Chicago Mayor’s $1.25B Housing Bond Plan Hits Roadblock

Mayor Brandon Johnson’s updated plan to borrow $1.25 billion for affordable housing and economic development projects was hit with a setback during Monday’s Finance Committee meeting.

The plan, aimed at reducing the city’s reliance on tax increment financing by instead using municipal bonds, was met with demands for increased City Council oversight, the Chicago Sun-Times reported.

The Finance Committee seemed poised to greenlight a plan supported by aides to former Mayor Lori Lightfoot and endorsed by Johnson. However, Alderman Bill Conway, an outspoken critic of Johnson, introduced amendments that significantly altered the policy.

He proposed reducing the bond amount to $350 million and lowering the threshold for council approval of specific projects from $5 million to $1 million. While these amendments were ultimately tabled in an 18-13 vote, they signaled a contentious debate ahead.

Finance Chair Pat Dowell called for a recess and adjourned to discuss the matter behind closed doors with officials from the Mayor’s Office of Intergovernmental Affairs. Upon reconvening, Dowell postponed the vote until Wednesday, citing the need for further negotiations.

“How will this affect our ability to use TIF surplus in the future to support the budget? This year, we used $434 million,” Conway said. “What impact will this have on our bond rating, with the outlook just lowered a couple of weeks ago?”

The proposed plan would allocate the bond proceeds equally between the Housing and Planning and Development departments, totaling $625 million each over five years. Housing initiatives would focus on affordable housing construction and preservation, while Planning and Development would support neighborhood development and small businesses, the outlet reported.

Despite Johnson’s reassurances about recouping costs through property tax revenue from expiring TIF districts, skepticism persists among Council members. Aldermen such as Scott Waguespack have questioned the lack of comprehensive fiscal analysis and urged a closer examination of the plan’s implications.

Alderman Ray Lopez noted that the mayor’s camp appeared apprehensive about potential amendments, indicating underlying tensions within City Hall.

—Quinn Donoghue