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What You Need To Know About Emanuel’s Final Budget Plan

Chicago Mayor Rahm Emanuel is expected to deliver his final, (relatively) painless city budget proposal to the City Council on Wednesday. It’s an election year budget, so don’t expect any hugely unpopular provisions that politicians will have to explain to voters in a few months.

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Mayor Rahm Emanuel at City Hall

Mayor Rahm Emanuel at City Hall in July 2018.

Bill Healy/WBEZ

Chicago Mayor Rahm Emanuel is expected to deliver his final, (relatively) painless city budget proposal to City Council on Wednesday.

It’s an election year budget, so don’t expect any hugely unpopular provisions that politicians will have to explain to voters in a few months. (Emanuel and a handful of aldermen have already announced they’re not running again in February.)

This sets the stage for a spending plan that’s heavy on what one alderman has called “the holy trinity” of constituent services: tree trimming, rodent killing, and graffiti removal. It’s also expected to be low on tax and fee increases, or what Emanuel and aldermen often call “hard choices.”

Here are four things to know before Emanuel outlines next year’s roughly $10 billion spending plan.

1. There’s a budget deficit, but you likely won’t be walloped with a big tax increase. Yet.

The 2019 budget anticipates a nearly $98 million operating gap, which Emanuel plans to close in part through “savings in commodity purchases, department and healthcare cost reductions, and debt service savings,” said budget office spokeswoman Kristen Cabanban. She didn’t immediately offer more details.

The short-lived sweetened beverage tax Cook County implemented — then repealed — last year made clear there’s little appetite for any more revenue increases.

That means, barring surprises, you’re probably safe from any giant tax or fee hikes. Emanuel and aldermen already got some painful ones out of the way years ago: The mayor’s first budget after his 2015 re-election included a record property tax hike for the benefit of the city’s police and fire department pensions and a new $9 monthly garbage fee for homeowners. In the following years, the mayor and City Council increased the water-sewer tax and the $5-a-month 911 surcharge to help upgrade the city’s emergency phone system.

2. That giant pension crisis ain’t getting solved this year.

But the pension chickens will come home to roost soon. That’s because the city’s state-mandated payments to its workers’ retirement funds are set to more than double over the next five years, from just over $1 billion this year to $2.1 billion in 2023.

That means even if Emanuel isn’t leading his final budget with another painful plan to pay for pensions, the next mayor will be forced to find money for ever-increasing pension costs — and fast.

There are no plans in this budget to borrow money to pay for pensions or cover operations, as has been the case in past budget rollouts. In briefings with aldermen held last month, the Mayor’s office told aldermen that a recently-floated plan to offer special pension obligations bonds won’t be included in the budget, but is still on the table.

Next year, the city is on the hook for nearly $1.2 billion in payments to its pension funds for police, firefighters, laborers, and municipal workers.

3. The mayor will tout spending money on kids, social services, and quality of life stuff.

Planned investments in anti-violence initiatives, job training, and mentorship programs are often a hallmark of the mayor’s budget rollout. But they’re a pretty small piece of the overall $10 billion spending pie (the 2019 budget proposes $42 million for such efforts). This year, Emanuel’s administration wants a stronger focus on programs to help former prison inmates find jobs, including in some city departments.

Emanuel also plans to address the garbage cart backlog with an additional $2.8 million for new black and blue carts.

Last year, the city covered about $80 million in security and after-school expenses for Chicago Public Schools, about $14 million of which came directly from city coffers. But this year, City Hall won’t be making that direct payment, because Emanuel’s office says the school district is now getting more money under a new statewide school funding formula the mayor’s office lobbied hard for. The city will, however, be giving CPS $97 million in surplus money from special taxing districts, or TIFs, according to Cabanban, the budget office spokeswoman.

4. Chicago Police Department reforms will cost a good chunk of money.

The city of Chicago and the Illinois Attorney General’s office are still negotiating a consent decree that could enforce significant changes at the Chicago Police Department. And that kind of court-ordered oversight comes at a price.

Mayor Emanuel’s office has been quiet about the details, but his budget will include nearly $26 million to cover the cost of the consent decree. This includes salaries for the independent monitors tasked with enforcing the reforms.

Meanwhile, the city once again low-balled the amount of money it needed for legal settlements — mostly relating to the Chicago Police Department — and will have to account for that shortfall in next year’s budget. According to the Law Department’s latest numbers, the city has paid out more than $73 million in settlements, which is about $26 million over the budgeted amount. That number only covers payments through the end of August.

The mayor’s office also plans to spend more money on crime-fighting technology. This includes an expansion of a new license plate reader technology to combat carjackings, more money for citywide security cameras, and so-called ShotSpotter technology.

Claudia Morell covers city politics for WBEZ. You can follow her on Twitter @claudiamorell.

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