Chicago voters reject property tax changes to fund homeless programs

Chicago voters rejected an increase in the transfer tax on valuable properties in a referendum on Tuesday, according to The Associated Press, reversing a long-standing goal of Mayor Brandon Johnson and progressive Democrats, who wanted to use new revenue to reduce homelessness in the third instead of tackling the country, remained unfulfilled. -biggest city.

The result came after days of counting ballots, including mail-in votes, that failed to be reported on Election Day.

Property groups had warned that the new rates would have been a potentially catastrophic blow to the city center office market, which was already losing value and struggling with vacancies.

The vote came at an uncertain political moment in Chicago, a Democratic-dominated city where homelessness has become more visible since the pandemic and an influx of migrants has strained resources. And the result raised questions about the strength of the city’s progressive movement, led by Mr. Johnson, who has become the dominant force in City Hall over the past decade and who has mobilized his army of volunteers to knock on doors in support of the tax change. .

“Yes, it’s a loss for Mayor Johnson and a loss for the progressive movement,” said Dick W. Simpson, a former Chicago City Council member and professor emeritus at the University of Illinois at Chicago, who campaigned for the tax change .

The referendum called for increasing the transfer tax on properties selling for more than $1 million, while lowering the rate on properties selling for less. Advocates described it as an opportunity to level the playing field and help the city’s most vulnerable residents. Some called it a “mansion tax,” versions of which have been approved by voters in Los Angeles and Santa Fe, NM.

“Homeless people are everywhere,” said Jason Rodriguez, 41, a Northwest Side resident who supported the tax change. “It’s just a common thing, but it shouldn’t be that way. No one should be without a home, without a place to sleep.” Mr. Rodriguez said tent camps had grown near his home.

Opponents of the tax agreed that homelessness is a problem, but they questioned the wisdom and timing of the proposed solution. Office tower owners are already feeling the pinch of the post-Covid shift to remote working. And the city is struggling to respond to the arrival of tens of thousands of migrants transported by bus or plane from the southern border to the Chicago area.

“It’s not a mansion tax, it’s an immigrant tax,” said Anthony Beale, a Democratic council member from the South Side who opposed the referendum. He said he believed this would hurt the local economy.

Homelessness has become a top issue in urban centers across the country in recent years, sparking a range of responses. In Minneapolis, where there are encampments cleaned up routinelyofficials declared unsheltered homelessness public health emergency. Sacramento experimented with giving one rental to a homeless camp. Austin, Texas, has been trying to build more tiny homes. New York City, where the number of shelters reached a record high last year, has placed limits on how long some migrants can stay in city facilities.

Despite this widespread concern, voters in some places are unsure about whether to approve more spending on homeless programs. Many observers expected California voters would overwhelmingly approve a ballot measure calling on the state to spend billions to expand treatment centers and supportive housing for people with mental illness and addictions. Although the measure did pass, it did so only narrowly, and the race was not called until more than two weeks after the election.

In Chicago, Debbie Daniels, 57, a retired accountant who lives on the Northwest Side, agreed that homelessness is a growing problem. But she said changing property taxes would ultimately lead to higher costs for renters like her. And if people can’t pay their rent, she said, it could lead to more homelessness in the future.

“The landlord is going to force this on us,” Ms. Daniels said. “If the tax passes, it’s coming. It goes to the tenants of Chicago, and we’ve always been here.

Different ways of counting the city’s homeless population have yielded vastly different estimates of Chicago’s problem. Annual city counting homeless people, conducted on a single day in early 2023, showed that approximately 6,100 people were living on the streets or in homeless shelters. The Chicago Coalition for the Homeless, a nonprofit that supports the tax change, estimated that about 68,000 people in the city were homeless in 2021, a figure that includes people living temporarily with others or “doubling up” in a unit where their names are not on the lease.

But those counts were done before most migrants arrived. On Monday, officials said more than 11,000 of the estimated 37,000 migrants who have come to the Chicago area since June were still living in 23 shelters run by the city or state. City officials began expelling some migrants from shelters on Sunday.

Progressives began pitching a version of their tax plan, which they call “Bring Chicago Home,” in 2018 during Rahm Emanuel’s tenure as mayor and continued to push for it throughout Lori Lightfoot’s four-year term. But it was Mr. Johnson’s election last year that enabled what supporters saw as an opportunity to reshuffle the city’s priorities.

“This will be a long time coming for the people of Chicago,” Mr. Johnson said in the weeks before the vote. “While two administrations were reluctant, or downright negligent, it’s a different day for Chicago. That’s a good thing.”

The voting question left open exactly how and to whom the new income would be spent. Even with the transfer tax reduction for properties selling for less than $1 million, supporters estimate the referendum would lead to at least $100 million a year in additional revenue for homelessness and affordable housing programs.