October 26, 2022
Praises the budget’s supplemental pension contribution, restraint on taxes, but calls for much greater transparency around policing and the federal Consent Decree
CHICAGO – In a report released today, the Civic Federation expressed its support for Chicago Mayor Lori Lightfoot’s proposed FY2023 budget of $11.8 billion because avoids a general property tax increase and at the same time makes a sizeable supplemental payment to the City’s pension funds. However, the Federation expresses concern about the budget’s reliance on one-time revenues as well as its lack of transparency around public safety investments and lack of detail on the cost of the federal Consent Decree.
The full analysis is available at civicfed.org/ChicagoFY2023.
As detailed in the report, the Civic Federation views the City’s proposed budget as positive overall for the City and its residents. This is a result of several revenue sources growing faster than expected even a few months ago and allows for a $242 million supplemental pension payment. The Civic Federation views this as a prudent use of higher-than-expected revenue. At the same time, the proposed budget allows the City to avoid a 2.5% property tax levy that had been proposed in the Budget Forecast released in the summer.
“This budget is good news for taxpayers,” said Civic Federation President Laurence Msall. “There are no general tax increases and the City’s financial improvement as recognized by a recent Fitch Ratings upgrade should save taxpayers money on future borrowing.”
While the City has made important progress in increasing its budgetary reserves, the Civic Federation cautions that the use of nonrecurring revenues, including American Rescue Plan Act (ARPA) revenue replacement funds and fund balance, as well as the possibility of a recession in 2023 could make balancing future budgets more difficult. In addition, the Federation is concerned about the City’s lack of transparency around public safety spending and how it has communicated its progress toward fulfilling its obligations under the federal Consent Decree. The proposed FY2023 budget’s $100 million in additional public safety spending is not explained in sufficient detail within the budget document.
The Civic Federation offers several recommendations to improve the City’s budget and to address growing public safety and gun violence concerns in the City of Chicago, which mirror increases in crime and violence across the country but also demand a Chicago-specific response. The Federation calls on the City to dramatically increase transparency around the cost of implementing the federal police Consent Decree and other public safety initiatives, and to improve communication regarding the Police Department’s compliance in the Consent Decree’s implementation. It also calls for the publication of a study on the City’s police staffing allocation.
“There is a lot of work that needs to be done to better communicate the City’s strategy for improving policing and reducing violent crime,” Msall said. “We have concerns that the federal Consent Decree is not being used effectively as a tool to improve constitutional policing. And while it appears the Mayor is making progress, the lack of transparency around police staffing levels and resource allocation must be addressed.”