Johnson Bond Deal
City Council also temporarily deferred Mayor Johnson’s $830 million bond deal to finance capital projects and other spending for 2025. While the bond deal did pass the Committee on Finance the week before, it was new information released after the vote that led some of us to change our votes or decide to hold it up at the main council meeting this Wednesday. Choosing to release this information only after the committee meeting is dishonest and further evidence of the lack of transparency practiced by Mayor Johnson’s administration, a hallmark of his approach to governance.
It was not an issue to borrow funds as many municipalities across the United States regularly fund infrastructure and asset purchases through bond deals. Matching deals to the useful life of assets is important in these deals as is the repayment of the funds for the assets. For instance, a bridge may last forty years, while a police vehicle may last just a few years. As these assets depreciate (much like depreciation when taking a new car off the dealers lot) the bond deal repayment schedule should try to match the useful life of those assets.
However, with the new repayment schedule being released after the committee vote, this infrastructure and capital bond deal defers all principal payments for 20 years, and interest payments on the $830 million until 2028. While this may have been a bad practice a couple decades ago, there is no reason to double down on bad practices, as Mayor Johnson suggests we should. The lack of any principal payments and foregoing the interest until after the next mayoral election would leave a future mayor, council and our kids on the hook for a massive payment in 2045. And as one of my outside finance advisors put it, we are otherwise just starting to pay for stuff in 2045 that is already sitting in a recycling center.
The bond deal originally had language in it to allow funds to be used for “settlements” and “threatened litigation” that we did have removed. Such language was removed in the last couple of administrations to end an old practice that led to the city paying for settlements with expensive bond borrowing. Many of us have also been concerned about the shifting of bond funds for use with other agencies and entities in the City that have their own bonding authority but have used the City’s bonds to fund projects. This language in the bond deals was also amended and will be in all future deals.
The lack of trust now makes it very hard for many of us to vote in favor of the bond deal, now being pushed through for another vote early next week. The solution would have been to pay for our expenses now, and spending within our means for today. We also need to codify five year plans for spending that would give the council members and taxpayers definitive information about projects and assets being requested during major bond deals like this. While there are plans and information on proposals, many of these have been on the table for years and are not primarily paid for with the bond sources.
As I stated during council, this deal is putting all of the responsibility for today’s expenses on a future generation, “kicking the can down the road for future generations, for a future mayor and for future city council members to take on a responsibility after we have used up the assets and the funding that we’re voting on today…I don’t have an argument against borrowing. The problem is the lack of transparency, the lack of honesty, and the lack of trust” of the Johnson Administration.
The vote on this will be deferred until Wednesday the 26th as the Administration scheduled a new council meeting to take the bond vote.
Speed Limit Ordinance
This week in the council there was a vote to amend the citywide speed limit to 25 mph. It was voted down 28-21 during Wednesday’s City Council meeting. The last substitute by Ald. LaSpata to pass the ordinance was not accepted by Aldermen and the vote was not enough to get the final version the 26 votes needed to pass.
Rule 59 Changes
The council also discussed the Chicago only Rule 59 that was implemented after Covid hit. (All public meetings of the City Council and its committees may be conducted remotely by means of video, audio, telephonic or other electronic connection (“remote meeting”) in accordance with subsection (e) of Section 7 of the Open Meeting Act)
It was implemented for emergency reasons which were based on the Governor’s order allowing for municipalities to hold remote meetings. Chicago seems to be the only city still clinging on to a full out allowance for remote participation, which many aldermen want to be a permanent rule.
When I first became Alderman, the rules were that you were either present or absent, and had to vote yes or no if present (and still cannot abstain from votes as the General Assembly does). The new rule 59 has allowed aldermen to remain remote which has caused attendance issues at committee and council meetings.
The rule states: If a quorum of the members of the City Council or a committee is physically present, a majority of that quorum may allow a member of that body to attend the meeting by audio or video conference if the member is prevented from physically attending because of personal illness or disability; employment or the business of the public body; or a family or other emergency.
Unfortunately, this has led to many committee meetings being delayed and hundreds of requests for remote attendance for a myriad of reasons. Alderman Beale made an appeal to vote on repealing the Rule 59 at the end of the council meeting but withdrew it to allow for more discussion on the problem.
While I understand there are emergency needs, the practice needs to be capped or ended. Constant remote participation can also compromise the transparency of government and the public information available regarding attendance of elected officials. While we have meeting obligations that run simultaneously and other issues may arise, we have an obligation to be on the council floor as much as possible.
Link to the City Council meeting discussing the speed limit, Rule 59 and bond deal from this Wednesday.
