City Council reacts to progressive groups' $12 billion financial proposal - Action Center on Race and the Economy

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A proposal to raise billions of dollars by taxing businesses and higher-income Chicago residents, released just three days into Mayor Brandon Johnson’s new term, spotlights what’s expected to be a tension point for the new mayor, as progressive allies who helped him win office seek to push him to the left, beyond the ground his administration has staked out.

The Action Center on Race & the Economy and the People’s Unity Platform released a report yesterday outlining a proposal to create $12 billion through progressive taxes and spending cuts, including a city income tax, a wealth tax and eliminating vacancies in the Chicago Police Department, followed by annual spending cuts to the police department’s $1.9 billion budget.

Johnson’s campaign manager and senior adviser to his transition, Jason Lee, told Crain’s yesterday that Johnson was not involved in creating the report and rejected many of the proposals during his campaign. 

“Some of the revenue ideas they listed line up with the agenda that the mayor ran on, some of them don’t, most notably the city income tax. I’m not supportive of a city income tax; this administration is not supportive of city income tax,” Ramirez Rosa said.

“Does it help to be able to say, ‘Look, there’s an even bigger, more ambitious plan’? Absolutely. But I think at the end of the day, people are going to weigh the merits of each proposal individually,” he said.

Ald. Brian Hopkins, 2nd, who endorsed Johnson’s opponent, Paul Vallas, in the runoff election, said, “Not a single one of those proposals would gain 26 votes if the vote were held today.”

While Hopkins argued that the report did Johnson a “disservice” as he builds relationships on the City Council, he said it could provide leverage for the new mayor to get buy-in from moderate aldermen who fear sweeping policy changes coming from the left.

“We all know that the coalition that supported him and got him elected has some extreme demands,” Hopkins said. “They worked hard to get Brandon Johnson elected mayor, so they’re going to push for their full agenda.”

Johnson was elected to the fifth floor by a large-tent movement that spent more than a decade mobilizing against City Hall and has no plans to step down now that one of their own is in office. Johnson has said he’ll welcome those community organizers to the negotiating table, even as he is seeking inroads with business leaders and others who opposed him.

Ald. Andre Vasquez, 40th, said it’s “healthy” to have the movement push a conversation forward even if it’s “not the most comfortable being on the receiving end” when disagreeing on policy or what’s possible to get through the City Council.

Vasquez, who considers himself a democratic socialist and backed Johnson in the runoff, was censured by the Chicago chapter of the Democratic Socialists of America for voting “yes” on former Mayor Lori Lightfoot’s 2021 budget. At the time, Vasquez said the compromises he helped secure in the budget necessitated his vote.

“We need to really do a good job of informing our movement folks of all the particulars as to how (legislating) works,” he said. “To say we totally agree on our north stars, but we also have to navigate the existing waters to get there.”

While it’s expected that Johnson will have to make compromises with more moderate aldermen to see any of his tax proposals approved, he will continue to feel pressure from close allies who have long called to shift the city’s tax burden from property taxes to corporations and wealthy individuals.

Another democratic socialist close to Johnson and the Chicago Teachers Union, Ald. Byron Sigcho Lopez, 25th, said the report and its proposed taxes is a “fair consideration,” because “the problem with corporations is they don’t want any compromise.”

“They have a lot of money to play in politics but not enough money to pay their fair share,” he said, pointing to Citadel founder Ken Griffin, who spent $54 million to help defeat the state’s progressive income tax proposal in 2020, “so now we have to find alternatives.”

Sigcho Lopez, who is set to chair the City Council Housing Committee if Johnson’s overhaul of the council leadership structure is approved next week, also pointed to the changes to the city’s affordable-housing ordinance under former Mayor Lori Lightfoot, which doubled the number of affordable units in most developments.

“There was doomsday from developers,” he said. “But now all of a sudden, everyone is praising the increase.”

While Johnson’s corporate head tax calls for large companies to pay $4 per employee, in an effort to generate $20 million, the groups’ proposal calls for a $33-per-employee tax on companies with more than 50 employees, bringing in $106 million annually. 

Sigcho Lopez said that $86 million difference “creates room” for negotiations on the council. The Pilsen alderman said he anticipates more legislative debate this term and that Johnson will be more receptive to ideas that don’t originate from his office.

“In a functioning democracy, I think it’s healthy to have more ideas, more proposals and to be pushed,” he said. “I think Mayor Johnson starts with a place where we see feasibility in his ideas, but that doesn’t mean that those are all the ideas at the table.”