2021 Budget

Statement From the Council Floor

First, I want to take a moment to celebrate the achievements of this budget. While it falls short in many ways, please know that some of us listened to movement leaders and our residents to create opportunities for the change we need - especially in this time of crisis. The Progressive, Black and Latino Caucuses came together in an unprecedented way on a number of issues and together fought for increased funding for some of our key priorities. These included violence prevention, removing the Welcoming City Ordinance carve-outs, preserving city jobs, and the creation of a non-law enforcement mental health crisis response pilot. This budget also preserves investments we saw last year in Housing and Mental Health services. Make no mistake, these gains would not have been won without coalition building and a significant push.

But I want to be clear, this budget is not a reflection of what Chicagoans need and deserve. This is not a people’s budget. And the process we followed is not one that faithfully incorporated the input of the people of this city.

I won’t pretend this budget reflects the values that our administration and city council claim to hold. I’m voting aye because that was the price of the non-law enforcement mental health response model being included in the pilot for this year. Movement leaders have led on Treatment not Trauma and I believe this opens a pathway, a necessary pathway, for progress to them.

Many of my residents have expressed disappointment and anger towards this budget. I stand by my decision because I know that I’ll keep fighting for the bigger structural changes we must see but couldn’t achieve this time. But I do feel it’s my duty to share the views of 49th Ward residents, many of whom are outraged to see another budget presented to them that is so out of line with our values and out of sync with our needs.

Madam President, esteemed colleagues - our residents don’t trust us. They hear us say one thing and watch us do another. To paraphrase Shirley Chisholm, we proclaim ideals that are the reverse of our actions. She said that such hypocrisy is the real barrier between us and our youth. And truer words have never been spoken. The answer to civil unrest and protests taking over downtown isn’t more police; it’s divesting from programs and departments that contribute to systems of oppression and investing in services and programs that the science and the data say will better serve our residents. It’s doing everything in our power to create a budget that best serves the residents of our city; especially those residents who have been ignored, discounted, abused and neglected. It’s not simple, but it’s the task to which any elected official in this city who claims to love it, should devote themselves.

Statement Ahead of the Budget Vote

Last week we held budget town halls where I spoke with neighbors about the process to date, the recommendations in the budget presented by the Mayor, the priorities of the Progressive and Black Caucuses, and what I was specifically focusing on for our ward in weighing my decision.

I told our community that I wanted to see more funding for violence prevention programs, a commitment to a non-law enforcement mental health response pilot, no layoffs of city workers and preferred no property tax increases.

On Monday, I'll be voting in support of the amended 2021 budget. Just as I did for the 2020 budget, I have rooted my decision-making process in our community needs and priorities. I made sure those priorities were reflected in the Progressive and Black Caucus demands to amplify our voice and our power.

Working with caucus members, we fought and won a lot in this budget. (For specifics on what we won, see below.) The budget still doesn't have everything that we wanted, or everything we deserve, but rest assured I would not be supporting this budget unless I truly believed that it included significant progress not just for the residents in the 49th Ward, but also Chicago.

Some of you will disagree with my decision, and that's ok. We always need voices pushing for more. In fact, it is a testament to these voices that we got all that we did in this budget as power concedes nothing without a demand. Some of you may disagree, but I ask that you continue to give me space to come to the table and explain why I do what I do. Sometimes even seemingly small gains require compromise in order to move us forward. And make no mistake, fighting for and winning a non-law enforcement mental health program in this pilot is a step forward. As a Black woman, a sister to someone with mental health issues, and the elected representative in a city where Black and brown residents are disproportionately harmed by policing, I feel strongly that we need non-law enforcement mental health response systems now; we can't wait any longer.

Also, the decision I'll make on Monday isn't a referendum on the Mayor for me or just about what's happening in the coming months. I'm always thinking, planning and making decisions based on not just on the immediate impacts, but also on our future. For those of you who have questions about the priorities and why I'm supporting the budget, you'll find a brief on each priority issue below. If you've got questions, please send them to me at office@49thward.org.

Today, as every day, I am working to do the most good for now and in the future. As has been my practice since taking office last year, I will continue to share with you everything that goes into my decision-making.

Telling you what I'm thinking, what I plan to do, and then following through on it is how we build trust and understanding. And advancing progressive policies and agendas is how we build a better city. Together we are stronger, and as always, I am beyond grateful and fortunate to have this incredible community behind me.

2021 Budget Priorities

MENTAL HEALTH CRISIS RESPONSE
The Mayor announced $656,000 for a 2-year pilot mental health crisis response using a co-responder model. The co-responder model involves civilian personnel that are paired with a police officer for responding to mental health calls. This is a model that many cities have used but are moving away from because a non-law enforcement crisis response team has been shown in other cities to be better. I made this my number one issue for moving the administration. We asked for $5M for a non-law enforcement pilot.
Where we were: $656,000 for co-responder only. The Mayor very publicly said she would not consider a non-law enforcement option.
What we won: $1M (with a promise for an additional $1M and potentially more money once federal relief funds are available) and a commitment to include a non-law enforcement model in the pilot. This is a big win. Without the inclusion of the non-law enforcement option, we would have no path forward for the broader crisis response program we want to build in the city. Moreover, we would be stuck with only a co-responder model for at least another year, putting residents in harms way as a result. This was not an option I was willing to accept. This was also the number one issue as expressed by 49th Ward residents, and ultimately, where I committed my support for the budget.

VIOLENCE PREVENTION
Violence, especially gun violence, has plagued our communities and one of the consequences of the COVID pandemic has been an increase in gun violence. Last year, an initial investment of $8M was put towards violence prevention. This year, we asked for $50M.
Where we were: $25M
What we won: An additional $11 million for a total of $36M. We were able to push the administration to include additional funds after revenue projections for cannabis funds came in better than expected.

LAYOFFS AND FURLOUGHS
Our taxes pay for vital city services - that's the whole purpose of government. The importance of our city workers has taken on a new layer of meaning during this pandemic. They have always been essential. I'm happy we're prioritizing their labor and our services in this budget.
Where we were: All non-union staff would take 5 furlough days and 350 workers were going to be laid off.
What we won: Only non-union workers making more than $100,000/year will be subject to the 5 furlough days and there will be NO layoffs.

POLICE SPENDING
Our community has said loud and clear that we believe we need to spend less money on police so that we can redirect those funds to services and other key investments in our people. This budget sees a net decrease of $79,231,916 in corporate funds to the police department, however, this mainly reflects elimination of vacant positions and some consolidation of bureaus within the department. Over 90% of the police budget is personnel, in order to move away from carceral solutions to social issues we're going to need to build the models in crisis response and other services that don't include police so that we can cut the funds from the police department. I believe we need to deliberately divest to invest in different models. This budget doesn't reflect that divest/reinvest change - it's going to be very hard to get. The vast majority of City Council members and the Mayor do not advocate for this work and in many cases stand in direct opposition to it. I will continue to fight for this, not just in budget time, but in every policy and program we implement. The inclusion of a non-law enforcement crisis response model in the pilot is a step in this direction. Without it, we would be two more years away from being able to try a non-law enforcement solution.

PROPERTY TAX INCREASE
I didn't want to see a property tax increase in the budget, but the 2020 revenue loss and projected 2021 revenue losses because of the pandemic left us with few other viable options. Last year, I fought for the inclusion of progressive revenue sources that might have put us in a better position, specifically the Real Estate Transfer Tax (RETT) which require State changes and Payment in Lieu of Taxes (PILOT) which we could have done without Springfield. I also fought for the Fair Tax, which unfortunately did not pass this year. The Mayor did not prioritize these revenue sources and now we're a year later and without the aid they could've provided. The projected revenue wouldn't have necessarily been enough to close the budget gap without property taxes, but it would've made a big difference. I'll continue to work on the progressive revenue issues that can alleviate the property tax burden. Ultimately, the increase won't have a heavy impact on the residents of our ward and given we were able to secure the other investments and save the jobs that would've been cut, I believe this is worthwhile. Below is a graphic that shows how the property tax will impact the residents of the 49th Ward.

49th Ward Budget Town Halls

As budget hearings wrap up and we near the vote for the proposed 2021 budget, we are hosting town halls to hear from you. Join us to learn more about what is included in the 2021 budget proposal. There will also be an opportunity to ask questions and share feedback.

On Tuesday, November 10, at 7 pm, our office will host a town hall for Spanish-speaking 49th Ward residents. On Saturday, November 14, at 10 am, we will host another town hall. While the November 14 town hall will be in English, Spanish translation will still be available for those unable to attend the November 10 meeting.

To review the budget forecast, the Mayor's proposal, and 49th Ward survey results, scroll down on this page. To register to attend a budget town hall, visit bit.ly/townhall2021budget.

Initial Reaction

$94M Property Tax Increase - The Mayor has depicted the tax increase as a modest way for every Chicagoan to pitch in to help close the deficit. While the average yearly cost to someone with a home valued at $250,000 is only $56/year, I’m concerned about increasing ANY costs to residents during a time when property owners and renters alike have been hit hard economically. In our Ward, 70% of our community rents, which means our average owner has a higher value property which in turn will mean higher cost in the tax increase. This is a cost that will likely be passed on to renters, both residential and commercial.

Gas Tax Increase - Again, this is a minor increase, but I have concerns about our city relying so heavily on regressive taxes that hit working people and low income individuals harder than others. This proposed tax increase only projects about $15M in new revenue, I’m hopeful we can make that up elsewhere.

Personnel Cuts - The Mayor’s budget recommends furloughs, layoffs, and the elimination of about 1,000 vacant positions to save us $106M. The 5 furlough (unpaid time off) days will be for every non-union employee. This includes myself, the Mayor, ward staff and our Ward Superintendent. The layoffs are estimated to impact 350 employees, though it’s not clear yet which positions they will be. The vacancy eliminations span nearly every department and about 600 of the positions being removed are from the police department, though many appear to be civilian positions. Last year we saw about 3,000 vacancies left in the budget. I’d like to see whether we can go a little leaner in order to reduce the layoffs being proposed.

Police Budget - While there are cuts to the police department budget due to the vacancy reductions, the Mayor made it clear that she does not believe in defunding any core functions of the police department. The police budget draws a large percentage of our funds (roughly 40%) and it’s clear that many of the problems we’re facing in our neighborhoods are issues that police cannot fix or change. Police are not social workers, they’re not counselors or mental health professionals, and as a city the overuse of this department and lack of oversight for decades continues to cost us hundreds of millions of dollars in the consent decree and lawsuits. We’ve got to do something different to address public safety in our city. I’ll be fighting to bring a non-law enforcement mental health crisis intervention response model to our city and to allocate more funds for domestic violence and violence prevention programs which will better serve our residents and allow the police to focus on the tasks we count on them to do.

Stay tuned to our website, the newsletter and the social accounts for upcoming budget town halls as our team works to keep you informed and keep me accountable to you as alternatives are being considered in advance of the budget vote.

Mayor Lightfoot's Budget Proposal

On Wednesday, October 21, Mayor Lori Lightfoot gave her 2021 Budget Address. In it, she described the unique challenges 2020 has presented our city and our communities. COVID-19 has had dire consequences on the city's finances.

The abrupt halt of economic activity has left the city with an $800 million budget shortfall for 2020. The 2021 budget forecast expects similar challenges we faced in 2020, with an estimated $1.2 billion budget gap. Of that projected budget gap, 65% is contributed to the economic fallout of COVID-19.

During her address, Mayor Lightfoot outlined her path towards filling the shortfall and creating a balanced budget for 2021. This year, City Council is faced with difficult decisions as we enter the budget season.

You can watch a recording of the address here. A full copy of the 2021 Budget overview is available here, and a full copy of the 2021 recommendations is available here. Beginning Monday, October 26, daily budget hearings from each of the City departments will commence. Visit the City Clerk's website for the schedule and to stream the hearings.

The Office of Community Engagement is hosting two 2021 Virtual Budget Town Halls, the first on Tuesday, October 27, at 5:30 pm, and the second on Thursday, October 29, at 5:30 pm. Both will be streamed on the Mayor's Facebook page. Spanish language translation and ASL interpreters will be available for both events.

Savings & Efficiencies:

The 2021 budget proposal projects $262.6 million in savings through a series of improvements to fiscal management. This includes introducing more parking meters throughout the city, which will reduce the amount the city has to pay out to LAZ each year. The proposal also intends to increase the enforcement of certain fees, manage accounts receivables more efficiently, and the loss of collection savings.

The proposal also projects $168.3 million in savings and efficiencies that do not include city personnel changes. This consists of a new, renegotiated health care contract for city employees and an audit and review of the city's contracts. The city will scrutinize all of its contracts to see where new bids can be issued, especially for contracts that date back nearly three decades.

The 2021 budget also includes changes to city personnel, with 350 layoffs and a requirement of 5 unpaid furlough days for non-union employees. It also calls for eliminating 1,800 vacancies across all departments, including 614 in the police department. The Mayor did indicate that should federal relief come through before layoffs go into effect (March 1, 2021), this component of the budget proposal will be reconsidered.

Again, the city will contribute the TIF surplus to the 2021 budget to help fill the gap, which is projected at $33.5 million. Additionally, the Office of Budget Management is refinancing and restructuring the city's debt. This will help the city save $501 million.

Finally, the Mayor did indicate that pension reform continues to be an option that the city will explore as an opportunity for improved fiscal efficiency.

New Revenue:

The 2021 budget proposal does call for an increase in property taxes. This increase is projected to bring in an additional $93.4 million. It is estimated that the increase will result in an additional $56 per year in property taxes for a home assessed at $250,000.

Mayor Lightfoot renewed her call on Springfield to give Chicago its fair share of the Local Government Distributive Fund (LGDF). Chicago remains an economic engine for the state, so it is only fitting that we receive a commensurate amount from the LGDF, to which we do contribute.

Finally, the Mayor stated that the 2021 budget proposal includes $184.9 million in new revenues and draws from the city's reserves. The withdrawal from the rainy day fund is modest, totaling $30 million. While we know that 2020 has felt like a torrential downpour, the city risks further deteriorating its credit score should that figure be higher. Moreover, we continue to combat COVID-19 and continue to face many unknowns at the federal level. It's imperative that the city remain prudent and maintain these reserves.

New Investments:

The 2021 budget proposal does include a variety of new investments and expenditures aimed to address some of the challenges our communities now face as a result of the pandemic. The 2021 budget includes $7 million to establish an economic recovery task force designed to help our communities most impacted by COVID-19 fully recover.

The Mayor's office will continue its youth programming and is proposing an additional $1.7 million investment to support these programs in 2021.

The Mayor indicated that the 2021 budget will include funding for violence prevention and mental health. This will consist of strengthening the coordination between street outreach workers and our mental health partners. The budget will also include investments to reduce domestic violence and provide victims of violence with resources.

The Mayor announced that in 2021 the city will launch a co-responder pilot to begin the process of establishing the framework for an alternative response model. This pilot program would provide residents experiencing crises that are not violent in nature an alternative response to police intervention.

Finally, the budget calls for a $10 million investment in funding for housing and homelessness prevention. In addition to the $10 million investment from the city, Chicago will receive an additional $52 million in CARES Act funding in 2021 to go towards housing assistance and homelessness.

Next Steps:

The city was already up against a challenging budget season before COVID-19. These challenges result from previous administrations' decisions and rubber stamp City Councils; decisions including pension holidays and the city's parking meter deal with LAZ. The COVID-19 pandemic has only exacerbated the city's financial struggles.

Overwhelmingly, our office has heard from you that it is time to address the issue of public safety proactively and holistically. That looks like investments in our communities in the form of stable and affordable housing, access to resources, and economic opportunities. This is why I co-sponsored an order that was introduced to the City Council in September that calls for a Chicago Crisis Response and Care System housed within the Department of Public Health. This team would be designed after the CAHOOTS model in Eugene, OR. While I am glad to see the Mayor address the need for an alternative response for mental health crises, I worry about the co-responder model and, instead, call on her to work with my colleagues in the Chicago Progressive Reform Caucus on the legislation that has already been introduced.

So many of us have had to make tremendous sacrifices this year. Which is why I'll be scrutinizing the budget and asking hard questions during hearings. We can't keep balancing our budget on the backs of the working class.

49th Ward Budget Survey Results

As we enter the city's planning sessions for the 2021 municipal budget, we asked 49th Ward residents to complete a budget survey.

The 49th Ward office also hosted two town halls to go over the city's budgeting process, the survey results, and hear feedback before we enter budget hearings. The feedback you provide our office will help the Alderwoman advocate for the budget priorities of our residents.

Overwhelmingly, we've heard that we need to take a good look at the police budget to see if there are opportunities to divert funding from that portion of the budget to more holistically address the issue of public safety in our communities. This means that we look towards investing in our neighbors through stable affordable housing, equitable access to resources and opportunities, and alternative crisis intervention responses for non-violent emergencies (e.g., mental health crises).

Our office has been working closely with Alderwoman Rodriguez-Sanchez and others in the Chicago Progressive Reform Caucus on developing an alternative crisis response team. In September, we co-sponsored an order that called on departments to explore the costs of this and to begin to develop the framework for such a response based on the CAHOOTS model in Eugene, OR. Our office remains committed to making sure that we address public safety issues in a way that is proactive in caring for our residents.

Thank you to everyone who participated. We will make sure to keep you apprised as budget hearings begin, and the Mayor introduces her budget proposal.

View Survey Results

49th Ward Budget Survey & Town Halls

The city is heading into its budgeting season, and we want to hear from you! Please take a moment to complete the 49th Ward budget survey online (en español aquí) to help us identify the priorities of 49th Ward residents. Your responses will help inform Alderwoman Hadden we enter discussions for next year's budget.

Our office will share the results of this survey after it closes on October 4 in our newsletter, on our social media pages, on our website, and at two 49th Ward budget town halls.

Save the dates! We will host two 49th Ward budget town halls where we will discuss the city's process in forming its annual budget, the challenges we face this year, and the results of this survey. Residents will also have the opportunity to ask questions and provide feedback as we enter the budget season.

First Town Hall: Saturday, October 10, at 10 am
Second Town Hall: Thursday, October 15, at 6 pm

Register to attend a Town Hall online at bit.ly/townhall2021budget (Spanish translation available).

Do you know someone in the 49th Ward who should complete this survey? Please share the link (bit.ly/2021budgetsurvey) with them!

2021 Budget Forecast

On August 31, Mayor Lightfoot and Budget Director Susie Park released their 2021 Budget Forecast. The reality we're facing is stark, with the toll of COVID-19 having a compounding effect on the city's finances.

In fiscal year 2020, the City is facing a budget shortfall of approximately $800. The shortfall is a direct cause of the ongoing COVID-19 crisis and the economic fallout Chicago - and other municipalities across the country - is continuing to experience.

The crisis of COVID-19 and the absolute necessity for the city to respond to curtail the spread of the virus is a direct cause of this year's budget shortfall. The need for people to stay at home and socially distance reduced the city's economic activity. This is especially true for the city's tourism and hospitality industries. Restaurants were forced to close, major conventions were canceled, festivals and concerts had to cancel, and our hotel industry took a significant hit. As a result, the city's Gross Domestic Product has fallen 10%, the city's unemployment has reached 18.7% (up from 3.6% in February), and consumer spending has fallen 12%.

To fill the $800 million budget gap, the Budget Office is looking to leverage $350 million in CARES Act monies. This money can only be spent on city services in response to the COVID-19 crisis and cannot go to replace lost revenue from the economic fallout of sheltering in place. The Budget Office is also refinancing debt, which will go towards closing the 2020 budget shortfall.

Finally, the Budget Office is a part of a coalition of municipalities across the country that is calling on our Federal legislators to provide supplemental funding to fill revenue gaps, extend unemployment benefits, provide funding for infrastructure, and provide additional affordable housing assistance.

If additional federal monies are not allocated to municipalities and states across the country, the city might be forced to look at spending and services efficiencies (i.e., furloughs, layoffs, and cuts).

During the address on Monday, Mayor Lightfoot also shared the 2021 Budget Forecast. The forecast is equally as stark as the 2020 figures, with the city facing a $1.2 billion budget gap.

The 2021 Budget Forecast anticipates an increase of $421 million by the city and a decrease of $783 million in revenue. The decrease in revenue is, again, a direct cause of COVID-19 and, at this time, only a projection. This figure makes up 65% of the projected budget gap for 2021, once again exemplifying the devastating impact the COVID-19 crisis has not only had on public health but the economy.

Additionally, new costs are planned for 2021. Primarily, the city's mandated pension increase in the pension payment by almost $100 million and contractual pay increases contribute to the 2021 budget gap.

To address the projected 2021 budget gap, the Budget Office is looking for tax valuations, including large TIF surpluses. The city is also exploring the non-possessory lease tax for computers as a potential revenue stream. Additionally, the Mayor called on Springfield to provide Chicago with its fair share of the Local Government Distributive Fund (LGDF).

The Mayor's Office indicated that they've been working closely with Springfield on ushering in a casino and entertainment district to the city. A final location for the entertainment district has not yet been determined, but the city has issued a Request for Information to help inform any final plan.

Finally, the Mayor and the Budget Office are evaluating the city's contracts to see if there are any cost-saving measures that can be implemented. An increase in property taxes and furloughs are at the end of the list of tools the city is exploring to address the 2021 budget gap.

As budget hearings commence, our office will share more information about budget proposals and ways our community can engage around the 2021 budget process.

Ward Service Office

1447 W. Morse Ave

Chicago, IL 60626

office@49thward.org