Chicago debt: Rahm wants to raise property taxes

Aspen Institute Ideas Festival
ASPEN, CO - JULY 02: Rahm Emanuel speaks at the Aspen Ideas Festival 2015 on July 2, 2015 in Aspen, Colorado. (Photo by Riccardo S. Savi/WireImage)
Photograph by Riccardo S. Savi — WireImage/Getty Images

Chicago mayor Rahm Emanuel is expected to propose a higher property tax on Tuesday, the Washington Post reports.

The higher taxes will hopefully help alleviate some of the city’s debt and repair the low credit rating of the public school system. The proposal may also suggest that Chicagoans pay higher taxes and fees for garbage college and sugary drinks, among other things.

Some are worried that this will damage the city’s reputation for being affordable, especially compared to New York and Los Angeles where median home prices are double those in Chicago. Chicago’s property taxes are actually the 12th highest in the nation above both Los Angeles and New York, but because property values are lower Chicago residents pay thousands less each year.

The proposal is receiving criticism before it has even been presented because Chicagoans already pay more for things like gasoline, parking, and sales tax, which is the nation’s highest at 10.25%.

Laurence Msall, the executive director of the Civic Federation, a tax and policy research organization, told the Washington Post that “One of the biggest problems is not the tax increase but the reaction to the tax increase. If people don’t think we’re going to solve things, they will leave.” Emanuel and other Chicago representatives have to convince residents that their money will be used appropriately and help alleviate some of the city’s financial problems.

Emanuel has attempted to raise revenue in other ways, like bringing casinos to city, but has been unsuccessful. He’ll be up for reelection in 2019, so if this proposal goes through he’ll have to prove to voters that it’s the right choice.

He has hinted that he’d seek property tax exemptions for low-income households and elderly residents, but he will need state approval for both the tax proposal as well as the tax exemptions. When asked about his proposal Emanuel said, “It is fair, it is equitable. It’s progressive.”

Subscribe to Well Adjusted, our newsletter full of simple strategies to work smarter and live better, from the Fortune Well team. Sign up today.

Read More

Great ResignationDiversity and InclusionCompensationCEO DailyCFO DailyModern Board