PI Original Ellyn Fortino Wednesday June 17th, 2015, 4:44pm

Chicago City Council Roundup: $1B Borrowing OK'ed, Minimum Wage Fight Continues

Progress Illinois provides highlights from Wednesday's Chicago City Council meeting.

Without debate, the Chicago City Council on Wednesday approved $1.1 billion in new borrowing meant to restructure the cash-strapped city's debt and pay down bills.

Of that $1.1 billion, more than $380 million involves shifting variable-rate debt to fixed-rate debt. Another $170 million is for "scoop and toss" debt restructuring, which occurs when debt is kicked down the road by a tactic that pays off current balances with new bonds.

The $1.1 billion in borrowing would also be used to cover debts from the Daley administration and other obligations, including $75 million in retroactive pay for police officers.

Alds. Scott Waguespack (32nd), Carlos Ramirez-Rosa (35th) and John Arena (45th) voted against the borrowing package.

Ald. Ed Burke (14th), chairman of the council's Finance Committee, and Ald. Patrick Daley Thompson (11th) abstained from the vote. Thompson recused himself as his cousin, William Daley Jr., works for Morgan Stanley, which is serving as "senior managing underwriter" for the $1.1 billion borrowing package, and, as a result, will receive more than $2.6 million from the deal, the Chicago Sun-Times reports.

Burke was the only alderman to offer comments on the council floor about the borrowing package before the vote.

"This is a step that is necessary to re-fund existing debt and begin to take steps to claw out of the financial condition that we're in," he said.

Asked later by reporters why he voted against the $1.1 billion borrowing plan, Ramirez Rosa said: "When you borrow money, you have to have a plan on how to pay it back, and I think that what's gotten us into the issue right now that we're facing is that we continue to borrow money, borrow money.

"We continue to pass the buck, but we never come up with a plan on how we're going to generate revenue," he continued. "And that's why I could not in good conscious vote 'yes' to additional borrowing without a plan on how we're going to pay it back."

Waguespack, one of the mayor's most vocal critics, said he voted "no" because he "found it pretty irresponsible for us to borrow this much money when just about a year ago we borrowed $1.9 billion."

"And we don't have a plan for paying it back," he stressed. "We don't see a comprehensive financial plan that was promised before and after the campaign. We don't see a revenue plan, and we're coming up on a budget that will include an additional $100 million we have to pay back just for this borrowing alone."

At Monday's Finance Committee hearing, Chicago's Chief Financial Officer Carole Brown argued that "it would be irresponsible not to proceed" with the borrowing plan, explaining that without it, "there would be the potential that we would have to come up with close to $900 million to pay back the banks."

"This is not kicking the can," she stressed. "This is not shuffling the deck chairs. This is a real step (toward) returning to a state of more fiscal responsibility."

As for city revenue proposals, Waguespack highlighted a few areas that could be looked at, including taxes on luxury commodities plus other services and goods as well as modifications to real estate transfer taxes. Aldermen have floated other revenue ideas such as a city income tax and the elimination of free city garbage pickup for some 1,800 multi-unit buildings still getting the perk. Alds. Matthew O'Shea (19th) and Carrie Austin (34th) introduced an ordinance Wednesday that would do away with that free garbage service, which would save the city an estimated $3.3 million.

Regarding property taxes, Waguespack said, "I don't think any of us are opposed to a property tax increase, as long as it's incremental to a lot of the other proposals that are on the table."

There are also potential long-term revenue streams that would need approval in Springfield, Waguespack said, adding that the "mayor should be down there fighting for those as well."

After Wednesday's council meeting, Emanuel declined to comment on specific revenue proposals that have been presented by aldermen, saying he wants "people to have the freedom, the liberty to offer ideas both from savings, efficiencies, cuts, consolidations as well as revenue."

Emanuel called for aldermen to put forward additional revenue and cost-cutting ideas the same day he announced that he will be presenting his 2016 budget one month early. His budget introduction will now come in September, with a final fiscal plan aimed for passage in late October.

In a Wednesday letter to aldermen explaining the change, Budget Director Alex Holt said, "As you know, the city is facing momentous budget and pension challenges ... We are accelerating the 2016 budget, which will allow us to quickly tackle these challenges."

"In September, Mayor Emanuel will introduce his 2016 budget, which will include both the annual operating plan and the resources to fund the city's pension obligations," the letter adds, according to the Chicago Sun-Times. "However, we are seeking your input now so that we may leverage your experience and ideas."

Among other pressing fiscal issues, the city has a projected budget shortfall for next year of nearly $1 billion. In addition, the city has $20 billion in unfunded pension liabilities. The Chicago Public Schools also has a $634 million payment it has to make by the end of June to the Chicago Teachers' Pension Fund for the city's public school educators. Emanuel ducked questions Wednesday on whether the Chicago Public Schools will be able to make the full pension payment by July 1, reiterating that he is looking to Springfield for possible help in tackling the school district's financial issues.

After approving the $1.1 billion borrowing package, the council authorized $3 million in settlements for lawsuits involving two police shooting deaths.

One of the settlements worth $1 million involves of the November 2010 shooting death of 21-year-old Joshua Madison. The second settlement totaling $2 million is connected to the May 2011 fatal police shooting of 19-year-old Calvin Cross. Click through for additional details on those cases.

The council also OK'ed changes to Navy Pier's public drinking rules. Under the changes, people will be allowed to bring alcoholic beverages purchased at Navy Pier inside the facility, opposed to only outside.

LGBT Caucus Formation

Openly gay Alds. Ramirez-Rosa, Raymond Lopez (15th), Deb Mell (33rd), Tom Tunney (44th) and James Cappleman (46th) officially formed the council's first Lesbian, Gay, Bisexual and Transgender (LGBT) Caucus on Wednesday.

"LGBT issues touch all communities, whether it's bullying, access to health care, AIDS, homeless youth or transgender issues," Ramirez-Rosa said. "It's crucial that we have a forum to discuss these important issues and a mechanism to speak with a unified voice."

Tunney, Chicago's first openly gay alderman, is chairman of the LGBT Caucus. Mell is vice-chair.

"It's been an amazing journey for our city and our community over the last 12 years," said Tunney, first elected in 2003. "I'm proud to stand here with my colleagues in a city and state that treats us as full and equal citizens."

Accommodations For Nursing Moms At Chicago Airports

Alds. Burke and Leslie Hairston (5th) introduced an ordinance Wednesday that would require Chicago airports to have designated lactation rooms for breastfeeding mothers.

According to the ordinance, "Each room or other location shall be located outside the confines of a public restroom and shall include, at a minimum, a lockable door, a chair, a table and electrical outlet, and a sink with running water."

If approved, the mom-friendly ordinance would take effect in January 2016.

There is a state measure, SB 0344, awaiting action from Republican Gov. Bruce Rauner that looks to have similar accommodations in place for breastfeeding mothers at Illinois airports by 2017. The proposed Lactation Accommodation in Airports Act cleared the state legislature last month.

"Nursing mothers should not have to wait until 2017 for clean and private spaces to breastfeed their infants at Chicago airports," Burke said.

The proposed city measure also mirrors a federal bill on the issue introduced last month in the House by U.S. Rep. Tammy Duckworth (D-IL,8). Duckworth's bill, the Friendly Airports for Mothers Act, seeks to make private lactation rooms a requirement at all major U.S. airports.

Burke and Hairston are looking to have Duckworth testify before the Chicago City Council on the need for airport accommodations for nursing moms.

2014 study published by Breastfeeding Magazine showed that only eight out of the 100-busiest U.S. airports met minimum requirements for a lactation room. Those minimum requirements include "a space other than a bathroom, with an electrical outlet, table and chair."

Chicago Minimum Wage Going Up To $10 Next Month As Fight for $15 Continues

Ahead of Wednesday's meeting, Raise Chicago coalition members and several aldermen celebrated the hourly minimum wage increase to $10 that will take effect in the city on July 1.

Chicago's minimum wage is currently $8.25, but it is set to go up gradually to $13 by 2019 under a mayor-backed city ordinance approved last December.

The $1.75 wage hike taking effect next month represents the first increase under the city's $13 minimum wage phase-in plan.

Raise Chicago members consider the city's new minimum wage policy to be a good step forward, but they say they won't stop fighting for an increase to $15 an hour.

Minimum wage McDonald's employee Andre Thigpan is one among "hundreds of thousands" of workers in the city that Raise Chicago says will see a raise on July 1.

While Thigpan said he is happy that his pay will go up, he said it will still be hard for him to make ends meet on a $10 an hour wage.

"I'm the only one working in my household right now, so I'm supporting my mom, my little brother, my whole family," he said. "And it's a shame that I get paid Monday, [and] my check's gone Wednesday. It definitely shouldn't be like that. McDonald's (is) a multi-billion dollar company. They can afford to pay us what we deserve ... We work hard every day, and we should get that $15 an hour."

During the previous council term, Progressive Reform Caucus members and other aldermen proposed an alternative $15 minimum wage ordinance. Arena was among the council members involved with last term's $15 wage effort.

At today's news conference, Arena said he is "very proud" that minimum wage workers in Chicago will get a $1.75 raise on July 1. However, he stressed that workers won't get "to $13 fast enough."

"We need to keep pushing to move that [phase-in] date up to move towards $15 an hour," the alderman said.

"We see this going on in other major cities," Arena noted. "LA just passed this. Why are we second to LA? Let's be first on some of these most pressing issues and move fast. Today, we're going to talk about $1.1 billion in debt that we're going to issue to this city. Let's put money in the hands of the folks that are going to spend that money in our neighborhoods, support our local businesses, make sure their kids have food on the table. I'm committed to working with every one of the members of the coalition, every one of my council members and everybody in the city of Chicago to realize $15 before 2019."

Arena said Progressive Reform Caucus members plan to have conversations with other aldermen around a new $15 minimum wage proposal in the council.

"We're starting a new council, so we want to start working with our new colleagues and talk about the issues, educate them, and this is going to be an ongoing dialogue," he said.

In addition to Arena, Waguespack and Alds. Joe Moreno (1st), Roderick Sawyer (6th), Ricardo Munoz (22nd) and Jason Ervin (28th) were at the Raise Chicago press conference.

Comments

Raising the minimum wage isn't the answer.  Make it easier for the employees to join or form a union.  Let the wages be determined by honest and open negotiations instead of determined by the government.   

Less government control and regulation is better.  Let the free market determined wages.

Repeal the Taft-Hartley Act and pass the Employee Free Choice Act - eliminating many of the government control and restriction and restoring freedom in the marketplace.

Raising the minimum wage actually works AGAINST unions.  Why join a union, or organize, or pay dues when you can get this benefit from the government?

Bob Kastigar, IBEW Local 1220, Chicago

 

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