Chicago mayor says he'll propose $500 million tax hike

Chicago Mayor Rahm Emanuel admits that homeowners and their City Council representatives will find it difficult to accept a $500 million property tax increase. But he says he'll soften the blow with "fair and progressive" relief for seniors and worki

CHICAGO (FOX 32 News) - Chicago Mayor Rahm Emanuel admits that homeowners and their City Council representatives will find it difficult to accept a $500 million property tax increase. But he says he'll soften the blow with "fair and progressive" relief for seniors and working families.

It was another rough night Thursday in a tough week for the mayor.

Mayor Emanuel is holding a series of public hearings on his proposed city budget. At the first one on Monday, an angry resident went on a tirade and called the city's elected officials "hand-picked dummies"

Last night, angry protestors rushed the stage and the mayor had to be escorted out, ending the hearing then and there.

On Thursday night, there was a huge security presence so the mayor tried again. However this time, he had to deal with reaction to his proposal for a massive property tax increase.

"Red light camera money, lottery money, casino money! Where's it at Rahm?" a Chicagoan said.

Mayor Emanuel received another earful on the new city budget.

"Mr. Emanuel, this city doesn't have a money problem. It has a spending problem!" a woman said.

While the final numbers are still being crunched, sources indicate Mayor Emanuel will ask for another $500 million in property taxes, which is the biggest hike in Chicago history.

The mayor pledged Thursday that all of it will go to cover massive deficits in the police and fire pensions.

"By the time we're done in four years, the structural deficit that we inherited in 2011 will be eliminated," Mayor Emanuel said.

So what does it mean for property owners?

Cook Country Clerk David Orr's office estimates property taxes on a $250-thousand dollar home will jump by $470 dollars under the proposal.

Commercial property worth $250-thousand dollars would see an increase of more than $13-hundred dollars.

The mayor will need to sell the increase to Chicago aldermen, some of whom are skeptical.

"They're proposing this $500 million dollar tax increase. I think that's--we have to give something back. We can't keep continuing to go to the well and asking folks to pay more and more," said 36th Ward Alderman Gilbert Villegas.

"If you're asking me do I believe we'll get it done, the short answer is yes. Because I believe the aldermen are up to the task of charting a new course for Chicago's future," the mayor said.

But many of those aldermen were on hand at Thursday’s budget hearing, and heard rhetoric such as:

"$500 hundred million dollars! People live on fixed incomes in this city Mr. mayor. I live on a fixed income. You raise up the taxes, you're gonna see a mass exodus of people getting the hell out of this goddamn city. The taxes are out of control," one man said.

Emanuel on Thursday told the Chicago Sun-Times there is no other way to restore the city's financial health but a tax hike. Emanuel in coming weeks also is expected to propose a garbage-collection fee to generate $100 million more.

The garbage fee will be a monthly assessment of roughly $11 to $12 per household.

Alderman Pat Dowell says she sees a need for a property tax hike, but it'll be a lot to ask from a taxpayer who also has to pay a garbage fee.

Even with the increase, Chicago’s property tax rate is still much lower than the vast majority of suburbs. The mayor says he'll be fine tuning his proposal for the official unveiling of next year's budget on September 22.

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