JEFFERSON PARK — Three Far Northwest Side aldermen who voted against a 30 percent increase in the water and sewer tax formed the largest geographic block of opposition to Mayor Rahm Emanuel's bid to shore up pensions for city employees.
Ald. John Arena (45th), Ald. Gilbert Villegas (36th) and Ald. Anthony Napolitano (41st) joined seven other aldermen in voting against the measure that will cost the average household an extra $4.50 a month next year and $19 a month in five years.
All three said the tax hike was too high a burden to place on the residents of their ward, less than a year after the council approved the largest property tax increase in Chicago history to foot the $550 million bill for police and fire pensions that came due this year.
"I just can't do the tax, tax, tax thing," Napolitano said. "We have to find other solutions. It is hard for people to swallow."
The two other Far Northwest Side aldermen — Ald. Nicholas Sposato (38th) and Ald. Margaret Laurino (39th) — voted to support the tax hike, saying there was no other realistic way for the city to meet its obligations to its largest pension fund.
"It would be catastrophic if we didn't find a way to make these payments," Sposato said. "It will cost way more in the long run if we didn't."
The tax increase will raise $56 million next year for the Municipal Employees' Annuity and Benefit Fund, which had been scheduled to go bankrupt in 2025. The fund covers most non-police or fire department city employees, who have a separate pension fund.
Mayoral spokeswoman Molly Poppe said the vote puts the fund "on a path to solvency without jeopardizing ongoing investment in all our neighborhoods."
But the Emanuel administration acknowledged before the vote that the fund will still be $300 million short by 2023, setting the stage for another tax hike.
Arena said he voted against the tax hike because the numbers don't add up — especially if a significant number of city residents get a meter to measure the amount of water they use each month.
"I don't have confidence that the tax will generate the amount of money the mayor says it will," Arena said, noting that water bills for homes with meters average about $500 less per year than those residents who pay a flat fee. "I will certainly be encouraging my residents to get meters."
The mayor's representatives would not address those concerns, Arena said.
"The math has to work," Arena said. "These numbers don't add up."
In addition, Arena said the tax hike would hurt the poorest Chicagoans the hardest.
"This is a very regressive tax," Arena said, adding that he was frustrated the mayor refused considering other ways to generate revenue, including hiking taxes on the wealthiest Chicagoans, a tax on suburban commuters or one on financial service transactions.
"This has been part of a trend of proposals from this mayor" that spare “the majority of those who have contributed to his campaign while going after the pockets of regular Chicagoans,” Arena said.
"I have been demanding equity," Arena said. "There has been no willingness to explore those options."
The new taxes would require the approval of the General Assembly, which is controlled by Democrats, and Republican Gov. Bruce Rauner.
"We are not going to get help from Springfield," Sposato said. "That's not realistic."
The General Assembly — and Rauner — must sign off on employee concessions tied to the water tax hike as well as the new funding schedule for the pension fund.
But Rauner told Northern Public Radio he wasn't convinced Emanuel's plan would truly put the city's pension accounts firmly in the black, raising the possibility that he may veto legislation and trigger another fight in the state legislature.
"We need help for this plan, so that argument no longer holds water," Arena said.
Villegas, who along with Napolitano voted against the 2015 budget that included a $589 million property tax hike as well as $9.50-a-month charge for garbage pickup, said he was not surprised that opposition to the tax hike was centered on the Far Northwest Side.
"This will really hit us hard — especially in the Bungalow Belt, which is mostly middle class," Villegas said.
The total property tax bill on a home worth $250,000 is set to increase by more than $550 during the next four years to fund police and fire pensions.
In 2014, the Council agreed to hike the city's telephone tax by 56 percent to cover the shortfall in the laborers' pension fund. That meant every landline and cell phone in Chicago now pays an extra $1.40 every month.
After the water tax vote, Emanuel praised the aldermen who voted in favor of it for doing "the hard things and the necessary things."
Even though Napolitano voted against the mayor's proposal, he praised Emanuel for trying to address the massive deficits in each of the city's four major pension funds during the last several years.
"I get what the mayor is doing," Napolitano said. "He's fixing a problem that he didn't start."
Laurino, a close ally of Emanuel, said the decision to support the tax hike was "tough."
"We probably should have done it years ago," Laurino said. "We either pay now, or we pay more later."
Sposato said he was hopeful that the city was now "on the right track."
But Napolitano and Villegas said they could not ask the residents of their wards to pay more in taxes when they don't get effective city services in return for what they pay now.
"This is an absolute crisis," Napolitano said. "It is approaching taxation without representation."
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