CITY HALL — The City Council passed a 30 percent increase in the water and sewer tax Wednesday in a bid to float a potentially insolvent pension fund for city employees.
The tax hike will be phased in over five years and, according to Mayor Rahm Emanuel's administration, will cost the average household an extra $4.50 a month next year and $19 a month when fully implemented.
That works out to an average hike of $228 a year within five years.
According to Emanuel, who sought the tax increase, it will raise $56 million next year for the Municipal Employees' Annuity and Benefit Fund, which had been projected to run dry in 2025. When fully implemented, it will contribute $240 million a year to the fund, which benefits most city employees not covered by police and firefighter pensions.
"Nobody likes to raise taxes, but everybody likes to make sure they have a secure retirement," Emanuel said in praising aldermen for doing "the hard things and the necessary things."
Ald. Edward Burke (14th) said it was "absolutely incumbent" to "head off a potential disaster." He called it in the "best interests of the city and its pension-fund members."
Critics of the tax in the Council complained that the pension fund still will need a $300 million infusion in 2023 to bring it up to necessary levels, and Budget Director Alexandra Holt has acknowledged that another source of revenue would be necessary at that point.
Ald. Roberto Maldonado (26th) said his constituents feel they are being "taxed to death," although in the end he voted in favor.
Ald. Patrick Daley Thompson (11th) called the tax "unreasonable."
The majority of the Council, however, considered it a necessity in passing it Wednesday by a 40-10 vote.
Aldermen voting against included Thompson, Leslie Hairston (5th), Susan Sadlowski Garza (10th), Toni Foulkes (16th), David Moore (17th), Christopher Taliaferro (29th), Scott Waguespack (32nd), Gilbert Villegas (36th), Anthony Napolitano (41st) and John Arena (45th).
The council also unanimously approved an attempt to repair past snafus in the red-light and speed-camera systems.
For more neighborhood news, listen to DNAinfo Radio here: