Politics
How Mayor Brandon Johnson Lost Control of the Debate Over Chicago’s 2025 Budget
Mayor Brandon Johnson delivers his budget address on Oct. 30, 2024. (WTTW News)
The first sign that Mayor Brandon Johnson’s proposal to spend $17.3 billion in 2025 was dead on arrival came just minutes after he finished telling the Chicago City Council the only way to balance the city’s budget was to hike property taxes by $300 million.
Despite being one of Johnson’s closest allies, Ald. Byron Sigcho Lopez (25th Ward) wasted no time telling reporters that he would not even consider voting for the largest property tax hike since 2016. Pilsen residents struggling to keep their homes amid a wave of gentrification could not afford the increase, Sigcho Lopez said.
The fact that Sigcho Lopez, Johnson’s hand-picked Housing Committee chair who has voted in lockstep with the mayor, dismissed the budget proposal out of hand sent shockwaves through the City Council, frustrating Johnson’s allies while emboldening his critics. The resulting turmoil has not only weakened the mayor’s political standing but also called into question the ability of progressives to govern the nation’s third largest city, several City Council members told WTTW News.
As City Council members return to City Hall on Monday to wrap up budget hearings after a weeklong Thanksgiving break, there is no clear path to a deal with just 29 days left before the deadline to avoid an unprecedented shutdown of city government.
Ald. William Hall (6th Ward), a stalwart supporter of the mayor, told WTTW News he is confident that the City Council will pass a budget by Dec. 31, the deadline set by state law. City Hall is not engulfed in chaos, Hall said, but rather struggling to adapt to Johnson’s decision to engage in budget negotiations as the city’s “collaborator in chief” after decades of mayors who refused to tolerate any opposition to their spending plans.
“The mayor is engaged in more of a participatory budget process, while other mayors said, ‘Do as I say or else,’” said Hall, who blamed that approach for fueling decades of disinvestment on the South and West sides. “Our mayor is participatory not predatory. Different, not deficient. Different, not dumb.”
Chicago officials have known since the end of August that budget negotiations were going to be fraught, given that the city’s 2025 budget would have to bridge a $982.4 million gap and fill a $222.9 million deficit in the current year’s budget.
Even though the shortfall was in line with estimates released in 2023, it was more evidence that Chicago’s finances are deeply out of whack, pinched by soaring pension costs, spiraling personnel costs and a massive amount of debt.
Left with few painless ways to close that gap and keep his campaign promise not to raise property taxes, Johnson and his budget team delayed his budget address until the end of October. That meant two months would elapse between Johnson’s warning that “sacrifices” would have to be made to balance the city’s budget and when he would unveil his plan to tackle the gap.
Johnson was supposed to give his speech Oct. 16 but moved it to Oct. 30.
The two-week delay was a mistake, Ald. Matt Martin (47th Ward) told WTTW News.
“I was concerned that there hadn’t been collaboration and consultation,” said Martin, a member of the Progressive Caucus who was tapped by the mayor to head the city’s Ethics and Government Oversight Committee.
In a letter, Martin urged the mayor to rethink the two-week delay and to brief alderpeople about his plans to fill the city’s budget gap as soon as possible to allow them to consult with residents of their wards and begin to gather feedback.
“I got no response,” Martin said.
Instead, all 50 members of the City Council learned Johnson had proposed a massive property tax hike from news stories published just as Johnson began his budget address.
“We were all in the dark,” said Ald. Andre Vasquez (40th Ward), the co-chair of the City Council’s Progressive Caucus who has frequently criticized the mayor’s efforts to care for the more than 51,000 migrants who have made their way to Chicago from the southern border.
Johnson’s effort to round up enough votes to pass his budget has also been complicated by a significant amount of turnover in the office charged with lobbying the City Council. The last two deputy mayors for intergovernmental affairs resigned.
The mayor’s office that handles relations with the City Council is now led by Kennedy Bartley, who came under fire for referring to police as “f---ing pigs” during a 2021 podcast interview. In an interview with WTTW News, Bartley apologized for using an anti-police slur, but denied heckling Ald. Debra Silverstein (50th Ward), the only Jewish member of the City Council, during an emotional debate just days after Hamas attacked Israel.
In addition, the mayor has been without a City Council floor leader, whose job is to round up votes for the mayor’s initiatives, for more than a year. Ald. Carlos Ramirez Rosa (35th Ward) resigned from that post, and as Zoning Committee chair, after being accused of bullying Ald. Emma Mitts (37th Ward) during a special City Council meeting in November 2023 called to debate the city’s self-proclaimed status as a sanctuary city.
Johnson’s office also struggled to build public support for his spending plan and communicate the need for such an enormous property tax hike after the Oct. 23 termination of Ronnie Reese, a longtime friend of the mayor and his communications director, which came just days before the budget address. Reese was fired after being accused of sexual harassment and making racist and sexist statements, according to documents obtained by WTTW News. He has denied those allegations.
Tensions between the City Council and the mayor were also high over Johnson’s refusal to reverse course and ink a new deal with SoundThinking, the firm that operated the city’s gunshot detection system, even after a near supermajority voted to object to his decision to terminate ShotSpotter.
But even if the mayor’s office had been operating smoothly, the budget proposal would likely have been impossible to get across the finish line, City Council members told WTTW News.
The mayor’s budget proposal asked alderpeople to put their political futures at risk by voting for a large property tax hike, but offered nearly nothing in return for City Council members to point to when speaking to angry Chicagoans.
For progressive alderpeople, the spending plan failed to make good on their shared promise with the mayor to invest in working-class Chicagoans by strengthening the city’s social safety net.
Johnson’s original spending plan included just $55 million for new initiatives, designed to help Chicago’s unhoused population, reduce violence and create jobs for Chicago’s youth. It also failed to make good on Johnson’s promises to spend between $1.1 million and $3.5 million to test whether city crews should be responsible for clearing not just Chicago’s roads but also its sidewalks of snow and ice during winter storms, a priority for many members of the Progressive Caucus.
For more conservative alderpeople, the lack of any cuts in the budget plan made it impossible for them to reassure residents the city was hiking taxes as a last resort.
With Chicago’s business community and conservative alderpeople firmly in opposition to the property tax hike, the fracturing of the Progressive Caucus made the already difficult task of finding 26 votes for a massive property tax hike impossible.
Just 15 days after Johnson unveiled his spending plan, the City Council unanimously voted to reject the $300 million property tax hike Johnson proposed, sending negotiations over the city’s spending plan back to square one.
Before that vote, Johnson sought to portray the City Council’s rejection of his budget proposal as evidence of his collaborative approach to governing in Chicago, and not a rebuke of his leadership.
“So as a public-school teacher, sometimes we do things to get people’s attention, and so now that we have the attention of everyone, I’ve said from the very beginning, this is a proposal,” Johnson said Nov. 12, calling himself the “collaborator in chief.” “For the first time in the history of Chicago, you’re actually seeing that type of collaborative approach, and we will continue to engage with City Council.”
The strain of the protracted negotiations over the city’s spending plan has begun to sour Johnson’s normally vibrantly optimistic approach as mayor.
After floating a property tax hike of $150 million, Johnson called on members of the City Council to do their job and stop throwing “tantrums.”
“It’s time to grow up,” Johnson said. “People in Chicago don’t have time for that.”
But a majority of alderpeople have roundly rejected a property tax hike of $150 million, Martin said. That would amount to an annual increase of $111 for those who own properties worth $250,000.
Since the City Council’s vote to reject the mayor’s initial proposal to hike property taxes, the city’s budget gap has only widened. State lawmakers failed to fix an issue with the taxes levied on prepaid cellphones, which could cost the city $40 million in revenue it was counting on, officials said.
Johnson also agreed to reverse deep cuts to the number of employees charged with implementing the federal court order requiring the Chicago Police Department to stop routinely violating residents’ constitutional rights known as the consent decree, bowing to intense pressure from advocates for police reform.
City records show the average cost of a Chicago Police Department officer is $150,000 annually, including benefits. That means restoring 162 positions to the city’s 2025 spending plan could swell the city’s budget gap by more than $24 million, according to a WTTW News analysis.
CPD has fully met just 9% of the court order’s requirements in the more than five years since it took effect, according to the most recent report by the monitoring team.
Martin, who helped craft the consent decree, said those cuts were a “huge mistake” that should have set off “alarm bells” for a mayor who promised to quickly implement the consent decree, which is set to cost Chicago taxpayers more than $200 million in 2025.
“It never should have made it into the budget,” Martin said.
The consensus among most members of the City Council is that the final budget will include a mix of tax hikes, including a property tax hike tied to a jump in the cost of living and an increase in the tax levied on software licenses, cloud services and other digital goods. However, a proposal to hike alcohol taxes to generate $10.6 million is deeply unpopular.
Cuts will have to be part of any deal that wins at least 26 votes, several alderpeople told WTTW News.
“There are efficiencies to be found,” Vasquez said. “There is bloat. We have to prove that we’ve tried to tighten our belts.”
There appears to be robust support for Johnson’s plan to make an additional $272 million payment to the city’s four underfunded pension funds. That will prevent the further growth of the city’s pension liabilities and save the city $3.9 billion by 2030, officials said.
If the city cancels the additional pension payment, Wall Street ratings agencies could lower the city’s credit rating, making it more expensive for the city to borrow money, making Chicago’s financial hole deeper.
S&P Global Ratings put the city on a negative credit watch before Thanksgiving, finding there is at least a one-in-two chance of a downgrade in the next 90 days.
Members of the City Council have begun to offer suggestions and proposals on where to cut that will not require services to be cut and employees laid off. Johnson has said he will not sign a budget that puts Chicagoans out of work.
“That is very healthy for the city,” Vasquez said, after decades of the City Council rubber-stamping budgets proposed by mayors. “That era is over.”
Ald. Maria Hadden (49th Ward) said she has been pleased Johnson has taken a less aggressive approach to budget negotiations than his predecessors.
“They are not threatening people,” Hadden said. “They are not strong-arming alderpeople, and I appreciate that.”
But if the City Council approves a budget that requires layoffs, those alderpeople who vote for it should have to look those employees in the eyes who could be out of work come Jan. 1, Hall said.
“They should have to hand deliver those pink slips,” Hall said. “The priority should be to keep people on the payroll.”
Fifteen alderpeople, who frequently oppose the mayor’s initiatives, sent him a letter identifying $568 million in cuts designed to roll back spending to 2020 levels, adjusted for inflation. None of those cuts would come from the Chicago Police Department, which accounts for nearly 46% of Chicago’s discretionary spending.
That is unrealistic, Hadden said.
“Some folks want to pretend the cost of government hasn’t risen,” Hadden said.
While the city faces significant financial peril in the coming weeks, Johnson’s political fortunes also hang in the balance.
Hadden, Martin and Vasquez acknowledged that the tumultuous budget negotiations have fueled a growing sense that progressives are incapable of fulfilling their promises and governing responsibly.
“I do worry about that perception,” Hadden said. “Governing is hard, and we have to prove we can do it.”
But Martin said Johnson’s approach to the city’s financial woes was fundamentally flawed.
“There is nothing progressive about a $300 million property tax hike,” Martin said. “There is nothing progressive about cutting consent decree positions. We need to show voters a better track record when it comes to crafting a budget.”
Contact Heather Cherone: @HeatherCherone | (773) 569-1863 | [email protected]
