By Townhall Chicago News Staff
Mayor Brandon Johnson on Wednesday delivered his fiscal year 2027 budget proposal to the Chicago City Council, a $17.6 billion spending plan that closes an $882.4 million deficit without layoffs or cuts to services.
The proposal, which the administration calls the “Fair Share Budget,” revives a corporate head tax that aldermen rejected last year and proposes new revenue from higher taxes on leased business equipment, sports betting and packaged goods.
The budget includes $131.5 million in new spending. Among the largest items are $30 million for homelessness prevention, a $30.9 million subsidy for Chicago Public Libraries, $7 million for community violence intervention and $24 million to fund a record 40,000 summer youth jobs through Chicago Youth Works, according to the mayor’s press release.
“My 2027 budget ensures every Chicagoan receives their fair share of the investments, services, and opportunities that define our city, funded by responsible spending cuts that protect essential services and by asking wealthy corporations to pay their fair share,” Johnson said during his budget address to the City Council.
The centerpiece revenue measure is the Equitable Employer Tax, which would charge businesses with more than 125 employees $25 per month for each Chicago-based worker. The administration projects the tax would generate $101.8 million. Companies could earn a monthly credit for each employee they hire in historically disinvested neighborhoods through a companion program called the SEED Credit.
The budget also proposes raising the Personal Property Lease Transaction Tax from 15 percent to 20 percent, a move projected to bring in $234 million. Car leases would remain at a flat rate. The Sports Wagering Tax would rise from 10.25 percent to 20 percent, expected to add $37 million.
On the spending side, the proposal makes the Department of Community Wellness and Safety permanent and funds 390 new street outreach workers and 50 Youth Peacekeepers. It also directs $500 million in tax increment financing funds to be made available, with $285 million going to Chicago Public Schools.
The administration identified nearly $120 million in savings from real estate consolidation, fleet modernization and organizational improvements, according to the press release.
“Every year during the Johnson administration, the budget office has undertaken an exhaustive review of each City department’s spending — going line by line, looking for ways to streamline and cut costs without impacts on city services,” Acting Budget Director Jonathan Ernst said in the press release.
Business groups pushed back immediately. A coalition including BOMA/Chicago and the Chicagoland Chamber of Commerce issued a joint statement calling the employer tax “as bad an idea as it was last year.”
“Taxing employers for keeping and adding jobs in Chicago remains as bad an idea as it was last year. City Council rejected it before and should do so again,” the coalition said in its Oct. 21 statement. “A tax on jobs in the name of creating jobs makes no sense — and will stifle growth and our prospects for a more affordable city.”
Chicagoland Chamber of Commerce President Jack Lavin said his organization would mount a campaign to block both the head tax and the proposed cloud tax increase. Ald. Matt O’Shea (19th Ward) called the proposal a repackaged head tax.
“All the mayor’s done here is repackaged it, rename it. This is a head tax, this is a tax on jobs, this is a tax on economic growth,” O’Shea said at City Hall on Wednesday.
The Chicago Teachers Union, meanwhile, praised the budget’s allocation to public schools. CTU President Stacy Davis Gates said in a statement that Johnson “promised to put our students first, and he has delivered by providing over a billion dollars to our school communities over the last four years.”
Davis Gates called on Gov. JB Pritzker and the General Assembly to match the city’s commitment during the veto session, which runs through Dec. 3.
The City Council must approve a final budget by Dec. 31. Budget hearings are expected to begin as early as next week.
