Key Takeaways
- The Chicago City Council has passed the 2026 budget, which includes a range of fee increases and changes, such as a tax on single-use checkout bags, a retail liquor tax, and the legalization of video gambling machines.
- The budget avoids implementing a corporate head tax and makes a full advanced pension payment, two provisions that were identified as top priorities by the group of alderpeople backing the proposal.
- The passage of the budget is a major rebuke of Mayor Brandon Johnson, who has maintained that the alternative proposal is deeply unbalanced and could lead to a $163 million deficit next year.
- The budget includes a range of revenue-generating measures, such as the sale of city debt, the expansion of congestion fee zones for rideshares, and the placement of ads on city-owned bridge houses and light poles.
- The budget has been criticized by progressive alderpeople, who argue that it relies on uncertain and unstable revenue assumptions and pushes real costs into the future through one-time fixes.
Introduction to the 2026 Budget
The Chicago City Council has passed the 2026 budget, which includes a range of fee increases and changes. The budget avoids implementing a corporate head tax and makes a full advanced pension payment, two provisions that were identified as top priorities by the group of alderpeople backing the proposal. The passage of the budget is a major rebuke of Mayor Brandon Johnson, who has maintained that the alternative proposal is deeply unbalanced and could lead to a $163 million deficit next year.
Fee Increases and Changes
The budget includes a range of fee increases and changes, such as a tax on single-use checkout bags, which will rise from 10 cents to 15 cents. The budget also includes a new flat fee on off-premise liquor and beer sales, which will affect retail sales of liquor, beer, and wine, but not those sold directly to customers drinking at bars or dining at restaurants. The fee was reduced from an earlier 3 percent proposal to 1.5 percent. Additionally, the budget includes a range of revenue-generating measures, such as the sale of city debt, the expansion of congestion fee zones for rideshares, and the placement of ads on city-owned bridge houses and light poles.
Criticism of the Budget
The budget has been criticized by progressive alderpeople, who argue that it relies on uncertain and unstable revenue assumptions and pushes real costs into the future through one-time fixes. Ald. Jessie Fuentes (26th) said that the budget "assumes revenue will materialize without sufficient evidence, and it pushes real costs into the future through one-time fixes. That is not responsible budgeting. It’s wishful thinking." Mayor Brandon Johnson has also maintained that the alternative proposal is deeply unbalanced and could lead to a $163 million deficit next year. He has raised specific concerns over the debt sale stipulation, which he has said is unfeasible and "immoral."
Property Tax Hike for Libraries
The budget includes a small property tax hike to fund currently vacant staff positions and security guard roles at the Chicago Public Library. The cost per household will vary, but Ald. Raymond Lopez (15th) said it would amount to about an $11 increase, on average, for homeowners next year. Alderpeople defended the hike as necessary to ensure libraries continue to offer their current services and hours across the city. "I think the way we restore trust with our residents in government is when they know what their dollar is paying for, and they value what their dollar is paying for," Ald. Daniel La Spata (1st) said.
Sale of City Debt
One of the most controversial additions to the alternative budget has been a proposal to sell city debt to outside collectors, which some alderpeople estimate could bring in about $90 million in revenue next year. The stipulation doesn’t specify how that debt could be collected, which would be left to the "executive branch" to implement. The proposal to actually sell off city debt has been sharply criticized by some alderpeople, activists, and Mayor Johnson himself. "Balancing [the budget] off the backs of working people, particularly selling off debt and setting up a situation where working people and poor people are going to be harassed and berated by debt collectors, that is not the right approach," Johnson said.
Video Gambling Legalization
The budget includes the legalization of video gambling terminals at bars and restaurants across the city. Backers estimate it would bring in $6.8 million in 2026 as operators start paying the necessary license fees. Ald. Anthony Beale (9th), one of the proposal’s most ardent supporters, said the revenue would be far greater in the years to come. "Once it’s up and operational, it could bring us between $65 and $100 million a year. That’s a lot of money. I don’t see Bally’s [casino] bringing that kind of money into the city," Beale said. However, the Johnson administration disagrees with the revenue projections, citing previous agreements with Bally’s that would result in a loss of a $4 million community benefits payment if video gambling machines are legalized.