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 Emanuel laid out a 2016 budget plan filled with tax hikes and
budget cuts on Tuesday in an attempt to fix a financial crisis
linked to the city's unfunded pensions. The mayor is looking to the
Democrat-controlled legislature to approve his plan that would allow
residents with homes worth less than $250,000 to avoid a higher tax.
The Chicago mayor is also hoping Illinois' Republican Governor Bruce
Rauner will approve a lower pension payment schedule for the city's
public safety worker retirement systems in an effort to save $247
million next year.
But neither item seems likely to be approved any time soon.
Rauner has shown no signs that he is willing to back the mayor’s
priorities. And the top Republican in the Illinois House voiced
scepticism about the mayor’s wish list.
"The mayor knows full well the environment is a lot different here
than it’s been in a long time. Everything that’s seemingly easy or
makes sense can get caught up in this environment," said House
Republican Leader Jim Durkin, who represents a swatch of Chicago’s
western suburbs. "It’s not going to be easy."
 According to the Cook County Clerk’s office, the city has until Dec.
29 to put the first phase of the mayor’s tax hike on property tax
bills.
Legislation that must take effect immediately requires a
three-fifths vote for passage before the end of the year, and the
state House’s Democratic super majority has proven to be porous.
The second-term mayor has been working with Democrats behind the
scenes to draft a plan to shield middle- and lower-income Chicago
homeowners from any potential property tax hike. A House hearing
dealing with the property tax exemption is scheduled for Thursday.
But any plan likely will run into resistance from Republicans, as
well as Democrats, who do not like changes that benefit only
Chicago.
“If it’s Chicago only, the roll call becomes exceptionally
difficult,” said State Representative Michael Zalewski, a Democrat
from southwest-suburban Chicago, who is vice-chairman of the House
panel expected to discuss the property-tax plan.
Chicago faces a $745 million budget shortfall, driven largely by
increasing pension costs. In his budget address on Tuesday, the
mayor called for a massive property tax hike, a first-ever fee on
residential garbage collection, new surcharges on ride-sharing and
cab companies and a tax on e-tobacco products.
Chicago homeowners currently get a break on their tax bills that
shields $7,000 of their property’s assessed valuation from taxation.
Emanuel has not said how much that would rise under his plan, or if
any relief would be expanded statewide.
Efforts to tinker with the state’s complicated property tax laws
could ignite dissension from some Democrats, who have been pressing
to overhaul the state’s school funding formula.
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Andy Manar, an Illinois state senator who represents a mostly rural
region, said any discussion about changing property tax laws must
include school funding reforms. The two issues are “absolutely
related, and they absolutely have to be part of the same
conversation,” said Manar, a Democrat.
Chicago Alderman Scott Waguespack, a member of the city council’s
small but vocal Progressive Caucus, acknowledged that Emanuel likely
has the votes to win approval for his budget, but a political
stalemate over state finances could eliminate the political cover
Emanuel has sought for an expanded property tax exemption.
"I just can't see how he (Rahm) can stand here without giving the
aldermen specifics on how he's going to accomplish that," Waguespack
said on Tuesday, following the mayor’s budget address.
Rauner’s silence on the issue further complicates Emanuel’s effort.
Earlier this month, Rauner’s office linked any changes to state
property tax laws with the governor’s demand for business-friendly
reforms to state workers compensation, prevailing wage and
collective-bargaining laws.
A Rauner spokeswoman declined comment Wednesday on Emanuel’s budget
or the mayor’s push for the bigger tax exemption.
Another initiative Emanuel sorely needs is pension-relief
legislation that has passed both the House and Senate. Rauner has
threatened to veto the bill, so legislative leaders have held it in
place through a parliamentary maneuver to keep it from reaching the
governor’s desk.
The pension measure would lower the city’s outlay to its underfunded
police and fire pensions by $247 million in 2016 – and by $990
million through 2020 -- while giving the city an additional 15 years
for the pension systems to reach a 90-percent funding level.
(Reporting By Dave McKinney, additional reporting by Karen Pierog
and Karl Plume in Chicago; Editing by Diane Craft)
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