Didnt see this coming at all. Only thing is now, Rahm has to come up with the pension money every week no matter what. Business bad? Fuck you, pay me. Oh, you had a fire? Fuck you, pay me. The place got hit by lightning, huh? Fuck you, pay me.

Mayor Rahm Emanuel is set to call for the largest property tax increase in modern Chicago history to raise enough money to make a major pension payment for police and firefighters next year, the mayor's City Council floor leader and a City Hall source told the Chicago Tribune late Wednesday.

The mayor also plans to push a new garbage collection tax, a new per-ride fee on taxis and ride-hailing services such as Uber and a new tax on electronic cigarettes and smokeless tobacco products.


Ald. Patrick O'Connor, 40th, said the idea is to cut down on the annual budget hole that has plagued the city budget for years and further scale back some of the poor financial practices. That includes scoop-and-toss borrowing, in which the city takes debt that's coming due and kicks it out into the future at a higher cost. The administration also wants to put the police and fire pension systems on a road to solvency, he added.



The mayor is considering a property tax hike of between $450 million and $550 million for police and fire pensions, but he has yet to settle on a final number, a City Hall source said. O'Connor put the figure at $450 million for police and fire pensions, plus another $50 million for a Chicago Public Schools construction program. Aldermen would authorize the CPS property tax increase, and the Chicago Board of Education would approve it.

Chicagoans also would be set to join the residents of many suburbs in paying a garbage hauling fee. O'Connor put the garbage tax at $10 to $12 a month for single-family homes and two-flats. The veteran alderman said the tax would not cover the entire cost of garbage pickup, but would put a pretty good dent in it.


Fewer details were available on the e-cigarette tax and new taxi and ride-hailing fees. Ald. Edward Burke, 14th, previously had proposed a $1-per-ride fee on rides from taxis and companies such as Uber and Lyft. Emanuel alluded to that proposal this week when he was asked whether such a tax could be included in the budget he'll unveil Sept. 22.

"There's still a lot of pieces in motion here," O'Connor said.

During his first term, Emanuel avoided major tax hikes in favor of a series of smaller tax, fee and fine increases that together resulted in the equivalent of a 60 percent increase in city property taxes for the average homeowner. Still, come re-election time this year, Emanuel was able to tell voters he hadn't raised property, sales or gas taxes during his tenure.




Emanuel, however, did not set aside money for a major increase in police and fire pension payments that has been looming over City Hall since the General Assembly approved a state law when Mayor Richard M. Daley was in charge. Now the bill is due.

Pension payments this year total about $478 million. Next year, payments to police and fire pension funds will increase by $538 million under current state law, although Emanuel is hoping Gov. Bruce Rauner signs a bill that would allow the city to phase in the higher payments more gradually. Lawmakers approved that bill at the end of May, but have yet to send it to Rauner amid a broader stalemate at the Capitol.


The property tax increase Emanuel is mulling would far exceed what the mayor himself said during the campaign was the largest property tax increase in Chicago history. In 1987, under Mayor Harold Washington, property taxes rose by $79.9 million, which would be $167.8 million in today's dollars after adjusting for inflation. In 2008, under Daley, property taxes increased by $86.5 million, or $96 million in today's dollars.

During the campaign, Emanuel attacked his runoff challenger, Jesus "Chuy" Garcia, for voting for the Washington-era property tax hike. Now Emanuel is weighing a property tax hike that could triple the one his opponent backed.

For weeks, Emanuel has held a series of closed-door meetings with top aides to determine how to come up with enough money to make good on the city's pension commitments while also working to scale back the city's most expensive borrowing practices. Many aldermen have long suspected a major property tax increase would be a big part of the answer.

"It's not as if we weren't warned," said Ald. Joe Moore, 49th. "We have known for several years that the pension shortfall was going to cause us to make some really painful decisions, particularly if we didn't receive any relief from Springfield, and we didn't receive any relief from Springfield."

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Proud member of the white guy grievance committee

It aint the six minutes. Its what happens in those six minutes.

CHUY

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Rahm is still trying to figure out another way to make suburbia help foot the bill.

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Still a better plan than CHUY had I guess.

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Proud member of the white guy grievance committee

It aint the six minutes. Its what happens in those six minutes.

CHUY. Should've elected the LATIN. Instead we get Rahm and his IDIOT FRIENDS.

When you blindly vote for the same people for decades, this shit will happen.


"They too shall pay"

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Only the beginning of the pension induced shortfalls that will plague IL for the entire 21st Century. I can't blame Rahm as those promises were made by prior administrations. When your plans are 40% funded, you have real problems.

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Hawaii (fuck) You

Mr. Tough Guy looked a little frightened as he was getting bumrushed by a bunch of Big Black Studs on a hunger strike. Good thing that tough New York cop was there to proetct the Tiny Dancer.

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Freedom is our Strength.

How much of a band aid is that 500 million ? Whats that buy, a years worth of payments? Then another 500 million due?

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Proud member of the white guy grievance committee

It aint the six minutes. Its what happens in those six minutes.

Large cities like Chicago should be able to be pretty much self-sustaining with minimal, if any, help from feds/states/counties.

Chicago needs someone who can figure that out.

Word has it he was on the phone with his sons high school guidance counselor when they rushed they stage.

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Proud member of the white guy grievance committee

It aint the six minutes. Its what happens in those six minutes.

Shots fired!!!!

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520 plus comments on the article on the Trib website. Ive never seen that many for one article. People fucking hate paying union pensions.

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Proud member of the white guy grievance committee

It aint the six minutes. Its what happens in those six minutes.

A very small band aid. There is no way to mitigate pension promises in IL. I am wholly on board with paying for past promises as those employees deserve what was earned. But since the courts have ruled that you can't change benefits on a going forward basis for existing employees and retirees, those costs are going to continue to compound. These schemes work well when you have a young and growing population/workforce. They fail as employees get older and the population is no longer growing. Of course, required contributions were missed along the way making the problem much bigger than it should be.

It is my expectation that Chicago will eventually file bankruptcy like Detroit. It is my understanding that the state has to approve a Federal bankruptcy filing pursuant to IL law. I am not sure how that would work out politically, because Federal Courts allowed Detroit to reduce pension promises.

It is going to be ugly. I have read Chicago's audited financial statements several times, and it makes me sick to see the poor financial condition of the pensions.

http://www.cityofchicago.org/content/da ... R_2014.pdf

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Hawaii (fuck) You

Can't change it for existing employees, but you can for new employees. And they haven't.

b/c they're political handouts

Here are the key numbers. The funded ratio is the big issue. Plans below 80% are in trouble per ERISA/DOL guidelines.

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Hawaii (fuck) You

They all could have paid Social Security and eventually arrived at the same place.

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If Springfield isn't going to take care of this for us then we should leave Illinois. There is no reason for us to pay state taxes in Chicago/Cook Co when they refuse to take care of our problems with that money. This whole state would be in the Stone Age without Chicago.

The state has abandoned the CTA.
The state gives fuck all about CPS.
The state's response to the pension crisis? "lol I dunno"

3% of our incomes and 4% of our purchases are just shipped down I-55 never to be seen again. I'm tired of paying these taxes to support red-state meth addict downstate hicks who think theyd even have running water without Chicago. Let Illinois rot. Long Live the 51st State, Chicago.

I think most people in Illinois would be okay with that.

Since most pension plans are assuming 8%+ investment returns, the Fed will never raise rates -- the stock market must be propped up at any cost or else these pension programs are blown to smithereens (more than they already are).

It's all a Ponzi scheme. As Big Chicagoan stated, they haven't even fixed the system for new employees, which is unconscionable.

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But Rauner wants everyones pension to be a 401k, only if you don't do well its tough shit for you then. Of course , not everyone has access to insider info and the ability to cut million dollar sweetheart deals like he can either.

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Proud member of the white guy grievance committee

It aint the six minutes. Its what happens in those six minutes.

I thought Quinn passed two pension bills. One was overruled, but the other smaller bill did make changes for new employees. I tried to Google it, the search kept funding the one that was overruled. Maybe I am mistaken......

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Hawaii (fuck) You

Chuy was right.

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Be well

GO BEARS!!!

New employees should have a 401K. Obviously nothing they can do about existing employees at this point accept shut up and pay. In 70 years, everyone will be on 401K.

Yes. That's all any of the prior actions were for and continue to be. It's all for the stock market. If that includes looting from savings and condemning retiree's or those close to retirement to eat from dumpsters, well, so be it.

And the whole interest payment service on federal debt would end it all...

There will never be another appreciable interest rate hike in our lifetimes. This is speeding fast towards a collapse. Muni first then federal level.

Banks and the big players will absolutely love that.

Another honey pot.

But that really is the only fair solution.

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Makes everyone complicit in driving down their own wage while trying to save for retirement.

The rich get richer while the poor get poorer.

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I am a huge advocate for limited government. But for those that want lots of government benefits for social programs and government employees, the only thing I ask is that you support all taxes necessary to cover those costs. This goes for Republicans who want us to police the world and "invest" in military spending. It is absurd that folks complain about taxes, while at the same time complaining about government spending cuts or spending deficiencies.

The two sides of the ledger must balance over time.

That is why I support Rahm's tax increase. He didn't create the problem, but he needs to find the funds to pay for it.

I have watched this play out in my own town, which is a much smaller scale. They balance their budget every year. They have cut back on staff. When they finally needed to raise taxes they asked residents which would be most acceptable. They ended up raising the gas tax in the village. They have also boosted water rates. They added a new tax to our utility bills. We still do not pay for garbage collection or have any car stickers, which were some of the other ideas.

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Hawaii (fuck) You