Courtesy of Illinois Policy Institute
Pension reform and reasonable labor contracts are the answers to Chicago’s nearly $30 billion net deficit, according to a new Illinois Policy Institute analysis. The Institute found pensions and personnel costs are the No. 1 cost-drivers of the city’s budget deficit, consuming $5.2 billion total, or nearly 60 percent of the city’s $8.9 billion local revenues this year. The analysis examines the magnitude of these costs and provides recommendations for Chicago Mayor Lori Lightfoot ahead of Thursday’s “State of the City” address.
What to Know:
Pensions
• Total debt in Chicago-controlled pension funds is $29.2 billion. Including the other four pension systems Chicago taxpayers are on the hook for, that burden rises to $41.8 billion, more than 44 U.S. states.
• When tallying all Chicago and Illinois debt, each Chicago taxpayer owes $119,000, the highest taxpayer debt burden among the 10 most populous U.S. cities.
• Chicago’s pension contributions are set to spike twice during the next decade: In 2021, pension contributions could reach $1.67 billion, about $5 million higher than this year’s contributions. By 2023, pension contributions could reach over $2.1 billion, roughly a $1 billion increase from just four years earlier.
• During former Chicago Mayor Rahm Emanuel’s term, Chicagoans suffered $864 million in annual tax increases through property taxes, water and sewer fees, and the 911 surcharge.
