A majority of the City Council’s 50 members, including the Black Caucus chair and several members of Mayor Brandon Johnson’s leadership team, are declaring their opposition to his proposed, $21 a month per-employee head tax and urging Johnson to find a $100 million a year replacement.
Finance Committee Chair Pat Dowell (3rd), Rules Chair Michelle Harris (8th), Transportation Chair Greg Mitchell (7th) and Black Caucus Chair Stephanie Coleman (16th) are among the 27 Council members who signed the letter in an apparent attempt to kill one the most controversial elements of Johnson’s $600 million plan to, as he put it, “challenge the ultra-rich” and corporations to “pay their fair share.”
“We are gravely concerned that reinstating the head tax would discourage hiring, push employers outside city limits and make Chicago less competitive,” the letter states. “We ask your administration to model alternative budget scenarios that exclude this jobs tax.”
The letter states similar concerns about Johnson’s “reliance on borrowing for operating expenses, particularly the use of debt to fund firefighter back pay” and repay that $166 million over a three-year period.
“We believe such practices undermine long-term fiscal stability,” the letter states.
Noting that the city spent $3 million on a cost-cutting report by the accounting firm Ernst & Young, the letter demands that representatives of the accounting giant testify before the Budget committee “to explain which recommendations were adopted and why others were not.”
Ald. Walter R. Burnett (27th), recently appointed by the mayor to succeed his father, former City Council dean Walter Burnett, signed the letter — only to later ask that his name be removed.
“I just think there’s ways to be more collaborative… I just want to be in the Burnett lane and continue to do the diligent work,” the new alderman said. “The head tax could be something that we can do if it turns out, after we do all the work, that that’s an effective way to generate all of the revenue that we need. But I still want to look at all of the options.”
Business lobbyists who circulated the letter initially claimed to have Pedestrian and Traffic Safety Committee Chair Daniel LaSpata (1st) on board. But LaSpata told the Sun-Times the group was mistaken.
“I was forwarded a letter and asked if I would sign on to it. But looking at it now, I never signed on to this letter,” LaSpata said. “I have concerns about how [the head tax is] currently structured, but I haven’t made up my mind about it.”
Dowell, who has had her differences with Johnson, refused to explain her decision to sign the letter.
“I will have no further comment. The letter is self-explanatory and my signature is evident. My understanding is that the letter is public,” Dowell wrote in a text message to the Sun-Times.
Last year, the City Council unanimously rejected Johnson’s proposed $300 million property tax increase and refused to raise property taxes by any amount. That forced the mayor to cobble together a $165.5 million package of taxes and fees, including installation of 50 additional speed cameras.
The protracted budget stalemate finally ended with a 27 to 23 vote that saw veteran aldermen admonish the mayor for a series of budget missteps, creating deep mistrust between the embattled mayor and an emboldened City Council.
The letter asking the mayor to find a head tax replacement does not rise to that level of rebellion. But it is a signal that Johnson has work to do to salvage a major element of his progressive tax package.
The Chicagoland Chamber of Commerce, whose lobbyists helped circulate the letter, has denounced the head tax as a “job killer.” Gov. JB Pritzker has joined them in their criticism of the tax that former Mayor Rahm Emanuel phased out in 2014 at a level more than five times lower than Johnson’s proposal.
“We just heard about it this morning and the first call we made [to Burnett], they immediately took their name off of it. So, we don’t think these people are rock-solid,” said mayoral press secretary Cassio Mendoza. “The head tax is not dead. Don’t even put that out there. Is there opposition to it? Yeah. Of course. But, we’re gonna work through it.”
Mendoza challenged the 27 alderpersons who signed the letter to answer a fundamental question: “Do you want to cut the $100 million of programs that are part of the fund” earmarked for community violence intervention, youth jobs and recreational programs?
Aviation Committee Chair Matt O’Shea (19th) signed the letter and helped business lobbyists gather signatures. He said more than 30 alderpersons oppose the head tax, but some were unwilling to sign the letter “for whatever reason.”
“We’re exercising our independence and our oversight responsibilities… We can’t rely on one-time fixes and stop-gap measures,” O’Shea said.