The City of Chicago’s FY2027 budget process is now underway, with the Mayor expected to introduce a proposed budget to the City Council in October. The process began with the release of the City’s Budget Forecast, which provides the first detailed look at the financial challenges facing the City in the coming fiscal year. The forecast projects an $882.4 million budget deficit for FY2027—nearly $…
The 2026 Chicago City budget authorized video gaming within the City of Chicago (Chicago or the ‘City’) and relied on the projected revenue from licensing fees to help balance the alternative budget ultimately passed into law in December 2025 by the City Council without the signature of the Mayor. Since passage, the video gaming revenue has been the subject of recurring debate and controversy…
Property taxes are the largest single source of state and local government revenue in the United States and are especially important for funding local services such as public education. Their high visibility and sensitivity to rising property values, however, make them politically unpopular, particularly when tax bills increase faster than household incomes. In response, most states have adopted…
Chicago's budget debate has increasingly focused on whether the City should adopt stricter standards for structural budget balance and long-term financial planning. New York City provides one example of a major U.S. city operating under a more rigorous legal framework. This report examines how major U.S. cities prepare budgets and compares Chicago’s flexible budgeting with New York City’s…
The Civic Federation's Spring Speaker Series brought together Justin Marlowe, Research Professor at the University of Chicago Harris School of Public Policy; former 46th Ward Alderman James Cappleman; and 9th Ward Alderman Anthony Beale for a candid panel discussion on Chicago's fiscal condition and the path forward. Moderated by Don Vincent of The Daily Line, the conversation examined lessons…
The 2026 edition of this annual report lists and describes selected consumer taxes within the City of Chicago (Chicago or the ‘City’), effective as of January 1, 2026. Consumer taxes are taxes imposed on the purchase, use, or consumption of goods and services by individuals and businesses. They are generally paid by the end user, either at the point of sale or through charges embedded in the…
TIF is a tool used by local governments, like cities, towns, or villages, to boost their economies and pay for redevelopment projects in specific areas. Governments do this by taking property tax revenue above a set starting point and reinvesting it back in the same area. The goal is to encourage development that would not happen without this public funding.
Tax Increment Financing, or TIF, is one of the most widely used—and often misunderstood—economic development tools in Illinois. With approximately 1,488 active TIF districts across 511 municipalities in Illinois as of 2025, TIF plays a significant role in shaping local investment, property tax dynamics, and public finance. This primer explains how Tax Increment Financing (TIF) operates in…
Legislative deliberations over the City of Chicago's (Chicago or ‘the City’) FY2026 budget, which ran from mid-October through passage in late December 2025, were a contentious, opaque, and at times messy affair that laid bare what has long been a deeply flawed process. In the absence of formal structures, procedural rigor, sufficient technical resources and expertise, and standards-based…
The final FY2026 City of Chicago budget, passed by City Council on December 20, brought a conclusion to an unprecedented and complex budget season. The result, which took effect January 1 without a signature or veto from the Mayor, should leave Chicagoans expecting much better of the City Council and Mayor alike. The unprecedented City Council-generated alternative FY2026 budget, while a valiant…
