Chicago is one step closer to avoiding a government shutdown after the City Council held a final vote on a budget plan following an hours-long session on Saturday, but the city is not out of the woods yet.

The new budget does not include the head tax that would tax large corporations, which Mayor Brandon Johnson has been pushing for. That has been a big line in the sand for the city council. 

The final budget passed 30 in favor and 18 opposing. However, a government shutdown is still possible if Mayor Johnson decides to veto the plan.

The mayor has repeatedly refused to give a straightforward answer when asked if he would veto the budget plan, which is an alternative plan devised by alders who opposed the mayor's initial plan and in particular the head tax.

The mayor's team said there should be an answer by Monday if he plans to isse a veto. If the budget is not signed by Dec. 30, the city would face an unprecedented shutdown.

Mayor Johnson said he agrees with 98% of what's in the plan, but that 2% deeply concerns him, and that's the main focus at this point.

The mayor's critics said their budget plan includes $46.6 million in spending cuts and other efficiencies, but the mayor's budget team estimated their proposals would save only $6 million, claiming many of their proposals already were in the mayor's budget plan, or are simply not feasible.  

Harold Washington was the last Chicago mayor to veto a budget, 41 years ago, during the infamous Council Wars.

In that case, the mayor and his opponents — a group of largely 29 White alderpeople led by now-convicted former Alds. Edward Burke (14th) and Ed Vrdolyak (10th) — reached a compromise to pass a budget just hours before the year-end deadline after Washington's rivals couldn't override his veto.  

"We have the same fight that we had in the 80s. We have the new Vrdolyaks trying to come back," said Ald. Byron Sigcho-Lopez (25th).

Some highlights of the new budget include:

• Increasing the city's plastic bag tax from 10 to 15 cents.
• Overhauling tax on off-premise liquor sales.
• Legalizing video gambling terminals in Chicago.
• Selling debt owed to the city for unpaid fines and fees.

These plans do not sit well with Johnson and his allies. 

Aldermen estimated $6.8 million in new revenue in 2026 from legalizing video gambling, but the mayor's budget team claimed that move would result in a loss of $3 million next year, because it would force the city to lose out on $4 million payment from Bally's casino, and only a small fraction of businesses who apply for a video gaming license would actually get approved in 2026.

In proposing to increase the city's plastic bag tax from 10 cents to 15 cents per bag, aldermen estimated $8.7 million in new revenue, while the mayor's budget team claimed that move would generate only $5.2 million, due to a likely drop in shoppers using plastic bags.

The alternative budget estimated $6 million in new revenue from a new 1.5 tax on off-premise liquor sales, replacing the current volume-based tax, with different rates for beer, wine, and spirits. However, the mayor's budget team estimated that move would actually result in a $4.2 million loss for the city.

The biggest sticking point for the mayor's budget team was aldermen's proposal to bring in $89.6 million from selling the debt owed to the city for unpaid fines and fees. Johnson's aides said the plan is simply not feasible and wouldn't generate actual money from the city, claiming there is no realistic way to find investors to buy debt for things like unpaid parking tickets when the city has no authority to seize vehicles or place liens on property for such debt.

Johnson put forward a last-ditch effort on Friday to reintroduce a head tax on corporations, which was shut down.

"We have heard from our colleagues that selling our debt would result in predatory practices. We know that to be true," said Ald. Jessie Fuentes (26th).

"I encourage everyone to vote yes. It's not perfect," said Ald. Pat Dowell (3rd).

Mayor Johnson ended the Saturday session with a speech that did not mention a veto, but how this budget could have ramifications on Chicago's poorest communities.

"Even though this 1.67% of this budget could have severe consequences of those very people, their fight has not ended because this vote has been taken," the mayor said.

Again, the final budget passed 30 in favor and 18 opposing it. It needed 34 yes votes to prevent Mayor Johnson from vetoing, so a veto is still on the table, which could lead to a government shutdown.

"It's clear that if he vetoes it, this is on him," said Ald. Bill Conway (34th). "This shutdown would be totally on him."

"A shutdown would be a hard stop," said Ald. Samantha Nugent (39th). "No one can afford for this to happen."

The mayor will either sign this budget, or there will be a veto meeting on Monday, Dec. 29.

If the mayor does sign the budget plan, aldermen said there could be video slot machines up and running in the next three to six months.

The mayor's team has not shared any shutdown plans with the council or the public.