Special Newsletter - 2026 Budget

Alderwoman Ruth Cruz

Oct 27, 2025

Dear 30th Ward residents,

Mayor Brandon Johnson presented his 2026 budget proposal for the City on October 16. The administration faces the challenge of addressing an estimated $1.15 billion deficit while maintaining investments in the City’s people and infrastructure. I am reviewing the proposed budget with an eye towards balancing it through strategic adjustments to services and revenue streams to ensure fiscal sustainability.

There will be difficult choices ahead, and we may not all agree on every decision. I encourage you to share your feedback throughout this process, as the decisions I make will be guided by community input and aimed at serving the best interests of our neighborhood and city.

Overall budget picture

Overall, the $16.1 billion spending plan is 3.2% lower than last year’s budget. The proposed budget does not include a property tax increase, nor is there a grocery tax—the state eliminated the tax earlier this year but gave local governments the option to reinstitute it. (Before it was eliminated, the grocery tax contributed approximately $80 million annually to City revenues.)

At this point in time, I will be watching three major areas closely:

First, the decision to declare a very large TIF surplus of $1 billion. This would result in the loss of $13,452,632 from the fund balance of the Belmont Central TIF district, much of which lies in the 30th Ward, hurting our ability to make infrastructure and other public improvements.
Second, reducing the advance pension payment by nearly $118 million. This payment is intended to reduce the City’s enormous pension debt by more than the legally required amount, thereby saving the City even more money in the future. I have serious concerns that reducing this advance payment could lead to credit rating agencies downgrading the City’s debt, increasing our borrowing costs and costing us far more than the $118 million saved.
Third: The head tax, a proposed tax on companies with 100 or more employees, at a rate of $21 per month per employee. Funds raised would be devoted to community violence reduction programs and other public safety measures.

Pros of the head tax:

Could provide additional revenue to help balance the City’s budget.
Ensures that big companies pay their fair share.
Only about 3% of businesses in the City would be affected.

Cons:

May send the wrong signal to the business community.
Could discourage companies from moving to or expanding in Chicago.
This might prompt some businesses to relocate elsewhere.

My staff and I will be considering the mayor’s budget proposal thoroughly to assess what parts I can support and which I oppose and will seek to change. The City Council will undoubtedly make many alterations to the mayor’s budget proposal, and I will take an active part in those discussions and negotiations.

Highlights of the Mayor’s proposal

Item	Amount
NEW OR EXPANDED TAXES AND FEES:
Personal property lease transaction tax increase – Also known as the “cloud computing tax,” this is a tax on software programs hosted online, like Salesforce. The tax rate will increase from 11% to 14%.	$333,200,000
Community safety surcharge, also known as the employee “head tax.” The money will go to new “community safety fund” established for violence reduction. The surcharge will be $21 per month per employee for companies with 100 or more employees (3% of businesses in the city).	100,000,000
Social media amusement and recreation tax (SMART) – This is a tax on social media companies like Facebook and Tiktok. The money will go to a new “protecting care fund” to cover expansion of teams responding to mental health emergencies instead of police. The logic is that these social media companies’ products lead to mental health issues in children as well as adults. The tax will be 50 cents per user in Chicago, after the first 100,000 users.	31,000,000
Ground transportation tax changes – this applies to rideshare companies like Uber and Lyft. The existing congestion surcharge zone will be expanded to include the most congested 20% of areas in the city, and the tax will change from a flat rate (which varies by vehicle type and time of day) to 10.25% per ride.	5,400,000
Hemp tax – This is a $2 per unit tax on on hemp-derived products like Delta-8 and THCA.	10,000,000
Enhanced debt plan and Smart Streets expansion. We are seeking more information about what the debt plan is, but Smart Streets is automated enforcement and ticketing of vehicles blocking bus and bike lanes along streets.	47,300,000
Online sports betting tax – This is a tax on 10.25% of gambling companies’ adjusted gaming receipts.	26,200,000
Boat mooring fee increase, from 7% to 23%, for boats moored along City waterways like harbors and marinas.	4,100,000
Vacant building renewal fee, meant to dissuade building owners from leaving their properties vacant.	400,000

OTHER REVENUES:
City’s share of tax increment financing (TIF) surplus. The total amount to be declared surplus is $1 billion, but that is apportioned out to the different taxing districts. Chicago Public Schools will receive the largest share, over $500 million.	232,600,000

LOWERED EXPENDITURES:
Operational efficiencies. Changes to how departments carry out their duties that reduce operating expenses.	111,900,000
Personnel savings (including hiring freeze). There are exemptions for public safety, revenue generation, legislative, elections, consent decree, information technology, mental health, and litigation savings positions.	100,600,000
Reduction in advance pension payment. For the last few years, the City has been paying more than it is legally required to pay to bring down the total future cost of retirement benefits for City employees. Those retirement funds are currently severely underfunded. This measure would reduce that additional payment, in part because the City is already ahead of where it had planned to be at this point in time, but the City will have more ground to make up in the future.	117,800,000

INCREASED EXPENDITURES:
Rapid rehousing program. This will allow for homeless people to be quickly moved off the street and out of parks, etc., into housing.	-5,100,000

Note: The budget does not eliminate any of the nearly 1,000 police vacancies, but it does include a cap on police overtime beyond $200 million. Any overtime expenditure over that amount will have to be separately approved by the City Council.

We want your opinion!

Please take our budget survey (links below) to let us know what you think about the mayor’s proposal and some of the individual items within it. You can also email us at Ward30@cityofchicago.org.

Understanding what the community thinks makes me a more effective advocate in the City Council.

Upcoming budget town hall

I am planning to hold a budget town hall in the coming weeks, most likely a virtual meeting on Zoom. Please stay tuned to our newsletter and social media for details.

Attend or watch the budget hearings

The hearings held by the Committee on Budget and Government Operations on the 2026 Budget began this week. You can attend in person in the Council Chamber at City Hall, 121 N. LaSalle St., and watch live sessions or past recordings online on the City Clerk’s website.

Tuesday, October 21, beginning at 10 am

Office of Budget and Management
Department of Finance
Office of the Chief Financial Officer

Wednesday, October 22, beginning at 9:30 am

Department of Transportation
Department of Streets and Sanitation
Department of Technology and Innovation

Thursday, October 23, beginning at 9:30 am

Department of Aviation
Department of Water Management
Department of Fleet and Facility Management
Department of Buildings

Wednesday, October 29, beginning at noon

Office of the Inspector General
Department of Procurement Services
Department of Environment

Thursday, October 30, beginning at 9:30 am

Mayor's Office for People with Disabilities
Department of Family and Support Services
Department of Public Health
Chicago Commission on Human Relations

Tuesday, November 4, beginning at 9:30 am

Department of Business Affairs and Consumer Protection
Department of Planning and Development
Department of Housing
Department of Cultural Affairs and Special Events
Chicago Public Library

Wednesday, November 5, beginning at 9:30 am

Chicago Police Department

Thursday, November 6, beginning at 9:30 am

Office of Public Safety Administration
Office of Emergency Management and Communications
Chicago Fire Department

Wednesday, November 12, beginning at 9:30 am

Department of Human Resources
Board of Ethics
Civilian Office for Police Accountability
Community Commissioner for Public Safety and Accountability
License Appeal Commission
Chicago Police Board

Thursday, November 13, beginning at 9:30 am

City Treasurer
City Clerk
Department of Administrative Hearings
Chicago Board of Elections
Chicago Animal Care and Control
Department of Law

Detailed information about the budget:

The budget recommendation documents are available for download on the Office of Budget and Management 2026 Budget webpage:

2026 Budget Overview
2026 Budget At-A-Glance (Spanish version and Polish version)
2026 Budget Recommendations Book (large document)

And you can read press coverage of the mayor’s budget proposal here: