The city council of Chicago has recently approved the $7.8 billion fiscal 2016 budget and a historic property tax increase to pay for public safety worker pensions, as proposed by Chicago City Mayor Rahm Emanuel.
"The city council today took a big step forward in providing more stability and more certainty and a strong financial footing for the city going forward," said Mayor Emmanuel.
New York Times reported that the proposed property hike made it through the city council with 36-14 votes favoring for the property hike. Even with seemingly a high number of supporters, many aldermen said that the property tax hike is their last resort.
"None of this is easy," said South Side Alderwoman Carrie Austin who voted in favor. "Absolutely none of it."
"This is the equivalent of a municipal illness," said Alderman Patrick O'Connor. "We don't have the option of saying no. We have the option of picking our choices for staying alive."
The proposed increase in property tax and other city revenues will take effect over four years to cover the state-mandated contribution increases to police and firefighter pensions.
According to Reuters, if Republican Gov. Bruce Rauner does not enact a state law that will spread out annual contributions, the tax increase will only fall short. Mayor Emmanuel also wants to push through the state legislature for a bill to shield residential properties valued at $250,000 or less from the tax hike. The city council is also considering a rebate program if that measure is not enacted. This program could cut homeowners' reimbursement checks.
Realty Today reported in the past that the 60 percent increase in the city's property tax levy, along with a garbage fee, ride-hailing surcharge and smokeless tobacco tax, will be used to allocate the $30 billion unfunded police and fire pension debt, and the $9.5 billion pension crisis at the Chicago Public Schools.
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