Mayor Lori Lightfoot’s administration announced Thursday that Chicago will forgo a property tax hike connected to the Consumer Price Index for one year due to pressure from municipal leaders and increasing inflation.
Without city action, the city’s property tax was expected to increase by 5 percent, the maximum increase allowed by the city. The Consumer Price Index, to which the tax hike is tied, has grown by more than 8 percent over the past year.
Lightfoot attributes her administration’s decision to forego a property tax increase to the city’s smaller budget ceiling than in past years. According to Lightfoot’s office, there would be a $128 million budget deficit in 2023.
“Because our economy continues to recover faster than anticipated, city revenues continue to exceed our projections,” said Lightfoot in a statement. “As a result, I am pleased to announce that the property tax levy will not increase by the CPI for one year.”
Lightfoot joined the mayor’s office as a proponent of indexing property tax increases to inflation, citing the unexpected and politically motivated nature of previous tax increases.
However, because to the economic repercussions of the COVID-19 epidemic, inflation has skyrocketed during Lightfoot’s tenure as mayor, substantially altering the picture surrounding a significant property tax rise.
“As with anything else I do, I have no regrets,” Lightfoot said. “However, nobody imagined that the CPI would soar as it has this year.” Nobody could have predicted the effects of inflation that we are experiencing this year.
While announcing the tax relief, Lightfoot also addressed the city’s rising pension commitments, a thorny Chicago budget problem for decades.
“Our pension commitments are substantial and will continue to increase in the coming years.
As long as I am mayor, we will never shirk our commitments to our pensioners, who have every right to rely on the pensions they have earned, and we will use all means at our disposal, including the CPI, in future years to pay these obligations “Lightfoot declared.