October 31, 2014
The Civic Federation supports the City of Chicago's proposed $7.3 billion budget because it reflects both reasonable structural changes and significant actions toward long-term stability, including the 2014 pension reform law for the City's Municipal and Laborers' pension funds and the continued phase out of the City's retiree health care subsidy.
The Federation remains deeply concerned about how the City will manage rising debt service payments and pension costs in future years. For the last three fiscal years, the City of Chicago reduced its annual debt service payments by refunding bonds that are due to mature and extending the life of these bonds for an additional 30 years. Also, the City's Police and Fire pension funds, not included in the 2014 reform law, remain dangerously close to running out of funds with market value funded ratios of only 27.0% and 31.7% respectively in FY2013. The Mayor, City Council and State legislators must work together to create a reform framework that will stabilize these funds at an affordable cost to taxpayers.
The City of Chicago’s fiscal year begins January 1, 2015 and ends December 31, 2015.