What Chicago’s new budget plan means for homeowners and housing

Lightfoot passed the 2020 budget with only one property tax increase. The hike on Chicago Public Library property taxes will create an additional $18 million and help keep them open 7 days a week.

Many residents feared a property tax increase similar to what happened under former Mayor Rahm Emanuel. In 2015, the budget included a historic property tax increase, one of the largest in the country, that was expected in bring in $543 million over four years.

This time, Mayor Lightfoot was able celebrate the budget passing. But, some aldermen were weary that a larger property tax might be down the road. At the City Council meeting, Alderman Beale (9th Ward) said parts of the budget were “filled with smoke and mirrors,” according to the Chicago Sun-Times.

The mayor is banking on savings from debt restructuring, and a few other plans that need federal approval. She hoped that state legislators would green light a progressive real estate transfer tax, but lawmakers left the session without making a decision.

In a special address about the initial budget plan, Lightfoot said “These new sources are rooted in progressive economic, financial, and social policy. They include reforming Chicago’s ‘real estate transfer tax’ which is a tax that applies to anyone selling or buying a home,” Lightfoot said. “This is exactly the kind of policy we want to be doing here. Policy that is fiscally sound, and also helps our communities grow.”

The city predicted that real estate transfer tax would generate an additional $125.6 million in 2020. The mayor will need this revenue to make the budget work and is hoping to get it passed in the spring legislative session.

The budget also allocates additional resources for homelessness prevention programs and the construction of affordable housing. Lightfoot directly addressed developers during her budget speech asking them to “step up in partnership to help us meet this crisis head-on.”

A new Utility Billing Relief program in the budget will help 20,000 low-income households, according to the mayor’s office. No more water shut-offs, no debt collection agencies, and financial help with water bills. As part of the program, the city will bill for water monthly rather than twice a year.