Chicago’s finances have once again taken center stage with Mayor Brandon Johnson’s $17.3 billion budget proposal.
Johnson’s 2025 budget proposal, 3 percent higher than the previous year, aims to close a daunting $982 million shortfall through increased property taxes, funding reallocations and personnel adjustments, Crain’s reported.
The budget’s reliance on a $300 million property tax increase marks a significant shift from Johnson’s campaign promises to avoid such tax hikes, risking political fallout as it heads to a divided City Council for approval. Johnson needs to secure 26 votes for the proposal to pass.
The 2025 budget would increase the city’s property tax revenue by an estimated 4 percent for most property owners, based on 2023 assessed values, though reassessments may cause fluctuations.
The $300 million hike is aimed primarily at covering pension obligations, with Johnson affirming, “We will not leave a legacy of unpaid bills to the next generation.”
Besides property tax hikes, the proposal relies on $570 million from tax-increment financing districts, with $132 million dedicated to the city’s budget and $311 million allocated to Chicago Public Schools to help absorb a $175 million pension payment initially on the city’s books.
Another $42.7 million is anticipated through the elimination of 743 funded but vacant positions, including over 400 roles in the Chicago Police Department, though exact counts between sworn officers and civilian positions have yet to be disclosed.
The move could stoke debate within City Council as members assess the potential impacts on public safety. To help balance migrant and homeless assistance needs, Johnson’s budget earmarks $40 million — $25 million in new investments — for an expanded shelter system, doubling homeless beds from 3,000 to 6,800, while cutting a previous $150 million migrant fund.
Additionally, the city will seek $10.6 million by increasing the liquor tax, with budget director Annette Guzman explaining the tax “has not kept pace with inflation.” Another $4.6 million will come from reclaiming 2 cents of the 7-cent bag tax allotted to retailers.
Johnson’s plan to continue $272 million in advance pension payments underscores his focus on reducing long-term debt, even as he weighs future inflation-linked property tax adjustments.
Whether Johnson’s property tax hike and TIF reallocations will gain the 26 votes necessary for passage remains in question.
— Andrew Terrelll
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