The money the city requested in the letter sent Thursday is separate from the $10,000 bond that Smollett forfeited as a condition of the charges against him being dropped.
Read the city's full letter to Smollett's team here
"This is a reasonable and legally justifiable amount to collect to help offset the cost of the investigation," said Bill McCaffrey, of the city's Department of Law.
"Given that he doesn't feel any sense of contrition and remorse, my recommendation is that when he writes the check, in the memo section, he can put the words, 'I'm accountable for the hoax,'" Mayor Rahm Emanuel said earlier Thursday.
WATCH: Emanuel speaks on what he believes Smollett owes Chicago
Emanuel said he believes Smollett not only cost the city financially, but also damaged Chicago's reputation of being a place that welcomes people of all walks of life.
Smollett's legal team fired back at Emanuel's comments Thursday afternoon, issuing this statement:
"It is the Mayor and the Police Chief who owe Jussie - owe him an apology - for dragging an innocent man's character through the mud. Jussie has paid enough."
Emanuel on Smollett: 'This is making fools of all of us'
Smollett attorney: 'He was a victim of a crime'
Smollett had been charged with 16 counts of felony disorderly conduct for allegedly lying to police about a January attack in Chicago's Streeterville neighborhood, which police say Smollett staged on himself because he was unhappy with his "Empire" salary. All charges against him were dropped Tuesday in exchange for community service and forfeiture of his $10,000 bond payment.
What exactly happened in court just before the charges were dropped remains unknown as all records pertaining to the case have been sealed.
An attorney collectively representing various media outlets went to court Thursday to ensure that the files be preserved. She was assured by the judge that the records would be preserved while under seal, and that the state's attorney's office would notify her if Smollett's team petitioned to expunge Smollett's record.
Smollett is not currently seeking to have the records expunged, his attorneys confirmed. If they did, it would likely take about seven to eight months before a hearing is held.
"We support the court files being preserved. We have not and will not file a motion for destruction of any records in this case," Patricia Brown Holmes, one of Smollett's attorneys, said in a statement released Thursday.
President Donald Trump also weighed in Thursday morning, tweeting that the FBI and U.S. Department of Justice are looking into the Smollett case.
"FBI & DOJ to review the outrageous Jussie Smollett case in Chicago. It is an embarrassment to our Nation!" Trump tweeted.
FBI & DOJ to review the outrageous Jussie Smollett case in Chicago. It is an embarrassment to our Nation!— Donald J. Trump (@realDonaldTrump) March 28, 2019
WATCH: Kim Foxx defends office's decision in Jussie Smollett case
ABC7 Eyewitness News sat down Wednesday with Cook County State's Attorney Kim Foxx, who defended her office's decision to drop all charges.
Foxx said that the practice of dropping charges in exchange for community service and restitution is not uncommon for the Class 4 felonies that Smollett was charged with.
RELATED: I-TEAM: What's inside CPD's Jussie Smollett investigative file?
Even as Foxx said Smollett received no special treatment, officials in her office were circulating a memo, which has been confirmed by the I-Team, asking Cook County prosecutors for examples of cases like where charges were dropped under circumstances similar to Smollett's.
"Nobody is in trouble, we are just looking for further examples," the email read, in part.
Foxx said the dropped charges do not mean Smollett was exonerated. She said based on the facts and the evidence that were presented in the charging decision, her office believed that they could prove Smollett guilty.
"We do this every day," Foxx said. "This is consistent in what we do in alternative prosecution."
The Illinois Prosecutors Bar Association issued a statement Thursday disagreeing with Foxx's characterization of the situation.
"The manner in which this case was dismissed was abnormal and unfamiliar to those who practice law in criminal courthouses across the State," the statement read, in part. "Prosecutors, defense attorneys, and judges alike do not recognize the arrangement Mr. Smollett received. Even more problematic, the State's Attorney and her representatives have fundamentally misled the public on the law and circumstances surrounding the dismissal."
Federal authorities, including the FBI, are also looking into the circumstances surrounding the dismissal of charges, two law enforcement officials confirmed Wednesday.
A spokesperson for the FBI's Chicago office declined to comment.
Meanwhile, Smollett jetted off to Los Angeles ahead of the NAACP Image Awards on Saturday, where he is nominated for Outstanding Supporting Actor in a Drama Series.
Jussie Smollett update: What's inside the CPD investigative file?
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