In preparation for the Chicago City Council’s vote on the proposed 2018 budget today, the Committee on Finance passed two ordinances last week, one which puts in place a property tax increase that was approved in 2015, and another which implements a series of new taxes, fee and fines meant to balance the City’s 2018 budget.
The new property tax levy is part of a four-year phased-in increase, introduced in 2015 to create revenue for police and fire pension funds. The proposed 2018 levy is $1.4 billion and will dedicate $900.2 million to the pension funds, $414.9 million to debt services and $95.4 million to the Chicago Public Library system.
The committee approved this measure without much discussion. However, the second ordinance received more attention. This ordinance packages eight new taxes, fees and fines into one piece of legislation. Because all the tax and fee increases were bundled together, aldermen who wanted to vote against a certain tax were forced to sustain from voting, because a vote against one was a vote against all.
One of these taxes, which received the most debate, imposes $0.55 per ride on all ride-share companies and increases to $0.60 in 2019. The tax also puts a $5.55 fee on “special trips” to O’Hare, Midway, Navy Pier or McCormick Place.
The tax is expected to generate $16 million, which will go directly to Chicago’s Transportation Authority for capital projects such as improving security cameras and station lighting.
Alderman Brendan Reilly (42nd Ward), along with other aldermen, expressed concerns in providing a “perpetual funding source” to CTA, an independent agency that does not answer to City Council. Although CTA will provide an annual report, Council will not have purview over the $16 million once it’s allocated.
Also included in the ordinance is an increase in the monthly 911 surcharge from $3.90 to $5.00 per line on both wireless and landline phones. The funds from this tax hike will implement an improved 911 dispatch system or go to other state-authorized expenses.
This tax received backlash from many aldermen as an unnecessary financial burden on struggling constituents.
Aldermen George Cardenas (12th Ward) and Reilly, both against the 911 surcharge, sought to vote against its passage. However, both aldermen were told that a no vote on the surcharge would result in their no vote for the entire ordinance.
The ordinance also included an amended amusement tax that eliminates the tax on venues with a capacity of 1,500 or less while raising the fees on bigger venues. The ordinance also increases fines for environmental and building code violations.
While grouping these new taxes into one ordinance ensures quick passage, it also ensures that aldermen are unable to vote for the taxes they support while voting against those they do not. Cardenas and Reilly sustained from the vote, and the committee ultimately approved the ordinance.
Also, Alderman Reilly and Alderman Scott Waguespack (32nd Ward) introduced an ordinance that would have stopped money from the these tax hikes from going towards CTA and CPS. However it wasn’t on the agenda during the November 20 Finance Committee meeting because the Committee Chair Alderman Ed Burke (14th Ward) said the committee didn’t receive the bill in time. The dispute over whether the bill should have been on the agenda or not led many alderman to question whether it was kept off out of political reasons. Alderman Leslie Hairston (5th Ward) said, “These types of shenanigans that go on, again, how convenient it is to lose something that should be debated by council, that does deal with taxpayer dollars that are going to other sources, is very suspect.”
The budget is expected to pass a City Council vote today.