CHICAGO (CBS) -- As she continues working behind the scenes to wrangle at least 26 votes in City Council for her 2021 budget plan, Mayor Lori Lightfoot on Monday defended her call for a $94 million property tax hike, plus annual property tax increases that would be tied to inflation every year going forward, saying a $1.2 billion shortfall left her "zero easy choices."
"We are in an extraordinary circumstance. When this year dawned, none of us thought that we'd be experiencing any of the things that have happened over the course of the year. We certainly didn't think you'd be in the midst of the once-in-a-generation economic meltdown occasioned solely as the result of COVID-19," Lightfoot said Monday afternoon.
Later this week, the City Council Finance Committee is expected to take the first vote on the mayor's property tax plan and the rest of her revenue package for her $12.8 billion budget plan for next year, and it's unclear if she has enough votes for approval by the full City Council.
In addition to the property tax increase, the mayor's budget plan includes a 3 cents per gallon gas tax increase, refinancing $501 million in debt, and eliminating nearly 2,000 vacant positions.
Over the weekend, Lightfoot canceled plans for 350 layoffs, amid stiff opposition from aldermen and labor unions. The mayor's office did not provide specifics on an agreement with the Chicago Federation of Labor to avert the planned layoffs, but according to published reports the city instead would borrow against future marijuana tax revenue to make up for the $15 million in savings expected from the planned layoffs.
Lightfoot said she remains in negotiations with aldermen on her overall budget plan.
"There are zero easy choices here, none. Everything was difficult. Everything took a lot of time and effort to analyze. The changes that we've made since we introduced the budget in May and mid-October have been the result of a lot of thoughtful and productive conversations with a variety of members of City Council, as well as our friends in organized labor," she said. "It's not ideal, but it is I think the best choices that we have under the circumstances."
Asked if she'd be willing to forego future property tax increases tied to inflation if it would get her the votes for the $94 million property tax hike in 2021, Lightfoot said, "I feel like we are all on the right path as we are right now."
The mayor said one of the things driving the decisions she's made in her budget plan is the fact the city's four employee pension funds are "woefully underfunded," and the city's need to meet its obligation to retirees, and city employees who will be retiring in the future.
Lightfoot said some of the city's pension funds "are literally selling off assets to meet their obligations."
In defending her call for annual property tax increases tied to inflation, the mayor said she's not willing to skip hard decisions now, and create an even more difficult problem down the road.
"I think that having predictability around what the property tax obligation is going to be – a modest inflator of averaging about 1.8%, which the average Chicago home means around 56 additional dollars a year – it's not something that anybody says, 'Absolutely, this is great,' but I think it's necessary," she said. "I think it's prudent, and given what our financial obligations are, and the structural challenges that we face, this is I think the best solution that we have to meet our financial obligations in the out years."
The next City Council meeting is scheduled for Nov. 23. Aldermen won't be able to hold a final vote on the mayor's budget plan until one meeting after that, a date for which has yet to be scheduled, though the soonest it could come would be Nov. 25.
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