After Property Tax Increase Eliminated, Mayor’s Budget Passes City Council

City Council passed the Mayor’s revised $17.1B budget on Monday, December 16. The budget excluded the originally proposed $300 million property tax increase. After City Council unanimously rejected the initial proposal, the Mayor scaled back the tax hike, presenting additional budgets that included a $150M and later a $68.5M property tax increase. Both budgets were also rejected, as many City Council members called on the Mayor to implement more cuts and efficiencies.

The Mayor ultimately presented a budget with no property tax increase. The gap was filled by applying $40M in proceeds from a bond refinancing that generated more than expected; cutting positions in the Mayor’s Office and middle management positions in various city departments; renegotiating some city contracts (estimated at $8.6M), and energy savings (estimated at $5M).

The budget also includes higher taxes on parking (increasing the City tax to 23.35% from 22% on weekdays and 20% on weekends), cloud computing (increasing the tax from 9 to 11%), streaming services (increasing the entertainment tax from 9% to 10.25%), rideshares (extending the City’s downtown rideshare surcharge to weekend trips and expanding the downtown border), and retail bags (increasing the bag fee from 7 to 10 cents).

BOMA/Chicago worked closely with City Council members during the budget process to advocate against a property tax increase and emphasize the need for fiscal efficiencies while minimizing the impact of tax increases.

“The City Council’s rejection of the Mayor’s property tax increase is an encouraging step, but this protracted process was avoidable and will repeat next Fall if we do not develop holistic solutions in the coming months,” said Farzin Parang, BOMA/Chicago Executive Director. “We need policies that drive economic growth, without which we cannot expand our tax base, create high-wage jobs, revitalize our downtown, or invest in the city. It is time for the Mayor to convene Chicago’s business organizations to forge this plan in real partnership.”