Budget hearings are underway at City Hall in the wake of Mayor Lori Lightfoot’s 2022 budget proposal.

In her Sept. 20 City Council address, Mayor Lightfoot touched on issues both systemic and laid bare by the pandemic and her plan to address them through the budget process.

“There is a long list, with its origins and roots traceable to systemic racism, failure to invest in people and places and none of this has happened by accident,” Lightfoot said in her address to City Hall. “They are two sides of the same coin and designed and forged to benefit some, off the backs of others, This is intentional and must be changed.”

By law, the mayor’s office is required to present its budget to the City Council by mid-October, though this year operated on an accelerated schedule due to the pandemic. City Council members then have until Dec. 31 to suggest changes or make additions to the budget so it goes into effect in January.

Here are key components of Mayor Lightfoot’s budget proposal, including an influx of federal aid to Chicago, expanded social service funding and an increase in the Chicago Police Department budget.

FEDERAL AID
Federal Covid-19 relief aid in the American Rescue Plan, lining Chicago’s pockets with nearly $1.9 billion, is the lifeline of Lightfoot’s budget proposal. The mayor plans to utilize the funds to fill in the city’s $733 million budget deficit and prop up social services despite federal regulations prohibiting paying debt with the aid.

“About 40 percent of the total funds are being used to cover last year’s revenue holes, which means repaying bonds sold in order to cover the budget last year,” Adam Schuster, senior director of budget and tax research at the Illinois Policy Institute, said.

To skirt conditions on the federal money, the mayor has essentially planned to support social services with federal aid, thus freeing up local revenue to pay outstanding debts.

“Instead of using the federal dollars to pay off the borrowing, they use the federal dollars to support service spending, and then the local revenues that otherwise would have gone to that are now freed up to pay off the borrowing,” Schuster said.

“It’s a financially and fiscally responsible practice. In the long run, repaying that borrowing will save costs for taxpayers, so I do consider it a good thing.”

However, Schuster views much of this expansion in social services as precarious due to the temporary nature of the Federal aid.

“If you create programs with temporary revenue, you’re giving people an expectation that it’s going to be there in the long run, and then you have to take that program away,” Schuster said.

“To keep that program, you’re going to have to do significant tax hikes in the future,” he said. “So while these investments are welcome, unfortunately, they have not come along with a long term plan to sustain [them].”

Schuster foresees a heftier tax burden on Chicagoans in the future once aid runs out to maintain these services.

Niketa Brar, co-founder and executive director of Chicago United for Equity, believes the city needs a more sustainable funding model for its social services.

“That [funding model] is a fairly limited approach when it comes to the type of creativity and ingenuity we need in order to tackle some of these significant financial challenges,” Brar said.

“While other folks have named ideas such as a public bank, other more progressive leaders have called for federal interventions,” Brar said. “There has not been that type of advocacy or that type of innovation proposed at the city level.”

A point of pride in the Mayor’s proposal is a lack of new taxes on Chicagoans, aside from the yearly increase in property taxes in line with Consumer Price Index fluctuations. Compared to last year’s property tax increase of $534 million, the 2022 budget seems slight in comparison, at only $76.5 million.

“Don’t believe your landlord or if he says that the city’s portion of the property tax has gone up so he has to raise your rent,” John McCarron, a 27-year veteran of the Chicago Tribune’s Financial and Urban Affairs desks and DePaul University guest lecturer, said.

“It really hasn’t gone up but a few pennies for apartments,” said McCarron.

Despite this, Schuster believes the property tax hike could have been avoided entirely due to its negative effect on recovering businesses.

“Given all that federal money, the $76 million dollar property tax hike is hard to justify because you’re spending money on programs to support the recovery, and on the other hand, you’re going to be raising taxes,” Schuster said.

“Even if it’s a modest tax increase … some of that federal money ought to be used to prevent the tax increase in my opinion,” Schuster said.

EXPANDED SOCIAL SERVICES 

“The mayor’s proposal reflects a shift in social winds in Chicago,” Brar said.

“Clearly, she is responding to some of the demands that are coming from grassroots organizations, movements and communities who have been harmed so significantly by this pandemic,” she added.

Chicago United for Equity operates People’s Budget Chicago, a community-based initiative dedicated to designing a budget with the input of the city’s traditionally under-invested neighborhood residents. Though the People’s Budget 2022 report has yet to be released, previous years have consistently ranked mental healthcare as residents’ top priority in budget allocation.

Mayor Lightfoot introduced significant expansions of social services in her 2022 proposal to combat the pandemic and underlying inequities it laid bare. Among the largest social service initiatives are $86 million to increase access to city health services, $202 million for homelessness initiatives, and $635 million to maintain and expand affordable housing, according to the Mayor’s press release.

Despite the Mayor’s proposed increase in funds to the Chicago Department of Public Health (CDPH), there is no specific allocation toward mental health services. It’s up to CDPH itself to dogear those funds.

“What we have not seen is a commitment that the public health dollars will include mental health investment, which has been the most significant area of investment that Chicagoans have called for in the people’s budget,” Brar said.

POLICE SPENDING

The Chicago Police Department budget is proposed to be raised from $1.7 billion in 2021 to $1.9 billion in 2022 to account for last month’s ratification of a new police contract and reliance on surveillance technologies. Initiatives within CPD’s new contract include an instant pay raise for officers and retroactive checks to account for the four years in which officers worked without a contract. Built in is a mechanism for annual raises for officers of 2.5 percent.

“It was heartening to me to see that the police department got a considerable increase in its budget,” McCarron said.

“[And] that the city just entered into an eight year police contract that has rather generous annual increases programmed into it. Which I think is desperately needed in a situation where the veteran cops who have vested pensions are quitting in droves.”

The city renewed its 3-year, $33 million contract with ShotSpotter, a gunshot detection sensor technology through August of 2023 this summer. In the wake of the killing of Adam Toledo by an officer called to his area due a ShotSpotter alert, and reports of its inefficacy from the Office of the Inspector General, Brar saw many community members rethink surveillance technology.

“Frankly, communities are saying this doesn’t work … In this particular year, when we know that a child was killed at the hands of a police officer called to a scene because of ShotSpotter, it’s bringing attention to that issue even more starkly,” Brar said.

Community response has been at odds with the mayor’s proposal to increase Police Department funding, even with new reforms included in CPD’s contract.

“If you spend nearly 35 percent of your budget on policing, and it’s not getting you the outcomes that you want, communities are looking at that and saying, ‘Wait a second, why would we continue to spend more money on police?,’” Brar said.

“Overwhelmingly, what we’re seeing is no, there’s not support for increasing funding to the police.”

The mayor’s budget proposal will be a point of contention in City Hall for the coming months until a modified budget is passed in late 2021. Lightfoot’s proposed usage of Federal funds for social services and the anticipated tax hike or service cut when funding ends, increasing the police budget and