2023 City Budget Hearing [Overview] MORNING

Today we will hear presentations from:
1) Susie Park, Budget Director - Office of Budget and Management
2) Jennie Huang Bennett, Chief Financial Officer
3) Reshma Soni, City Comptroller - Department of Finance

You can stream live here: https://livestream.com/accounts/28669066/events/8800236

We’re waiting for 15 council members to show up for a quorum and we can get started. Presenters will give an overview of the the 2023 budget proposal for their department.

See the budget documents here: https://www.chicago.gov/city/en/depts/obm/provdrs/budget/svcs/2023BudgetDocuments.html

Still waiting on three more council members to join for a quorum.

In these moments I’m truly confused by how City Council members just don’t show up on time — or at all, in many cases.

Like, where are y’all at?? Is there something more important at 9:00am today than how the City’s money will be spent for the next year??

We are finally called to order at 9:26am. Doing a roll call

Ald. Pat Dowell is Chair for the Committee on Budget and Government Operations and is leading the meeting.

First round of questioning is limited to 10 min per Alder, and second round is 5 min per Alder.

Each department has 72 hours or less to submit any information requested through the chair.

There is nobody scheduled for public comment today.

Susie Park, Budget Director for Office of Budget and Management is now presenting.

Park: The budget gap increased to $1.2 Billion in 2021 because of the pandemic

Park: “Now, as we prepare to discuss the 2023 budget, I am in awe at the resilience of this city,”

Park: “With this budget, we will be putting more dollars toward our pension funds”

Park: The proposed gap for this year continues “to focus on community safety and a stable financial recovery” … there are “no new taxes”

Park: The city gathered feedback and input from residents on their priorities and what success looks like to them … the 2023 budget is the City’s “stability” budget

Park’s comments conclude and we’re moving to Jennie Huang Bennett, Chief Financial Officer

Huang Bennett: “After three decades of pursuit of a casino, the City approved a new Chicago casino this year, which will generate $5B of new value to fund police and fire pension funds,”

Huang Bennett: “The city climbed a debt ramp in 2022,”

Huang Bennett: “Because of the debt reduction, the city can fund the largest investment plans in the city’s history … without an increase in our debt load,”

Huang Bennett: “The city has the wear with all to start paying down our pension debt because of a strong Chicago economic recovery,”

Huang Bennett: While our pension accomplishments have been significant, what it really means is we’re meeting minimum payments on our pension credit card.

Now moving to Reshma Soni, City Comptroller for the Department of Finance.

Soni: The clear path program has waived $22 million of ticket debt in just six months

Soni: Enhancements to payment plans that were implemented in 2021 allows motorists more time to put less money down for fees

Soni: This budget includes reforms related to administrative hearing debt

Soni: The UBR home program has allowed homeowners to have $55M forgiven after a year in the program

Ald Mitts and Sposato have joined as members of the committee.

Starting off questions with one from Chair Dowell: Can you define what aging means when doing fund sweeping?

Soni: We’re looking at funds we have established since the inception of the city to see if they can be swept for revenue —for example: landscape deposits that were returned, grant funds that expired before fully being used

Dowell: I noticed a $40M increase for hospital claims, that seems really high — what’s the increase?

Soni: What we’ve seen in the past year due to inflation, the costs are increasing by 10-14% — most of the 70 providers we use are asking for an increase of that much. Lack of staffing, greater needs is driving up the overall cost.

Dowell; You mentioned awarding a contract for a third party administrator — who is that?

Soni; Not chosen yet, in the process of going through that

Starting the questioning with Ald. Michelle Lee, 11th Ward.

Lee: Can you explain the $242M advance pension payment? What will that look like if the market doesn’t recover?

Huang Bennett: That debt outstanding will continue to accrue interest, so advance payments we can make — and the number we’ve calculated here — we expect to save us approx $2B

All from Lee, moving on to Ald. Scott Waguespack, 32nd Ward

Waguespack: What is the outlook on the advanced payment pension from rating agencies / investors?

Huang Bennett: We won’t know for a while, but the contributions we’ve made for the past couple of years has been recognized

Waguespack: What’s the difference between the “more aggressive approach” to TIFFs?

Park: We’re following the same methodology but going through TIF by TIF to see what is a part of a program

Waguespack: The RFP for third-party contractors and consultants — who we’ve heard aren’t getting paid on time — what does this third party do for expediting those payments?

Soni; We’ve been looking at what is causing the delay in house, and working with DPS. From a timing perspective, trying to see how we can get this to flow better between departments + utilizing technology advancements.

Waguespack: What are you targeting with that risk management funding? “We want to see these numbers come down, I think they are — but where are you working on that?”

Soni: We have a risk management division within Finance that manages risk for the entire city. Making sure all contractors have the proper insurance and recovering costs from contractors.

Ald. Harry Osterman, 48th Ward, is now speaking:

Osterman: “It is my strong belief that we should have a department of environments, for many reasons.”

Osterman: “It is only going to get worse. For our City to have a coordinated, robust response to this, it would feel like having a Department of Environment would be the way to go.”

Osterman: Four years ago, the Council created the Department of Housing. Think about what they’ve done in the last few years? “Department of Environment, I think, could do the same thing.”

Osterman: Every community has seen more people experiencing homelessness and with mental health problems … “We are not meeting the moment for what’s going on”

Osterman: “We’re putting a lot of money toward this, but I don’t believe we’re dealing with it in a robust way with city employees that are on the ground, in the communities, helping support these people.”

Osterman: The other part is the shelter system, “I don’t believe we’ve learned a lot from our COVID experience,”

Osterman: “I would like to see, before a final budget vote, a more crystallized, on the ground plan that includes city employees that are doing this, it includes our non profits and includes a more robust shelter system to deal with what we’re dealing with,”

Moving onto Ald. Ariel E Reboyras, 30th ward.

Reboyras: Asks how we’re funding the “immigrants we’re getting on a daily basis today” coming to the City

Park: There’s a grant from FEMA that is now available to us — for shelter, transportation, food and wrap around services + $5M contingency amount the Mayor has set aside

Dowell: Followed up on how much we expect to receive from FEMA

Park: What we’ve requested through the end of this year is about $16M

Ald. Michael Rodriguez, 22nd ward, is now speaking.

Rodriguez: I remember meeting a family at one of the [asylum] centers … “it’s not lost on me that these people are seeking a better life”

Rodriguez: We have a ton of non profits doing the work, at their own costs. I’m curious as to this $5M, what’s that for? Are we thinking of supporting the non profits?

Park: The $5M is really meant to be a contingency, for the city. There’s a lot of conversation around the city becoming an umbrella and we would submit their costs to FEMA for reimbursement.

Rodriguez: “The Latino caucus want to be involved with this and engaged, want to be at the table, but we want to make sure the nonprofits doing the work are also a part of this effort, I couldn’t be more clear on that..”

Rodriguez: “I want a conversation about increased infrastructure spending on the Southwest side of Chicago, the fact is that we’ve got old infrastructure over there that needs repair,”

Ald Timmy Knudsen, new 43 ward Alder, passes on questions.

Ald. David Moore, 17th Ward, is now asking questions:

Moore: On the lack of property tax increase: I’m always reminded when Rahm was supposed to go $800m, then went $500m, and then came back and asked for the $300m — “people can not stabilize their life that way,”

Moore: This $100m for public safety — $36m of it will go to consent decree, which tells me I’m left with $64m

Park: The $100m is additional — “that is brand now”

Moore: Helicopters, what’s the expected cost?

Park: $11m for the two

Dowell: Can you break the $42m facility number down?

Park: $17.2m for maintaining facilities, $10m for fascility upgrades and $15m for joint public safety training academy center

Park: $35m for “replacement of CPD vehicles”

Moore: We have a shortage of police vehicles, we have officers and they cannot get a car. “I need to understand what that net increase is and how that increase is spread across districts,”

Moving to Ald. Silvana Tabares, 23rd ward:

Tabares: What are we doing with the current helicopters?

Park: Better question for CPD

Ald Leslie Hairston of the 5th ward is now asking questions:

Hairston: Last year you had lobbyist activities — what was spent, how many and what activities?

Park: There are two lobbyists working on Springfield items

Hairston: Same for Dues, Subscriptions and Memberships

Park: Generally, Newspaper subscriptions for press office, Mayor dues and memberships

Hairston: For $249,000? Do they pay dues for the law department for administrative hearings?

Hairston: I know she cut some of those for everybody else but she kept them for herself.

Park: So we kept tho —

Hairston: We’ll move on

Park: They replenished —

Hairston: We’ll move on

Hairston: “We need to have a Department of Environment and not another office of five or six people under the mayors office,”

Hairston: How many blue form requests were processed last year? (Requests for increased payment that don’t need city council approval)

Park: Through the chair

Hairston: These are all questions I asked last year

Hairston: When does the city contract with CVS end?

Soni: 2025

Hairston: “What are the plans to look at other pharmacies? Ones that serve the whole city of Chicago, and not just certain neighborhoods,”

Soni: We’ve been working with them to make sure they’re able to offer services. “With CVS, we’ve made it a point with them to say they really need to invest in the community”

Hairston: There are no pharmacies, if you look, on the South and West sides I would say. “They’ve had more than enough time to open up some stores and yet they’ve closed them … in the Black communities,”

Moving onto Ald James Cappleman, 46th ward:

Cappleman: Says he’s heard of a homeless shelter that recently gave a bed to someone who had been there for 20 years, a length of time without assistance he called “borderline fraud”

Cappleman: When residents call 911 about an illegally parked car, it’s my understanding that CPD goes out and tickets. However, when the ward office calls about the same thing — finance goes ticket. Is finance being the only response to this doable?

Soni: That is something weee looking to see how we can “synergize” and we’re looking to see how we can do more enforcement on that

Cappleman: I think people think that the Alderman that screams the loudest gets things done faster, that’s just not true.

Some context (from me!) on this issue: https://blockclubchicago.org/2022/08/18/city-lets-drivers-park-in-bike-lanes-for-days-forcing-cyclists-into-dangerous-situations-they-say/

Cappleman: Is it possible to have contractor/vendor bills processed through the DOF? Would free up time for my staff

Soni: I can work with your office or any office to work on a quicker process with fees, like rent, that are the same every payment

Cappleman: I’m just making a comment, it’s so nice to see all women at the front.

Ald. Carlos Ramirez-Rosa, 35th ward, is now asking questions:

Ramirez-Rosa: How many citywide vacancies do we have currently?

Park: 5,400

Ramirez-Rosa: Re: Line item “for software maintenance and licensing, $8.9m” — is that all for ShotSpotter?

Park: unsure, through the chair

“I’m disappointed to continue to see this in our budget, it’s a waste of public dollars,”

Ramirez-Rosa: “Left and right, criminal court cases are being thrown out that rely on this technology … I really hope we can get that out of our budget and use that money for things that will actually make our community safe,”

Ramirez-Rosa: Does the 2023 proposed budget have any particular funding for the trans community?

Park: I don’t know

Dowell: CDPH, which provides spending for the “LGQBT community” might be able to address that question in more detail

Onto Ald Tom Tunney, 44th ward, is now asking questions:

Tunney: We should take a five year look at rainy day funds, I found out that some was taken away during the pandemic, used, and then replaced. “We should have more than a one year look at things,”

Tunney; “I’ve asked about this before, I’m surprised it wasn’t in your narrative … where are we at with” the funded ratio of pension funds?

Huang Bennett: 24% overall

Tunney: “We really need to look at those pensions, obviously it’s our number one issue”

Tunney: I would like to have a one pager to talk about how we relate to major cities in terms of the amount of debt we’re holding

Ald. Emma Mitts is now asking questions:

Mitts: How many families received cash assistance?

Park: 5,000

Mitts: Where are those families from my ward? I would like to know that. We have no knowledge of how the city is helping.

Mitts: Mental health issues and homelessness run “hand in hand,” … coming out of the pandemic we don’t fix things from before we’re just looking at moving forward, those problems were there before the pandemic and “just have compiled” now.

Mitts: Chicago has a huge problem now, not just mental illness on the street but mental illness in folks like us sitting right here in this room

Mitts: “We legalized marijuana but a lot of them have convictions and we’re not even addressing that,”

Mitts: “We need to do a better job on homelessness. Just looking at the city survey and the homeless coalition survey, I’m wondering who was counting what. The disparity — who were they counting?”

Mitts: “These are the things I’d like to see addressed in the budget, and then I can get around to public safety”

Mitts: “It seems like things aren’t connected, when it comes to a lot of these services… they’re being implemented and we’re spending dollars, but they’re not being connected… That’s when you see the fruits of your labors, when you connect the dots.”

Ald. Nicholas Sposato, 38th ward, now asking questions:

Sposato: Can we set up a foster family program for asylum seekers? What’s wrong with that?

Just a suggestion feeding off comments from colleagues.

Ald Brendan Reilly, 42nd ward, now asking questions:

Reilly; Through the chair, let us know if you plan to eliminate any vacancies

How many non union employees are going to receive salary increases?

Park: We’re looking at a broader study but it’s not yet known.

Reilly: Why aren’t we doing zero based budgeting?

Park: We did that during the pandemic — scratching the things we felt we could cut. There are other costs that are increasing, we’re facing inflation.

Reilly: Under Mayor Daley, Mayor’s office had 60 or so staff and now there’s 127 … 16 people in press office, I think Daley had 4. Why so many people in press?

Park: There’s a director, digital media, a photographer — we will lay out the mission of each section through chair

Reilly: What purpose does an office under the mayor serve then there’s another department doing the same work?

Park: The mayors office brings the work together citywide, there are a lot of citywide investments that are coordinated through the mayors office

Reilly: You’ve got 66 people doing policy … “it just seems like a lot of people in the Mayor’s office and other Mayors have made it work with less”

Reilly: Advocating for “consolidated invoices” … why can’t we reconcile this and get folks one invoice, one time a year so they have predictability in what they owe to the city? “Why can’t we get this straight?”

Now moving onto Ald Marty Quinn, 13th ward:

Quinn: What is the total number of blue shirt officers?

Park: 8729

Quinn: So at best we will stay there?

Park: We will have to see what the attrition is

Quinn: Last year we talked about incentivizing officers to stay, one thing that strikes me is advertising in Cicero for police officers. Starts at $90k, you don’t have to live there — how do we compete?

Quinn: What’re we doing to prevent losing officers we spend money to train?

Park; Investments, Police upgrades, facilities, parental leave

Quinn: The $100M as a part of Mayors budget — is part of that license plate reading?

Park: No

Quinn: So if we want a reader, it has to come out of menu?

Park: No, we have $5m budgeted for cameras and license plate readers in addition to menu funding

Quinn: Concrete cost will go up at least 10% next year — will there be increases in menu?

Park: that’s something we can look at

Huang Bennett: We have the wear with all to continue on in future years without the federal funding layered on in our corporate fund

Quinn: What’s the plan for the 2% revenue from sports betting?

Huang Bennett: It’s not a significant amount of money

Quinn: What did Niel Bloom say? We’re gonna lose $11-12m?

Huang Bennett: Sports betting is a very small portion of casino revenues, I seem to recall it was about $2m

The committee is now going into an hour long lunch. We will resume at 1:15pm.

I’m gonna start a new thread for the afternoon portion of the hearing — it’ll be linked below shortly!