Please closely read this fine article and enjoy our massive tax increases. What the article forgot to mention was the massive amount of no-bid contracts to contractors assisting in repairs and service-work. One Union official bragged about his son-in-law making a “Killing” in overtime. Read the article below. Fran Spielman is an outstanding journalist. Patrick McDonough.
]]>Is Daley setting stage for tax hike?
CITY HALL | Budget crunch forces 2nd round of cuts
July 27, 2007
BY FRAN SPIELMAN City Hall Reporter email@example.com
Mayor Daley appears to be laying the groundwork for a post-election tax increase — by ordering a second round of midyear spending cuts to ease a budget crunch tied to the housing slump.
Thursday’s 2 percent, across-the-board cut in non-personnel spending comes as year-end audits show Chicago closed the books on 2006 with just $26.8 million in the bank. That’s less than half the $57.6 million it had the year before.
“It’s not a particularly pretty sign, and it’s not what we want. We want our reserves to go up. But, it’s reality. … The housing market is in a slump,” said Budget Director Bennett J. Johnson III.
Chief Financial Officer Paul Volpe was asked whether Chicagoans should brace for a post-election tax hike.
“We always turn to management improvements first, but at this point, nothing is off the table. ..,” he said.
Two months ago, Daley cut spending by $10 million — by ordering 3,250 city managers to take one unpaid furlough day, cutting off non-emergency overtime and suspending hiring unrelated to public safety.
This time, the mayor hopes to save $6 million by sparing no city department from the 2 percent cut.
Daley breezed to re-election on a budget that froze the city’s property tax levy for a third straight year and held the line on all other taxes and fees.
But that was before a February cold snap billed as the worst in 28 years caused water mains to break, pipes to freeze and the overtime budget to bust.
February overtime for the Department of Water Management alone was $5.7 million, compared with $750,000 the year before. Three February storms cost the Streets and Sanitation Department $4.4 million in February overtime, triple last year’s spending.
At the same time overtime costs were going through the roof, the housing market was hitting a wall, depressing related revenues even as taxes on sales, amusements and hotels continued strong growth.
The bad news Chicagoans have come to expect after elections is certain to get even worse next week, when Daley unveils a preliminary 2008 budget with a shortfall in the $100 million-to-$150 million range.