Your Taxes Are About To Get Little Higher: City Approves New Water, Sewer Tax
By Sarah Gouda in News on Sep 14, 2016 7:44PM
City Hall, via senor codo/Flickr
Sometimes our love for Chicago can feel a bit unrequited. Take, for example, when a CTA bus blows past you despite your flailing arms and piercing, blood-curdling screams. Or the moment when the City Council approved Rahm's new water and sewer tax, as it did on Wednesday morning.
In an effort to sprinkle baking soda over the raging grease fire that is this city's finances, Mayor Rahm Emanuel pushed for the tax as a necessary step in preventing Chicago's four pension funds from going broke within the next decade. The 40-10 vote means homeowners' pocketbooks will be $53 sadder next year and $226 sadder by 2020. This is an increase to Emanuel's successful first-term push to double water and sewer tax bills.
The Tribune reports that Emanuel spoke to aldermen after the vote, stating "Now, nobody likes to raise taxes, but everybody likes to make sure they have a secure retirement. And the actions here, while politically important and politically courageous, may not be popular, but we did say we were going to do the hard things and the necessary things to finally fix Chicago's fiscal picture."
Emanuel reasserted that despite the tax increase, Chicago's water and sewer rates are still lower than those in the 104 of 126 suburbs that purchase their water from the city. Once fully phased out, the new tax is expected to contribute $239 million per year to the Municipal Employees' Annuity and Benefit Fund. For those keeping track at home, the city owes the fund $18.6 billion. That's in addition to the money the city owes the three pension funds for police officers, firefighters, and laborers. These numbers are, um, intimidating to say the least.
To make a dent in this titanium-grade debt, Emanuel is also sourcing funds from existing revenue sources such as airport fees. Despite such efforts, the city still has a long way to go in fulfilling Emanuel's promise to reduce debt to the municipal fund to just 10 percent over the next 40 years.
The city has sought out further revenue for the police and firefighter funds through annual property tax increases, approved last year and set to phase out over the next four years. It's also increased the emergency services taxes on landline and cellphone bills addressed to city residents by about $17. This money is intended to feed into the laborers fund.