Mayor Johnson, city officials looking for ways to close projected $1.2B budget shortfall

CHICAGO (WLS) — Chicago’s budget director has said 2026 will be one of the most difficult budget years in recent memory with the city facing another massive budget hole and few good ways to fill it.

“These roundtables are so important tonight,” said Chicago Mayor Brandon Johnson. “To make sure that we have a budget and budget process that ensures that all of our residents are heard.”

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On Monday, Johnson attended the second of four budget roundtables meant to engage the public ahead of what could be a contentious budget fight.

“You have budget imbalances when one side of your ledger is growing at a faster pace than the other. It would be great if that was on the revenue side, but unfortunately, it’s on the expenditure side,” said City Budget Director Annette Guzman.

The city projected a 2026 deficit of nearly $1.2 billion, a figure that could grow if there are cuts in federal funding.

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“We’re demanding a budget that serves the many and not the few, a budget that taxes the wealthy and not the working families,” said West Side resident and community organizer Crystal Gardner.

Last year, Johnson broke a campaign pledge and proposed a $300 million property tax hike. But facing objections, he took it off the table in favor of fee increases, cuts to unfilled positions and debt restructuring.

READ MORE | Chicago Mayor Johnson sends aldermen letter ahead of earlier budget talks, reluctant to make cuts

With the mayor determined to preserve investments for the unhoused and those needing mental health support, along with youth employment programs, he may again ask taxpayers to dig deeper.

“If we’re looking at a budget gap that’s grown by, say, $600 million to $700 million, I would think that’s the property tax hike that he’s going to ask for. It is going to be pretty painful for taxpayers,” said 32nd Ward Ald. Scott Waguespack.

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After the mayor was criticized last year for failing to engage stakeholders, he formed a working group in April that will deliver budget recommendations by the end of August.

A balanced budget must be passed by the end of the year. Overreliance on one-time revenue could lead to another credit downgrade for the city.