Chicago will make the second half of its advance pension payment this year, Mayor Brandon Johnson confirmed at the Chicago Investors Conference, but offered no specifics on the timeline, saying questions remain about timing due to property tax delays from Cook County.
"It's a question of when, not if," Johnson told the audience in a Thursday speech concluding the city's outreach event for municipal bond investors.
The mayor "did not provide any additional information about when it might happen, or what funds would be tapped to make that payment," noted Paula Worthington, senior policy advisor at the Civic Federation, a Chicago-based fiscal watchdog. Worthington attended the conference.
"Nonetheless, from the credit agencies' perspectives, that kind of expressed reaffirmation of that commitment is a really positive thing," she said.
"He did bring up the county, and that's a legitimate complaint," said Howard Cure, partner and director of municipal bond research at Evercore Wealth Management, who attended the conference, adding the county's
Johnson said nothing about running for a second term in his remarks Thursday. The election is in February.
"I don't know if he is or not," Cure said. "You would think that someone running for election would want to talk about what they want to achieve going forward," but Johnson's speech was "more about what they have accomplished," he said.
The mayor did highlight the successes of the progressive revenue solutions from his proposed budget that made it into the 2026 budget.
"Those structural progressive revenue sources are outperforming expectations," he said. "Our online sports wagering tax and social media amusement taxes are 69% and 25% above projections. That tells us something important about what works: structural progressive revenues that help ensure the benefits of growth are shared with working people."
Johnson also noted that "almost all" of the efficiency initiatives his administration has pursued are "on or ahead of target, saving the city of Chicago millions of dollars."
Some aldermen have criticized the administration for failing to implement a broader swath of the efficiencies proposed in
The mayor's speech kicked off a lively panel on the Chicago Financial Future Task Force,
The panel featured a discussion among Chicago's acting CFO, Brendan White, and the task force's co-chairs, Karen Freeman-Wilson, president and CEO of the Chicago Urban League, and Jim Reynolds, founder, chairman and CEO of Loop Capital.
Reynolds argued Chicago should be a double-A credit, and the city can get to that rating level with the right mix of fiscal solutions. Its general obligation ratings are in the triple-B range.
"With their economy, they should be" double-A, Cure said, adding the city had "a good story to tell" on tourism, public safety and broader economic conditions.
The task force chairs ably summarized key points from the menu of options they presented the city, Worthington said, but "I think it's also fair to say that it remains to be seen how those ideas get translated into actions by the city itself going forward."
Reynolds said the task force was "a grueling exercise," but a productive one. "Everything was on the table. We all had to sign NDAs. We got every bit of information we requested from the city, all of it," he said.
"I changed my number, and the mayor doesn't have it," Freeman-Wilson joked.
Reynolds and Freeman-Wilson were mostly sympathetic to the mayor and his team, with Reynolds echoing the mayor's point that "you can't cut your way out of something like this," and Freeman-Wilson saying of
Worthington said the pension legislation "is a perfect example of how sometimes changes in laws and expectations at the state level are put in place without attending to the downstream impacts."
Reynolds also sounded off about "home rule and why Chicago has given up so much of it. It's pretty shocking when you go back and look at how things got traded off," he said.
But he also voiced a note of light criticism. "We've seen more in the last few years, since the Daley era and the Emanuel era, a stepping back from the business community (being) engaged with the mayor's office," he said, stressing the importance of "that whole exercise of helping the business community create more jobs.
"Mayor Daley would call anybody on their cell phone and tell them to chip in. Not asking them to chip in. Telling them to chip in," he said.
One of the task force's suggestions was a required weekly or monthly meeting between the mayor and business leaders, Reynolds said, "to talk about what's going on.
"I'm not just going to stick you with a head tax. I want to talk to you before and let's see if there's another, better solution," he said.
"He's a politically savvy person," Cure said of Reynolds. "I think that's sort of his gentle way of nudging the mayor, of saying, 'We need to work closely.' … That's the big knock on the mayor, is what kind of relationship does he have externally with businesses… (Reynolds) was talking about keeping that line of communication open."
Cure said the timing of the conference "was a little tough" because of
"She says what she means and means what she says," Cure said of Gabrysch. "Her criticisms (at Fitch) were very justified… Hopefully she'll be working there for a while. I have a lot of confidence in Ashlee. The pressure's going to be on her to see what she can do to prevent any bad practices from reappearing."
The panel covered other constructive criticisms. Reynolds hinted that Illinois should revisit the question of a graduated income tax — Gov. JB Pritzker floated the idea in 2020, only to get shot down by voters amid a
He also called for regular meetings between Chicago and Springfield officials.
Cure said he asked city officials about relationships with the state, and was told they are trying to work with state lawmakers on the city's concerns, which include new revenue sources for Chicago. The pension sweetener legislation that imposed an unfunded mandate on Chicago was "a way for state legislators to get credit for helping a lot of workers without the state having to pay any money for it," he noted.
"Not only should the state play a role, the state has a vested interest in playing a role because, after all, Chicago is the economic engine that fuels the state of Illinois," Freeman-Wilson said. "So there has to be some collaboration."
The Civic Federation's Worthington said it shouldn't be lost that the city does still have some fiscal autonomy and decision-making discretion.
"What we're looking for really is evidence that the city can take on the idea of building and developing relationships in Springfield that advance the city's goals and objectives, but also, attend to the things that can be attended to by the city itself," she said.
Both Reynolds and Freeman-Wilson also praised the Chicagoans who offered feedback on the task force's recommendations. Unlike the interim report, the final report benefited from "a group that actually engaged the community and what they thought as we were doing it," Reynolds said.
"One of the greatest responsibilities that we have is towards civic engagement," Freeman-Wilson said. "While that may sound like a fairy tale story, especially coming from a recovering bond lawyer, it is really how things should work."
Chicago's general obligation bonds are rated BBB-plus by KBRA, BBB-plus by Fitch Ratings and BBB by S&P Global Ratings, with negative outlooks, and Baa3 with a stable outlook by Moody's Ratings.
