Mayor Brandon Johnson's $1.25 billion borrowing plan for affordable housing approved
CHICAGO (CBS) -- The Chicago City Council on Friday approved Mayor Brandon Johnson's plan to borrow $1.25 billion over the next five years to fund affordable housing projects and other economic development efforts across the city.
The 32-17 vote came only after multiple failed attempts by some aldermen to further increase the amount of City Council oversight over the plan, after had previously Johnson agreed to give them more control over specific projects.
The mayor's goal is to borrow $250 million a year through 2028 to fund efforts to expand affordable housing, and boost small businesses and nonprofits, while allowing dozens of TIF districts to expire. TIF districts divert a portion of property tax revenue away from various taxing bodies for up to 23 years to set that money aside for economic development initiatives.
The Johnson administration has said the project would be funded with property tax revenue that returns to the city as TIF districts expire.
"I am excited to support this initiative that will bring funding opportunities that have not been available before to parts of this city that have been disinvested or need additional funding," Ald. Nicole Lee (11th) said.
Although the mayor had previously agreed to increase City Council control over the borrowing plan by requiring alderpeople to approve any project valued at more than $5 million, many council members wanted that threshold lowered to $1 million, only to be repeatedly voted down by the mayor's allies.
The measure also would require quarterly progress updates from the Chicago Department of Housing and Chicago Department of Planning and Development, rather than yearly updates as the mayor originally proposed.
Ald. Brendan Reilly (42nd) said the borrowing plan could be "a very powerful and impactful program" for the city, but he didn't understand why aldermen were "taking ourselves out of the conversation" by not voting to give themselves greater oversight.
"We are talking about a massive amount of money here, and I would have a lot more trust in the program if I knew any investment over a million bucks needs to be invested and approved by the 50 people who serve on the City Council. Not just because it's our role as legislators to appropriate, but because the public then would get to see these projects before they're approved," he said. "These aren't our dollars, this isn't play money, this money belongs to the taxpayer."
Ald. Anthony Beale (9th) said he supports the mission of the mayor's borrowing plan, but couldn't support it without the lower threshold for City Council approval of individual projects.
"Doing that, that would empower this body to have more transparency, more input on what's going on with this bond issue," he said.
Ald. Bill Conway (34th) last week had sought to downsize the mayor's borrowing plan from $1.25 billion to $350 million, but that proposal also was voted down.
On Friday, Conway sought to downsize Johnson's plan to a total of $750 million and limit the length of the program to the remaining three years of the mayor's and City Council's current term, arguing they shouldn't saddle future administrations with such a large obligation, but that effort also failed.
Finance Committee Chair Ald. Pat Dowell (3rd) said a $1 million threshold would place an "unnecessary burden on the development process."
"We already know that we're existing in a fragile market right now. We don't need to add more red tape to the developers that want to invest in our neighborhoods and invest in our city," she said.
Dowell also noted that many of the construction projects that could be funded under the mayor's program would likely still require separate City Council approval for necessary zoning changes or other matters under existing city rules.
Ald. Walter Burnett (27th), Johnson's vice mayor, however, also cautioned against adding more red tape to development projects in Chicago, saying it already takes him three years to actually cut the ribbon on new construction projects in his ward after they're first proposed.
"If you all want to keep playing with this stuff, and not have any ribbon cuttings to show your community that you did in your community, keep playing," he said. "If you want to take the opportunity to negotiate with Planning and Housing, and possibly more infrastructure money outside of what you get out of your regular menu, get on board, man. Take care of your business. Take care of your ward."
Johnson administration officials have said the borrowing plan will cost $81 million a year in debt service to borrow $250 million a year for the project. Overall, the mayor's borrowing plan would cost the city $2.4 billion through 2061.