Broke Chicago: As Budget Hole Nears $300 Million City Could Lay Off 1,500 Workers, Tap Parking Meter Money

Chicago is facing a budget deficit close to $300 million and city officials say they will need to lay off nearly 1,500 city workers unless union officials agree to contract reductions. But the threatened cuts won't come close to plugging the growing budget shortfall, as Greg Hinz notes on his Crain's blog:

But the real news is that those 1,500 layoffs will fill only about 10% of a hole in the city budget that's now approaching a stunning $300 million. So, where's the city going to get that kind of cash?

Hinz says the city will draw on its $320 million reserve fund created from the parking meter lease deal, but is "unlikely" to tap too much.

The AP has more details on the threatened layoffs:

CHICAGO (AP) -- Chicago officials say they must resort to laying off 1,500 workers because union leaders haven't agreed to proposed cost-saving measures.

According to a news release Friday, the city has begun sending out 1,504 layoff notices to city employees.

City officials say they're still open to negotiations.

The city has proposed that union workers agree to unpaid furlough days and that compensatory time be taken for overtime instead of cash. Labor leaders boycotted a scheduled meeting with Mayor Richard Daley earlier this week.

The layoffs would become effective July 15 and save $34 million this year.

Phone messages left for labor officials were not immediately returned Friday. Union leaders have said they wanted a two-year, no-layoff guarantee in exchange for accepting the furlough plan.

Comments

[MovingtoNorway]

This guy has to go. Recall election?

[BigSurf]

Daley should also give back all but one dollar of his salary

[MadinUptown]

"Greedy repubs" like Durbin who sold all his stocks after getting inside info that the market was going to really tank. Something tells me that the Daley fam would not be too happy to kick in a few more bucks.
$50k is rich?

[atlantajoe]

I don't see the problem here, all Daily has to do is raise taxes on the rich. Maybe just a 10% tax on income over 50K would keep these jobs and fill the other gaps. This tax could be increased if it is not enough, maybe only to 15 or 20%. With all of the rich democrats in Chicago I am sure this idea would be accepted by all exept the greedy repubs.

[KCFreedom]

Sounds like water's coming into the hull

[MadinUptown]

Damare has over $1B (that's with a "B") tucked away in his "Rainy day fund." That fund is made up of TIF $. TIF= tax $$ siphoned off from the general revenue and used as da mare and alerman see fit with no over sight. Wake up Chicago!

[47th]

Exactly! The city is broke but the TIFs are untouchable. Daley will waste this money on the Olympics that nobody wants!

[Cogs]

Daley and his clan are trying to hold it together until they can get their mitts on that Olympic money. They've been training all their lives for this chance and the gold is finally within reach.

[KCFreedom]

Yea, that's some serious cash to graft

[REGONE]

He should fire himself plus the alderman, that'll make me happy.

[Chicago48]

I'm a union worker but I'm logical enough to realize that cities (of which I am paid part of my salary) are hurting. States are hurting. We can go back decades and point fingers and assess blame but we have to look at what's happening today. The unions have to bend a little and be prepared to sacrifice like the common worker. The whole country is in a mess and the fed govt can come to the rescue only so many times.

The Mayor's face says it all. He don't want to do it, these are his constituents, but he's gotta do it. 1500 layoffs won't help and there will be more. I can honestly see City Hall shutting down and going 4 days a week vs. 5 days a week.

[getumall]

Where did all the money go Mr. Mayor?
You are a disgrace to the city of Chicago... hopefully, the good people of the city will give YOU a layoff notice in the next mayoral election.