that in his budget address, he will be proposing a property tax hike as a way to bridge the gap.
Mayor Johnson to propose property tax hike, sources say
During an interview with ABC7's Mark Rivera earlier this month, Mayor Johnson suggested property tax hikes could be needed.
"I don't want cuts, I don't want layoffs," Mayor Johnson said. "I saved the taxpayers over $200 million in last year's budget. But the harsh reality is this: our expenses have outpaced our revenue."
A fiscal watchdog group says the city can avoid a property tax increase by cutting costs by raising revenue.
"This is a highly political decision that signals that the hard work that needed to be done, has not been done," said Civic Federation President Joe Ferguson.
The Civic Federation recommends increasing the city's liquor tax, implementing a one-percent tax on groceries, adding video gaming or hiking the fee for garbage collection to close the deficit.
The city council's progressive caucus is calling for no city worker layoffs, and the tax hike may be a way for the mayor to avoid angering labor interests.
"Everything should be on the table," Alderman David Moore said. "But you also have to look at, are we as thin as we need to be first of all, because you can lay people off and then you are not providing the proper services that you need."
Published reports indicate the city has hired or promoted 490 people since a hiring freeze went into effect in September.
But the president of the Civic Federation said that's problematic given the city's financial crisis.
"It is wrong not to ask labor to be a partner in the shared sacrifice that's going to be necessary," Ferguson said.
A city ordinance allows for an automatic property tax increase tied to inflation, but capped at 5%. Some aldermen say the mayor's decision last year to skip that was a mistake.
"Yes, it is a bad idea, because with that, if he would have kept that component in, we wouldn't be in the mess we're in right now," said 13th Ward Ald. Felix Cardona.
But given the current budget deficit, the city council and the mayor have their backs to the wall, and not many great options.
ABC7 Political Analyst Laura Washington said the budget crisis has created a perfect financial storm.
"I think some of the aldermen are concerned about those kinds of fees because they are regressive and they are going to attack lower income families more than upper income families and they don't want to see more burden put there, so those kinds of taxes and fees I would think Johnson would want to shy away from," Washington said.
The mayor is expected to make his budget address to the City Council Wednesday morning.
The mayor's budget address will be followed by two weeks of budget hearings. They are scheduled to begin on November 6.
By law, a budget must be passed by December 31.