today unveiled a new budget that he says doesn't include new tax, fine or fee increases but contains a warning about the financial havoc the city's looming government worker pension problem could wreak.
Much of the mayor's speech is a listing of what he views as the greatest hits from his first budget last year: more efficient garbage collection, a wellness program for city workers and cracking down on those who owed money to
Last year, Emanuel raised water and sewer rates, vehicle sticker fees and a host of fines to help balance a budget that was far more out of whack than this one. Today, Emanuel made a promise about asking city taxpayers for more money in this spending plan.
"We will not raise property taxes; we will not raise sales taxes; we will not raise the fuel tax; we will not raise the amusement tax," he told aldermen.
The budget gap was $298 million, and Emanuel proposed a series of smaller changes to close it. Some of it is hoped-for, including $18 million from selling advertising on city buildings, a plan that didn't much bear fruit when the mayor proposed it last year.
Rising homicide rates have plagued some of Chicago's neighborhoods this year. Emanuel indicated that he plans to try to keep up with police officer retirements, but it doesn't appear the
will get a net gain of officers.
"By the end of this year, 457 recruits will be in training, the largest number since 2006. When the first of those recruits graduate on December 17, they will be the first of regular recruit classes we will have every quarter in 2013 -- so that our force will always be at full strength," Emanuel said in prepared remarks.
"They will be commanded by an expanding corps of experienced leaders," he added. "In August, I attended the graduation of 30 sergeants and 26 lieutenants at
, the first graduation in more than 2 years. We will increase the regularity of promotions and next year the police department will hold the first sergeant’s exam in six years."
Noting that about half the community oriented cops in the CAPS program are at police headquarters, the mayor said “CAPS has become way too bureaucratic.” He said all CAPS officers would be moved back to district stations.
Emanuel wrapped up his speech by warning that the city faces major increases in pension payments for city workers --- $700 million more just for police and firefighter retirement funds in 2014, budget experts say. To that end, Emanuel kicked off his latest push to wring cost-cutting pension reforms out of state government in Springfield, where leaders are worried about their own pension cost issues.
"If we do not come to terms with our past and take on our long-term challenges, all of this hard work will go out the window," Emanuel said. "That is what we face if we do not fix the crisis surrounding our pension payments -- or if we do too little, too late. The residents of Chicago elected us to tell the hard truths so that we can make the tough decisions. We need to be honest with everyone about the challenges we face and the difficult choices we must make to solve them."
The mayor, however, didn't detail specifics of what kinds of changes he wants. Labor unions have opposed many of the pension reform suggestions that have been floated in Springfield.
Emanuel warned that city services would have to be cut or propery taxes raised if ways are not found to reduce pension costs. The city uses property taxes to pay for pensions, but there's no requirement that it use that source. Either way, however, more money would have to go toward pensions.
Aldermen were hoping for more details Wednesday after being briefed without many specifics on Wednesday. Aldermen said they told there would be a City Hall consolidation, but not given specifics. A budget spokeswoman later told the Tribune that unspecified workforce reductions would be done mostly through attrition, with no more than 200 layoffs.
"Nothing was enumerated or spelled out," said Ald.
, 2nd. "There were no specific plans laid out for what departments would be targeted or what employees might be reclassified."
The administration did outline for aldermen some services the mayor plans to expand, including $5 million to fund more than 5,000 extra early-education slots and $4 million to put 4,000 more kids in after-school programs. There also will be more staff dedicated to killing rats and trimming trees, aldermen said, as well as a promise to hire enough officers to keep up with attrition at the police department.
And the mayor plans to provide court advocates to an additional 3,000 victims of domestic violence by partnering with social service agencies, academic institutions and policy groups, all at no additional cost.
Even as the mayor and his staff try to paint that positive picture, they reiterated a warning that chronic underfunding of city pensions will catch up to Chicago next year if state law isn't changed.
Pnsion reform isn't the only major issue the city will have to resolve come next year. The city's major labor contracts, for police and firefighters, have expired and are under negotiation.
The city layoff numbers are lower than last year, in part because Emanuel hit taxpayers in the pocketbook with this year's budget. He began the process of doubling water and sewer fees, boosted the cost of vehicle stickers and increased the hotel tax and the taxes on downtown parking. The 2011 budget also increased a host of fines for various infractions, from not cutting grass to playing loud music in a vehicle.
The city also reduced the number of police stations, cut library hours, reduced the number of 911 operators, cut back on graffiti-erasing crews and closed half the city's mental health clinics.
This time around, Emanuel has indicated he will rely more heavily on rosier revenue projections tied to a better economy. The administration is predicting $45 million in revenue growth from its share of the state income tax and collections of real estate transfer, retail sales and hotel taxes. It is also counting on $69.2 million in higher debt collections this year, along with a projected $24 million increase next year, to close a budget hole most recently estimated at $298 million.
Aldermen were shown plans to siphon off $10 million for the city from tax increment finance districts, or TIFs — in which property taxes paid to local governments are frozen for up to 23 years, with any extra collections being used at the city's discretion as a way to spur development and create jobs.
To do that, the mayor plans to declare $25 million in 22 TIF funds as surplus. Of that, $5 million would go to the city, with the rest going to other taxing agencies, primarily
. He would get another $5 million from TIF accounts that have expired or that he plans to close.
Emanuel also is banking on spending $23 million less on health care, in part by negotiating lower fees for management of the city's self-funded insurance program. The mayor also expects to save $40 million by refinancing some city debt.
More savings are predicted from the ongoing conversion of garbage pickup to a grid system as well as moving other services away from the traditional ward-by-ward system.
Among other new details, Emanuel said his budget puts $15 million back into the city reserve fund. And he said the city will triple to 30,000 the number of Chicago Public Schools students who get free eye exams and glasses. The city also plans to replace 90,000 ash borer trees.