Chicago aldermen began detailed budget hearings Monday amid skepticism over Mayor Brandon Johnson’s $17.6 billion spending plan, signaling a contentious approval process ahead. The City Council launched a 10-day review starting with a scrutiny of the mayor’s fiscal proposals, with several aldermen questioning the viability and assumptions underpinning the budget.
At the outset, Alderman Anthony Beale of the 9th Ward challenged the city’s top financial officials, including Budget Director Jonathan Ernst, Chief Financial Officer Ashlee Gabrysch, and Comptroller Michael Belsky, on whether the proposal constitutes a balanced budget. Beale’s tone, shared by numerous council members, reflected deep doubts about the plan’s revenue forecasts and expense projections.
Ernst defended the budget as balanced, emphasizing prudent revenue sources and spending adjustments aimed at closing the budget gap responsibly. He cited “sound revenue and expenditure projections” and organizational improvements, alongside what he described as structurally sustainable revenue solutions.
However, aldermen voiced resistance to key elements, including a reinstated head tax on businesses, expected to generate over $100 million despite widespread opposition expressed by council members last year. Ernst attributed the tax proposal to feedback indicating the public believes large businesses are undertaxed, though Alderman Brendan Reilly of the 42nd Ward criticized the basis for that feedback as biased, questioning whether it stemmed from genuine public input or internal “budget echo chambers.”
Another point of contention involves Johnson’s plan to issue $480 million in bonds to cover police misconduct settlements, mainly for already settled cases. CFO Gabrysch assured lawmakers the debt would be managed responsibly with repayment over five to seven years, noting interest costs of approximately $190 million by 2027. Concerns remain over how such borrowing might affect Chicago’s credit rating, which is close to “junk” status, potentially increasing future borrowing costs.
Industry analysts have expressed reservations about the borrowing strategy, focusing on the city’s reliance on new revenues rather than structural reductions. Scott Nees, an S&P ratings analyst, recently highlighted risks associated with covering operating expenses through debt and the lack of substantial cuts in Johnson’s approach. Comptroller Belsky countered by emphasizing Johnson’s record on achieving nearly $900 million in spending efficiencies and framing settlement expenses as temporary, not ongoing operational costs.
Additional proposed revenue measures under scrutiny include a 15-cent tax on delivery bags, such as those used by Amazon, and allocating $75 million from proceeds of the city’s parking meter sale toward pension payments. These and other issues may require City Hall to reconsider cuts or new revenue streams as state-level proposals are pursued.
Johnson’s legislative affairs director, John Arena, recently outlined potential state-approved tax initiatives, including a 1% payroll expense tax targeting employers with substantial payrolls, a 5% occupation tax on ticket resale platforms and permanent seat licenses, and a $1 fee per delivery order. Arena suggested these could generate significant new revenue, but none are currently reflected in the 2027 budget proposal.
The question of how much of Johnson’s budget fixes are structural versus one-time measures has also drawn aldermanic criticism. CFO Gabrysch, who previously worked as a Fitch Ratings analyst, stated the budget is about 56% structural when accounting for the police settlement borrowing plan, contrary to Johnson’s claim of 76%. Alderman Marty Quinn of the 13th Ward was blunt in his response, accusing the mayor of being “a little disingenuous” regarding the budget’s composition.
As the council’s examination of individual departments continues over the next week and a half, tensions suggest Johnson faces significant hurdles in securing the votes needed to pass his budget unchanged.