October 21, 2009

Mayor Daley Proposes Balanced 2010 Budget

Daley Says Budget Responsibly Addresses Challenges of Tough Times: Addresses Urgent Needs, Better Manages Government, Provides Property Tax Relief
Mayor's Press Office    312.744.3334

Mayor Richard M. Daley today presented to the City Council a balanced 2010 City budget that maintains services, better manages government, protects taxpayers and includes a $35 million property tax relief program targeted to help property owners affected by the phase-out of the "7% cap" in Springfield.

The property tax relief program is one of a number of programs in the budget to be funded by the City's parking meter Human Infrastructure Fund, Daley said.

The Mayor called the document a "responsible budget for tough times" and said he knows that people are struggling to make ends meet.

"During these tough times, more than ever, Chicago's working and middle class families need our support and to them I want to say: I hear you. I know you're struggling. I am fighting for you," Daley said in his annual budget address delivered in the City Council Chamber.

Daley said that in a step he had hoped he would not have to take, the City will borrow from its parking meter reserve funds to fund some essential services.

"I had hoped to avoid this and I understand that some may have problems with it. But, as Mayor, I have the responsibility to provide the services that people need, especially now during tough times when they demand more from government, not less.

"Now is not the time to burden people with higher taxes or the elimination of essential city services. So, I believe it is responsible to borrow from the reserves," he said.

About $270 million will be taken from the parking meter long-term reserve, with the plan of replenishing it when city revenues have rebounded. The City also will advance the $100 million 2012 parking Meter mid-term reserve into.

The Skyway long-term reserve account of $500 million will remain intact, as will $130 million in the parking meter long-term reserve fund and $100 million in mid-term reserves split evenly between the Skyway and parking meter funds.

Therefore, the city's long term reserve fund will have a balance of $730 million, the Mayor said.

Daley said that despite the recession, his proposed budget addresses Chicago's most urgent needs: job creation, violence against young people, getting more from every tax dollar in difficult economic times and addressing the concerns of people regarding wrongdoing at all levels of government and business across the country.

The Mayor repeated his announcement of two days ago that the budget does not raise property taxes or contain any new tax, fine or fee, or increase any current tax, fine or fee. "With so many people struggling, this isn't the time to ask them to pay more," he said.

Despite the recession, the City will maintain essential services and the number of sworn police and fire officers, the Mayor said. He said the reason for the city's $520 million deficit is twofold: Economically sensitive revenues have dropped by 17% this year because of the recession and the cost of government salaries, pensions and health care - which accounts for 80 percent of City expenditures -- continues to increase.

The major areas addressed by the proposed budget are: Balancing the Budget
Daley said that, in addition to using $56 million in parking meter reserve funds, the City will close the 2010 projected $520 million deficit in a variety of ways:

  • Cut $114 million in spending, in addition to the $59 million in spending already cut this year. This includes cutting another 220 vacancies, cutting non-personnel spending for contracts across the Board by 5% and other steps.
  • Continue to implement the agreements reached this year with both union and non-union personnel regarding work hours and furlough days. The agreements will save the city $73 million next year. Non-union employees - including the Mayor - will take 24 unpaid and furlough days in 2010.
  • Close out two Tax Increment Financing district funds that are inactive or set to expire soon. This will generate $8 million for the city.

Daley went on to make it clear that it was because of the parking meter and Skyway leases that the city would be able to fund many programs to help working families and those who most need the city's support next year.

He also said that "without these agreements, we would have been forced to raise property taxes - both this year and next year. And we would have been forced to raise other taxes and fees, as well. Without them we would have been forced to eliminate key programs that people depend on." Property Tax Relief/Addressing the Needs of People
The Mayor said the property tax relief program will provide grants to help homeowners offset any increases in their 2008 property tax bills for their primary residences, particularly for those homeowners hit hardest by the lack of a 7% cap on assessment increases.

Homeowners who apply will receive a grant up to $200 based on their income. Further details will be announced soon.

Daley also said that by using parking meter fund proceeds the city would be able to increase funding for meals to seniors, housing rental subsidies for low income families and programs for ex-offenders. The city will also increase funding for the Share the Warmth program, which helps needy families pay their heating bills, for homeless shelter beds and to maintain funding for the Plan to End Homelessness.

Preventing Violence Against Chicago's Young People
Daley said that his budget tackles the challenge of youth violence.

He said he had instructed the Chicago Police Department to deploy more officers to troubled schools and on the CTA during dismissal times and asked the CAPS program to help create safe passages for students to and from troubled schools and to strengthen and create new block clubs to become the "eyes and ears of the community."

He said that despite troubled times he had made it a priority to fund after school and jobs programs to keep the City's children involved in positive activities. The proposed 2010 budget invests over $33 million in these efforts. Growing Chicago's Economy

Daley also said the 2010 budget invests in programs to help turn around Chicago's economy by creating new jobs and opportunity, new businesses and by providing job training.

He said the city will use up to $25 million ($8.4 million this year) in parking meter revenue to fund a job training program, called TechCorps, for Chicago workers who have been laid off during the bad economy.

Further, Daley said that in the next few weeks, he will announce a major new collaboration between government and Chicago's business community, focused on using resources more effectively to help recruit and retain businesses and trade shows in Chicago.

And, he will soon propose new steps to help the City's small businesses stay afloat, so they too can retain and create jobs.

Preventing and Uncovering Misconduct

Daley said he knows the people of Chicago are concerned about wrongdoing at all levels of government and business across the country and that his budget will help the city uncover and prevent misconduct and improve the transparency of government in several ways: 

  • It supports the Office of the City's Inspector General, to which position Daley recently appointed veteran Assistant U.S. Attorney Joseph Ferguson.
  • It will strengthen the Office of Compliance and its ability to uncover fraud and misconduct in the women and minority owned business program
  • It calls for posting online all current statements reflecting the financial holdings of elected officials, city employees and members of boards and commissions, starting with Daley and his top staff.

Improving Neighborhood Quality of Life

Through the city's capital program it will reconstruct 11 miles of sewers and lining and rehabilitate an additional 40 miles of them. It will resurface more than 550 blocks of local streets and more than 110 alleys and replace more than 150 blocks of sidewalks.

Daley said the city will start construction for a new fire station, a new police station and five new branch libraries.

In closing Daley reminded his audience that while other cities and states are cutting key services and raising taxes, Chicago is not.

"Some will say we should have cut essential services and raised taxes to balance our budget. I disagree. During these tough times, that's the last thing people need," Daley said.

"I choose to be on the side of Chicago's working and middle class families. With this budget, I'm confident that we will get through these tough times and that we'll build a better, stronger Chicago for them and every Chicagoan," he said.