With a $1.12 billion price range shortfall and $3 billion extra in federal funds on the chopping block, Mayor Brandon Johnson on Monday cracked the door open to the prospect of layoffs and repair cuts that he has beforehand dominated out.
“We should take care of the realities of the billions of {dollars} which can be being threatened by the federal authorities. That’s a special state of affairs than we had been beneath earlier than,” Johnson mentioned as he signed an govt order establishing a working group to advise him on methods to confront town’s fiscal challenges.
“However I’m assured that the collective teams of town of Chicago will stand agency in our values to make sure that we’re investing in individuals — however we additionally must make critical issues primarily based upon the Trump takeover.”
Chicago Federation of Labor President Bob Reiter mentioned he seems to be ahead to collaborating within the working group tasked with producing preliminary findings by Aug. 31 and a ultimate report on Could 31, 2026.
These findings are anticipated to incorporate a mixture of operational efficiencies and progressive revenues that Johnson campaigned on delivering, however have up to now eluded the mayor due to his strained relationship with Gov. JB Pritzker and his anemic observe report in Springfield.
“We’re at all times going to attempt to protect providers to residents, which is what the operate of town is to do,” Reiter mentioned. “Individuals are extra susceptible now than they ever have been. So I don’t ever imagine that chopping jobs or chopping providers is a solution to fight a disaster.”
Reiter mentioned there have been “quite a lot of issues that labor has steered through the years that haven’t been utilized by any administration.”
Reiter was not speaking about eliminating the “sacred cows” of metropolis authorities: three workers on a rubbish truck and the requirement that 5 fireplace division workers be assigned to each piece of fireplace equipment, with the exception of each day “variances.”
“The time period `sacred cow’ is pejorative as a result of we don’t at all times must go after work guidelines, employees’ jobs or service cuts as a way to get monetary savings,” Reiter mentioned.
Ralph Martire, govt director of the Middle for Tax and Finances Accountability, mentioned the structural deficit that Chicago is dealing with has been handed down from administration to administration for many years.
It can’t be resolved “until you will have everybody on the desk and you’ve got every thing on the desk” — and Johnson’s govt order “does exactly that,” mentioned Martire, who attended Monday’s signing ceremony.
“We get the enterprise neighborhood there. We get neighborhood activists. We get labor… We may have the complete alternative to place every thing on the desk, to take a look at what has truly created this structural imbalance for many years and eventually create an opportunity to repair it,” Martire mentioned. “That’s primarily based on the proof, that’s primarily based on greatest practices that avoids the blame sport.”
For 2 years, Johnson has refused to entertain the potential of layoffs or unpaid furlough days for concern it could alienate the unions that put him in workplace.
As an alternative, the mayor who campaigned on a promise to carry the road on property taxes proposed a $300 million property tax improve, solely to have the Metropolis Council unanimously reject a property tax improve of any measurement.
The standoff resulted in a marathon price range stalemate that dragged on till a 27-23 vote mid-December for a price range that hit Chicagoans wallets in different methods — by including an amusement tax on streaming providers; increased taxes on cloud computing, enterprise software program and tools leases and better taxes on parking and downtown congestion.
However the fiscal panorama has modified considerably since final summer time, when Chicago’s three-year monetary forecast anticipated a $1.12 billion shortfall in 2026 and a $1.32 billion hole in 2027.
President Donald Trump has threatened to chop greater than $3 billion in federal funding to Chicago for providers starting from public well being, psychological well being, the atmosphere and schooling to aviation, roads and mass transit.
Trump’s on-again-off-again tariffs might additionally set off a recession and journey slowdown that impacts metropolis revenues.
Final week, a defiant Johnson characterized as “terrorism” Trump’s threats to withhold billions in federal funding from sanctuary cities and lower off funding to highschool districts in Chicago and different main cities that adhere to range, fairness and inclusion insurance policies.
Conspicuously absent from Monday’s signing ceremony was Civic Federation President Joe Ferguson.
Final fall, the Civic Federation laid out a smorgasbord of revenue-raising and cost-cutting choices that included: requiring metropolis workers to take one unpaid break day each two weeks; chopping metropolis executives’ pay by 10% and “lowering and recalibrating” staffing on the Chicago Hearth Division, which now spends 70% of its time responding to requires emergency medical help and solely 30% on fireplace suppression.
