This week, Chicago Public Schools released its FY2013 Comprehensive Annual Financial Report for July 1, 2012 to June 30, 2013. In it, the District reports a year-end FY2013 deficit of $119 million that was closed using fund balance. This is smaller than the $273 million deficit that was anticipated when the District released its FY2014 budget. One of the main drivers behind the positive variance…
This article discusses a Standard & Poor’s Rating Services report released February 27 that disputed comparisons between Chicago and Detroit, concluding Chicago has the ability to make the changes necessary to avoid bankruptcy. The Civic Federation said the report is another reminder that Illinois lawmakers need to pass pension reform for Chicago in order for the city to start making fiscal…
It is widely known that the State of Illinois faces a dramatic reduction in general operating revenue starting on January 1, 2015, when temporary income tax rate increases enacted in 2011 are scheduled to partially roll back. General Funds income tax receipts will also decline around the same time for another reason: beginning on February 1, 2015, a portion of individual income tax collections…
This article examines Chicago’s growing debt load due to unfunded pension liabilities and ongoing borrowing. The Civic Federation said Chicago’s level of debt is unsustainable and the City is short on time to find a solution. The article cites the Civic Federation’s Status of Local Pensions and Financial Indicators reports, which respectively highlight the declining health of the City’s pension…
At a recent committee hearing, Illinois lawmakers were provided with a mixed message regarding the economy and State budget for the coming fiscal year. Officials from the Illinois Department of Revenue explained that although the State could expect improved underlying economic growth in the next two years, operating resources would still plummet in the next year due to current tax policy. Many…
This week the Chicago City Council granted the City authority to issue $900.0 million in general obligation bonds and $1.0 billion in Midway Airport revenue bonds. At the Finance Committee meeting on February 3, 2014, the City’s Chief Financial Officer Lois Scott said that approximately $90.0-$100.0 million of the GO bonds would be used to pay for litigation settlements from last year. About $130…
This article discusses a proposed ordinance for the City of Chicago to issue up to $900 million in general obligation bonds, with over $100 million used to push upcoming debt payments into the future. The Civic Federation said this practice, known as “scoop and toss,” increases the total cost of borrowing and the burden to taxpayers. The practice is prohibited under State law, but remains an…
As a follow-up to the Capital Planning Overview, this blog post summarizes information contained in the Civic Federation’s FY2014 budget analyses to compare how well the capital improvement plans (CIPs) of six major Chicago area governments conform to best practice guidelines. The governments are the City of Chicago, the Chicago Transit Authority (CTA), Cook County, the Cook County Forest…
Despite savings from recently enacted pension reforms, the State of Illinois’ finances could still worsen considerably after income tax increases are partially phased out as scheduled beginning in 2015, according to a report by Governor Pat Quinn’s office. The three-year general operating budget projection by the Governor’s Office of Management and Budget (GOMB) and an accompanying economic and…
The following posts were among the most highly read on the Civic Federation blog in 2013 and represent some of the most closely followed local government issues this year: City Council’s Proposed Independent Budget Office, A Civic Federation Recommendation January 2, 2013 This blog details a proposal introduced in the Chicago City Council on December 12, 2012 to create an Office of Independent…
