Chicago mayor tries to build support for harsh cuts at budget forums

Reuters News
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Posted: Aug 31, 2015 3:02 PM

By Fiona Ortiz

CHICAGO (Reuters) - Chicago Mayor Rahm Emanuel will hold a rare public forum on Monday as he tries to build support for likely tax hikes and harsh cuts in public services to stem the city's growing financial crisis.

The city's first-ever garbage collection fees, less-frequent recycling pick-ups, higher property taxes, fees related to e-cigarettes and other items are all being discussed as partial remedies to try to plug an estimated shortfall in next year's budget that could hit $750 million.

Emanuel, along with his budget director and chief financial officer, will take suggestions from the public at the evening town hall meeting, followed by two more such forums on Wednesday and Thursday.

Emanuel has not held a public budget meeting since 2011, his first year in office. He was re-elected to a second term earlier this year.

"He's trying to get people to understand the magnitude of the problem, and to be willing to bear the pain that's inevitably coming," said Dick Simpson, professor of political science at the University of Illinois at Chicago and a former alderman.

"There are going to be very difficult budget decisions this year. Property taxes will go up as much as 50 percent."

The mayor is speeding up the process for the 2016 budget, which will take effect on Jan. 1, presenting it to the City Council on Sept. 22 instead of the customary October date.

Chronic structural budget deficits and a $20 billion unfunded pension liability have led to a slew of credit rating downgrades. Moody's Investors Service in May dropped Chicago into junk-bond category, meaning the city has to offer high interest rates to sell its debt in the municipal bond market.

    Emanuel has pushed for pension payment relief from the state of Illinois to help the city, and especially its schools, which have their own separate budget crisis. But those requests have become entangled in an impasse over the state's own budget.

Past Chicago mayors held regular budget forums around the city, but Simpson said it was rare for ideas from the public to actually make it into revenue and spending plans.

The town hall will be live streamed and the public can also participate through a Twitter hashtag, #ChiBudget2016.

Among the ideas tweeted on Monday morning to the hashtag were a tax on gun ammunition, auctioning off reserved parking spaces on city streets and a tax on commuting suburbanites.

(Reporting by Fiona Ortiz; Editing by Dan Grebler)