With casino fix uncertain and real estate transfer tax all but dead, mayor likens attempts to pass her ambitious legislative agenda to “going through the eye of a needle” and said she is “trying to thread that as best we can.”
With the clock running out on the fall veto session, Mayor Lori Lightfoot on Thursday likened attempts to pass her ambitious legislative agenda to “going through the eye of a needle.”
Lightfoot tried to tamp down expectations for her two major priorities: a revised tax structure for a Chicago casino and a graduated real estate transfer tax.
“We continue to work hard, particularly in the House because the [casino] bill has got to originate in the House. … We’ve been working hard, really literally all night to make sure we can get something to the floor of the House today, then move it over to the Senate,” the mayor said.
“But you know this as well as I do: In a veto session, it’s a narrow window of time and, realistically, we’ve had a day-and-a-half of work this week. It’s like going through the eye of a needle and we’re trying to thread that as best we can.”
The mayor seemed prepared to give up the ghost on the graduated real estate transfer tax she was counting on to generate $50 million in 2020.
“If we end up not putting it on the floor [Thursday], we’ll put it back up in the spring session. And we created a `Plan B’ in our budget to account for that not being a possibility,” she said.
Earlier this week, top mayoral aides briefed aldermen on that “Plan B.”
It would fill the $50 million gap created by a stalled real estate transfer tax without any additional tax increase by:
• Claiming an additional $15 million in savings up-front—instead of just $200 million--by refinancing $1.3 billion in city debt.
• Saving an additional $20 million by slowing hiring to rates assumed in 2019 instead of speeding it up.
• Shaving an additional $6 million from the city’s $400 million in annual health care costs.
• Reducing the budget increase for the mayor’s office — from $3.8 million to $2.5 million.
Aldermen were also told the city’s property tax levy will rise by roughly $65 million — not just the previously-announced $18 million needed to open Chicago Public libraries on Sundays.
Of that amount, $32 million is tied to “debt service” needed to retire a general obligation bond issue approved by the City Council last spring. Another $15 million comes from capturing the growth from new construction.
Earlier this week, Lightfoot argue there was no bait-and-switch, and aldermen knew they were voting for a $32 million property tax increase when they approved the borrowing last spring. That’s even though Ald. Ray Lopez (15th), her most outspoken City Council critic, claimed otherwise.
“Ray Lopez apparently forgot that he voted for a property tax increase earlier this year that was proposed by former Mayor Emanuel. So, he got it 100 percent wrong” by accusing Lightfoot of raising property taxes higher than she said she would, the mayor said.
“There’s nothing new regarding property taxes beyond a modest increase in the library levy that we proposed back on October 23. That was wrong but, unfortunately, some people picked it up and ran with it.”
What the mayor didn’t say is the fact that, while general obligation bonds backed by property taxes are automatically tied to a tax hike, the city has routinely abated those increases.
