Chicago Mayor Brandon Johnson proposed a $17.6 billion budget on Wednesday that relies on $664 million in additional revenue and $120 million in spending cuts to close an $882 million budget deficit. Released during an address at packed City Council chambers, the spending plan—dubbed “Chicago’s Fair Share”—includes a controversial corporate head tax, a 15-cent package delivery tax, and increased fees on sports betting and leased software, while directing $131.5 million toward expanded neighborhood services, mental healthcare, and youth programs.
Closing the Budget Deficit Through New Taxes and Borrowing
To bridge the financial gap, Johnson’s administration is proposing a corporate head tax charging businesses with at least 125 full-time-equivalent employees $25 per employee each month, a levy that would affect roughly 2.8 percent of Chicago businesses according to the Mayor’s Office. Additional revenue streams include raising the Personal Property Lease Transaction Tax to 20 percent, which Ald. Nicole Lee (11th) noted runs counter to a provision adopted during last year’s negotiations to keep the tax at 15 percent until 2028. The package also features a 20 percent tax on sports betting and a new 15-cent tax on delivered packages designed to curb online shopping waste.
Did You Know? Mayor Brandon Johnson’s “Chicago’s Fair Share” budget echoes the title of a 1986 spending plan introduced by former Chicago Mayor Harold Washington, as reported by the Chicago Tribune.
NEW: We have the key details about Mayor Brandon Johnson's Chicago budget proposal. Another corporate head tax, with rebates in poorer areas. Borrowing $480 million to pay for police lawsuits. A PPLT tax hike to net $234 million. More in @chicagotribune: https://t.co/ykhbPnmVos
To handle decades-old financial liabilities, the administration is seeking City Council approval for $480 million in short-term borrowing authority to cover police misconduct settlements. This includes $260 million for a global settlement tied to former Chicago Police Detective Reynaldo Guevara, with Chief Financial Officer Ashlee Gabrysch stating the debt will be paid off over five to seven years.
City allocates funds for quality crews and cuts vacancies
The spending plan allocates funds to double the number of quality-of-life crews handling illegal dumping and overgrown vegetation, while adding 10 forestry crews and five rodent control crews to combat rat infestations. Acting Budget Director Jonathan Ernst stated that personnel savings of $34.4 million will come from eliminating and freezing vacant positions across city departments, including 368 unfilled police officer positions and 11 sergeant vacancies confirmed by the mayor’s press office.
https://t.co/eDZ1Fu9V56
Other investments in the budget feature nearly $31 million for Chicago Public Libraries, $24 million for youth employment, $7 million for violence prevention, and the expansion of the Crisis Assistance Response and Engagement program to operate seven days a week. The administration also plans to open a new mental health clinic in 2027.
City Council Pushback and the Road to December 31
The budget immediately drew sharp opposition from a 29-member coalition of alders who opposed the return of the corporate head tax and the lease tax increase, calling the proposal tone-deaf and lacking collaboration. Downtown Ald. Brendan Reilly (42nd) argued that the council should work together to pass a responsible budget, while Ald. With the legal deadline to pass a balanced budget falling on December 31, several alders anticipate a tense legislative showdown as negotiations unfold.
Mayor Johnson proposes Chicago budget to close deficit
What is the size of Chicago’s proposed budget for 2027?
Mayor Brandon Johnson is proposing a $17.6 billion budget that calls for $664 million in additional revenue, $131.5 million in new investments, and nearly $120 million in cuts to close an $882 million deficit.
How does the proposed corporate head tax work?
The revived corporate head tax would charge businesses with at least 125 full-time-equivalent employees $25 per employee each month, affecting about 2.8 percent of Chicago businesses while offering tax credits for offices located on the South and West sides.
I spoke with Chicagoans of all ages from neighborhoods across the City about our budget and heard a continuous refrain: after receiving billions in tax breaks from Donald Trump, it's time we ask large corporations to pay their fair share. pic.twitter.com/H6FMyYycFg
What are the key nonstarters raised by city alders against the budget?
A 29-member council coalition previously sent a letter outlining three nonstarters, objecting strongly to the corporate head tax and the increased tax on leased software and computer equipment while noting that the current proposal does not contain a property tax hike.
How will the City Council and the mayor reconcile their disagreements over the corporate head tax and borrowing authority before the legal December 31 deadline?
Two aldermen Mayor Brandon Johnson shouted in his budget address despite them breaking from him a year ago and voting with the council opposition: Alds. Ronnie Mosley and Desmon Yancy. In total, nine progressive alders and counting were commended in the mayor's speech
More on Brandon Johnson
Keep reading
- Australia and Indonesia Conclude Exercise Keris Woomera
- Cholakovgate Leaks Expose Corruption Inside Bulgaria Supreme Court
- North Dakota Lawmaker Proposes Bill to Regulate Data Center Power, Water, and Decommissioning (news-usa.today)
- Tuesday's French Budget Vote Is Not the Cliff. The Calendar After It Is (daybreakwire.com)