Chicago is in the midst of a $30 billion pension crisis for police and firemen that Mayor Rahm Emanuel inherited from his predecessor, Richard Daley. The crisis has reached a tipping point, which has forced Emanuel to come up with a slew of new taxes, including a whopping $588 million dollar property tax increase.
But that's just a beginning. "Boot fees" on illegally parked cars are going up, as are fines for failure to remove snow. And most controversial of all - a first ever garbage collection fee that could be a precursor to privatizing garbage collection.
For the city's elected alderman, all of this is proving to be hard to swallow. These aren't taxes on fee increases on the rich. The tax increases will affect every homeowner, every business, and every citizen in the city.
Chicago Sun Times:
On Monday, the Budget Committee will take up the mayor’s $7.8 billion budget — with 431 more “full-time-equivalent employees” even after 73 jobs are eliminated by privatizing Chicago’s 311 non-emergency system.
The Budget Committee will also vote on a catch-all management ordinance that includes a 66 percent increase in Chicago booting fees and a five-fold increase in the maximum penalty imposed against property owners who fail to remove snow and ice from the sidewalks abutting their building.
On Tuesday, the Finance Committee will take up the mayor’s $712 million revenue package.
To confront Chicago’s $30 billion pension crisis and eliminate the structural deficit he inherited, Emanuel’s lower-the-boom menu includes a four-year, $588 million property tax increase for police and fire pensions and school construction; a $9.50-a-month garbage collection fee to raise $62 million; $13 million in higher fees for building permits; a $1 million tax on e-cigarettes, and $48 million in fees and surcharges on taxicabs and ride-sharing services that have siphoned business away from them.
If any of the votes are going to be close, it’s the one for the garbage fee and Emanuel understands why.
It’s a new fee for a service many homeowners believe “is kind of baked in” to the normal property tax bill that would add $114 to the annual cost heaped on 613,000 Chicago owners of single-family homes, two-, three- and four-flats that still get city pickups. Senior citizens would get a 50 percent discount.
Ald. Howard Brookins (21st), former chairman of the City Council’s Black Caucus, is so dead set against the idea, he wants the mayor to cancel the garbage fee and raise the property tax even higher to make up for the lost revenue.
“The average property tax increase is $110. The average garbage fee is $120. If you have a two-flat, it’s $240. It’s a hard sell for our residents,” Brookins said.
“I would prefer the city fund basic operations out of the property tax, which is a more reliable tax going forward, and get away from fines and fees or come up with some other ideas.”
Chicago is already one of the highest taxed cities in the nation and this rash of revenue raisers will only increase the flight from tie city to the suburbs. Businesses have been hit with sales tax increases, hospitality and entertainment fee increases, and passengers at O'Hare airport have been socked with an increase in fees as well.
There is no end to tax increases as long as the city refuses to put its budget in order. There has been little attempt to cut the over bloated budget, largely because Emanuel has to deal with powerful aldermen who have packed city departments for generations with cronies and the children of cronies to feather their own nests. Cutting those departments means cutting patronage jobs - the political lifeblood of the politicians.
The more than $700 million in tax increases is a band aid. It will kick the can down the road a few years - until the next crisis arises. Then, lacking the will to cut the budget or the imagination to avoid a tax increases, the same "solution" to the problem will be applied and the viscious cycle will continue.
Emanuel's rubber stamp city council will probably approve most of the tax increases. But their hesitancy is instructive. The city government is at a crossroads and the unease of alderman reflects the growing anger of the voter whose patience is being sorely tested with the mayor's tax plan.