Let the bloodletting begin. Wednesday Chicago Mayor Rahm Emanuel acknowledged the elephant in the room - a property tax increase of $225 million for City residents, a move that he claimed earlier that he was loathe to make, but yet, was almost inevitable in a climate of mistrust, misinformation and mistakes.
For a taxpayer with a home valued at $250,000 thousand, he will see an additional tax of $225 each year; and this is just one example of how Chicagoans will have to pay the piper to pay for the borrowing that Emanuel has been forced to do. In the most recent case to pay for the $634 million pension for Chicago public schools, the mayor has also forced cuts and layoffs in sports and also for some teachers.
Another minefield is that he is also asking teachers to pay the full 9 percent of their pension contribution, resulting in a de facto pay cut that has angered the teacher’s union, and will undoubtedly clog the stalled negotiations.
Emanuel has also adopted a bold public presence in the war of words when he said: ““I want Springfield . . . to get off their duff, start providing the political leadership to make decisions to right the decades worth of political wrongs that have existed over the years that got all of us to this point,” the mayor said, pounding the podium for emphasis, according to the Chicago Sun-Times
Behind the very real financial debacle called Chicago is also a game of political posturing that helps feed the frenzy for more, well - posturing. But, the dilemma is how can the schools thrive, and the scores excel, and the teachers not strike --- if the trains don’t run on time while the electorate takes more of a hit to the wallet, can the new Emanuel make the grade with residents?
Perhaps one of the soundest propositions is that “one of the tax hikes would be a “separate levy” of $50 million to bankroll school construction and pay off old projects. CPS has been empowered to impose a “capital improvement tax” for more than 20 years but “never activated” it. Emanuel is expected to take advantage of it,” also reported by the Sun-Times
The two separate tax proposals seem the best way to go -- at this point -- but it’s questionable if the second matter can work: monies “siphoned away from operations to retire school construction debt,” and “based on an untested legal theory that, although CPS is hamstrung by a state-imposed property tax cap, the City Council can authorize an even bigger increase and transfer the money to CPS,” a move that might bring he law of unintended consequences, but that time will only bear out.
Set against the background of the state’s partial shutdown, can the two ever get out of arrears? Gov. Rauner won’t negotiate unless the Democrats say uncle, and the philosophical divide between one that distrust government, and the other that believes that is is a good and necessary thing belies the words compromise, or negotiation.
Meanwhile there is enough name calling and bullying to make both Chicago and Springfield a real donnybrook. The fact remains that despite the hyperbole are high interest loans, junk bond status, a roiling battle with the teachers and a racial and economic divide that wreaks havoc with governance, versus reaction politics.
If Chicago and Illinois politicians only speak in sound bites, Chicago could well become another Detroit. What is there left to prevent that?
One area that is ripe for conversion is Illinois paying for all teacher pensions, except Chicago, that might make pension equality a reality, but again, it’s an unlikely scenario in the current climate. And, “downstate” the euphemism that many Chicagoans use for any place outside of the city limits, are angry and say that “it’s unfair Chicago Public Schools receive hundreds of millions of dollars annually outside the normal school funding formula through what are called block grants.”
So, if Emanuel has to give Lola what Lola wants, Lola being Gov. Rauner, does it begin with a temporary tax freeze? Stay tuned.
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