Mayor Brandon Johnson’s $1.25B borrowing plan breezes through City Council

The City Council on Friday authorized a massive $1.25 billion borrowing plan for economic development and housing projects, handing Mayor Brandon Johnson a key victory in his plan to wean the city off a longstanding reliance on tax increment financing districts.

The plan was approved by a 32-17 vote over opponents who called for tighter council oversight of future projects.

It cleared the Finance Committee earlier in the week after Johnson allies fended off efforts by Ald. Bill Conway (34th) and Ald. Brendan Reilly (42nd) to lower the borrowing amount to $350 million and to reduce the threshold for projects to require City Council approval from $5 million to $1 million.

Conway made a last-ditch effort Friday to slash the borrowing amount to $750 million, while suggesting limiting the length of the borrowing to the terms of current council members.

Reilly also tried again to lower the council oversight threshold to $1 million, but fellow council members rejected discussion on either amendment — by a narrow vote of just 27-22 on the threshold. Another effort by Ald. Ray Lopez (15th) to lower it to $2.5 million was also rejected.

With interest, the plan could cost the city $2.4 billion over 37 years, officials have said. Johnson’s team says that money will be more than recouped by property tax revenue flowing back to the city’s coffers from expiring TIF districts.

Property tax revenues in TIF districts are diverted to pay for development projects within district boundaries for periods of 20 years or more. But critics have long contended the system exacerbates inequality because areas with higher property values often realize the most benefit.

Johnson and his allies have championed his borrowing plan as a more effective way to spur development on the South and West sides.

Reilly said the borrowing plan “could be a very powerful and impactful program,” but that was no guarantee “with a lack of transparency.”

“We are talking about a massive amount of money here. I would have a lot of trust in the program if any investment over $1 million is approved by the 50 people in this council,” Reilly said. “I don’t understand why we as legislators wouldn’t lower the cap for requiring approval.”

Ald. Maria Hadden (49th), who voted for the plan, said the $5 million threshold “is not a lot of money. When I think about all the projects in my ward, that’s a drop in the bucket.”

“Yes, technically things won’t be signed off on by all of the City Council… but I have full confidence that my community is going to be at the table,” Hadden said.

The measure was approved at a council meeting Friday that also saw council members approve $70 million in funding for the ongoing migrant crisis.

Council members had also been expected to consider a measure that would give alderpersons authority to decide whether to keep ShotSpotter gunshot detection systems in their wards, but that was pushed to a future council meeting because it didn’t make the agenda in time for proper public notice.