Chicago Mayor Brandon Johnson has released to City Council a report from the accounting firm Ernst & Young that his administration commissioned to offer solutions to the city's budget gap.
The Johnson administration had previously told alderpeople it would not release the $3.185 million full report, but would release excerpts.
More than half the City Council had formally requested access to the full report, according to a letter sent to Johnson this summer from 27 alderpeople and Janice Oda-Gray of the City Council Office of Financial Analysis.
The report, a
Its release comes on the heels of
The city faces a structural budget gap of $1.15 billion in 2026, rising to $1.23 billion in 2028, according to its most
Through a mix of efficiencies, revenue enhancements and budget and service delivery improvements, the Ernst & Young report identifies an estimated $530 million to $1.396 billion in total potential savings and revenue generation.
The report cautioned that none of its recommendations were both highly feasible and highly fiscally impactful; they were mostly one or the other.
For example, one of the biggest suggested savings, with a 10-year fiscal impact of $517.4 million, calls for the minimum manning on Chicago Fire Department engines and trucks to be cut to four from five.
That would require negotiations with the firefighters' union, which is unlikely to be receptive. The report classifies the proposal as low feasibility.
Other significant but hard-to-achieve savings were suggested for the police and fire departments, including reassigning some work to non-sworn personnel and disbanding the mounted unit and selling off the horses. It said the 10-year fiscal impact of all its public safety service recommendations could top $1.4 billion.
The accounting firm said its analysis was benchmarked against more than 40 peer jurisdictions, including New York City, Los Angeles, Philadelphia and Houston. Its report groups Chicago's opportunities for savings into nine categories.
The firm's employee benefit analysis identified $80 million to $103 million in potential annual savings, mostly from health benefits changes.
Those recommendations include increasing the level of medical employee contributions, raising medical copays and other out-of-pocket costs to employees, enacting a formal return-to-work policy, and making a strategic settlement effort in the city's worker's compensation arrangement.
For real estate, report said the city could see a preliminary 10-year financial impact of $157 million to $202 million, $30 million of that potentially realized in the first year alone, the report said.
The ultimate savings would hinge on the city's ability to carry out significant office consolidation, land sales and policy reforms, the report said.
Chicago has over 21 million square feet of space from more than 500 owned and leased properties, plus 10,400 vacant parcels, the report said.
The total potential revenue opportunities from changes to Chicago's more than 240 fees and fines ranged from $20 million to $74 million annually.
The procurement analysis identified five problematic themes: duplication across departments; non-contract spend; supplier concentration; vendor tail; and non-Department of Procurement Services managed spend.
The firm urged the city to adopt the Category Management approach to procurement, which, it said, emphasizes strategic decision-making over the more traditional and transactional approach. That could save the city between $55 million to $110 million a year, Ernst & Young said.
For budgeting, the report suggested a shift away from traditional budgeting and toward performance-based budgeting.
The report also suggested savings in the way the city handles special events and manages its vehicle fleets.
