LIGHTFOOT’S $42.7M PROPERTY TAX HIKE GOES JUST TO PENSIONS

Illinois Policy ^ | 8/12/2022 | Dylan Sharkey

[simpson96]

Chicago is hiking property tax bills by $42.7 million, keeping the city’s long-running tax hike tradition alive as it tries to manage its runaway pension debt.

Mayor Lori Lightfoot chose in 2020 to tie property tax hikes to inflation with a maximum of 5%. After inflation reached a 40-year high, the city will instead use a 2.5% adjustment for tax hikes.

Lightfoot said the increase will cost the owner of a $250,000 home $34 more each year, equating it to extra toppings at lunch.

“To put that in terms that I can understand, that’s about the price of an Al’s Italian Beef – hot, dipped, with extra cheese – for a family of four,” the mayor said, adding, “A $34 increase?… I think people can live with that.”

When you pay extra at lunch, you’re getting something in return. Instead of funding new and improved city services, Chicagoans are paying for unfunded pensions.

Of the city’s $1.7 billion property tax levy in 2022, $1.4 billion was dedicated to pension payments, including 100% of the property tax hike.

“While increasing property taxes is a last resort, the city also needs to be able to keep up with rising pension costs to ensure long-term financial stability and to honor the service of the police, fire, streets and sanitation and other city workers that serve to keep our city safe, clean and running efficiently,” Chief Financial Officer Jennie Huang Bennett said in a press release.

Chicago’s property tax levy more than doubled in the past decade. It’s disingenuous to call something a last resort when you do it every year.

Even after eating up the bulk of property tax dollars, Chicago still holds more pension debt than 45 states. Government pensions have become a black hole for new revenue.

For example, Chicago’s upcoming casino development will exclusively pay for pensions. In the best-case scenario, casino revenue will cover 9% of the city’s pension debt, hardly a solution. Pension reform is the only way to get Chicago out of its crippling debt.

[dznutz]

When a city of Chicago police retiree hits 65 its off to Medicare for them. No free healthcare paid for by the city.

Pension is after working 20 years 50% of salary, and 2.5 percent more for each year they work past 20. To max out at 75% they have to stick around for 29 years and a day for a 30 year pension, which is based on best four years of salary for the previous 10 years.

While working, at least with the police, around ten percent of their pay is put into the pension fund, and the city is supposed to contribute $2 for every one dollar put in. The problem is the city wasn’t putting in their share for many years and the pension fund fell to around 33% funded, in other words, what was in the fund was what the officers had contributed. The Fraternal Order of Police was in bed with the city and didn’t do much to hold the city to their end.

[mewzilla]

Deep State will tax you out of your home to keep the people who purport to be public servants in the style to which they’ve become accustomed.

[Grampa Dave]

Thanks!