An alternative budget proposal without a head tax is moving forward, as the stalemate continues at City Hall.
Members of the City Council got creative in how they made up for the revenue lost by taking out the head tax and replacing it with plans to add restaurant video gaming and sell new ads on light poles and other infrastructure.
After four hours of debate Tuesday, the Committee on Finance approved the alternative budget plan 22 to 13, but it’s still several steps away from final approval.
The proposal is different from Mayor Brandon Johnson’s plan, which includes a tax on the largest companies in the city. Under Johnson’s plan, employers with 500 or more employees would pay a $33 per employee per month tax.
A group of alderpersons united together against the head tax and came up with their own plan. They presented the full details Tuesday at a finance committee hearing. There are fee hikes, including a plastic bag tax increase from 10 cents to 15 cents, a hike in rideshare taxes and liquor sales. There are also plans to add video gaming in restaurants and bars, generating $6.8 million, as well as advertising on light poles, bridge houses and city vehicles, generating $29.3 million.
The alternative plan also makes the full advance pension payment.
“On October the 16th, the (mayor’s) budget proposal was put before us. We’ve seen several iterations of this. One’s been voted down. The group that’s worked on this [alternative budget] has spent hundreds of hours bringing in the majority of the City Council to talk about this. We relied on the advice and counsel of budgetary experts. We put this together, many people adding contributions. We brought it forth today. We’re getting questions and accusations from people,” said Ald. Matt O’Shea from the 19th Ward.
The proposal previously included a garbage tax increase, but that was taken out. It now moves for a full vote on the council floor.
“Thank you all for … removing the garbage fee, although I still don’t agree with the bag tax. Like I said, nothing is perfect,” said 17th Ward Alderman David Moore.
When the mayor was asked whether he will veto a budget without a head tax, he said it “depends on what’s in it.” Johnson released a statement Tuesday after the finance committee vote critical of the alternative budget, which he’s dubbed “the Secret Budget.” A big sticking point to Johnson is the plan to increase debt collections.
“This seems to be in direct contradiction with their expressed desires to shift the financial burden away from working people. Not only is this proposal immoral, it is simply not feasible. There is no way to sell off Chicagoans’ debts that would yield that amount of revenue. If passed as is, this proposal would likely result in a significant midyear budget shortfall and leave Chicagoans vulnerable to deep cuts to city services,” Johnson said in a statement.
Johnson said his budget, finance, legal and policy teams will spend the next few days reviewing the proposals.
The 2026 budget plan needs to be approved by the mayor and at least 26 of the 50 alders by Dec. 30. If that does not happen, it could lead to a government shutdown, which the mayor has said he will “do everything in [his] power” to avoid.
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