>> Chicago's 17.1 billion dollar spending plan is now in place for 2025, but it did not come easily forceful push pack push, push back from older people blocked property tax hikes.

But the budget still includes over 165 million dollars in additional taxes and fees to generate revenue.

Here to discuss what this could mean for residents, wallets and the city's fiscal future is and that Guzman direct budget director for the city of Chicago.

And that.

Welcome back.

Thanks for joining us.

Thank you for having me.

So last year's budget negotiations with City Council far less contentious than this year.

Why would this year so difficult?

You know, I think that.

>> You know, we are one of many municipalities states in this country that are facing difficult decisions that have to be made as we continue to emerge from the pandemic and a lot of the federal dollars that have really sustained and helped us recovery recover have started to expire.

And so as we look to what are the things that we want to prioritize for communities, one of the things that we need to expand because of threats that might be coming from incoming administration's these are the difficult conversations that the fortunately or unfortunately one of the first to have Mayor Johnson for said that when he first proposed that property tax hike that it was a very difficult decision made after an excruciating process.

>> He later said that his proposal was designed to get older people's attention.

Why not start the process behind closed doors?

Were some of that ugliness can be worked out rather than proposing publicly an unpopular idea.

>> You know, I think, you know, you know, hindsight is 2020 and a lot of cases.

And, you know, we did have a lot of conversations with Alders before the mayor introduced his budget.

You know, there are a lot of things that we have to hold in balance when having discussions about budgets, having discussions about services to provide to communities having discussions about priorities for not only next year, but you know, 5.10, years from now.

And, you know, with season that for me starts in January.

You know, those conversations start in earnest, but a lot of times because of the many things that we're balancing, it does take, you know, the introduction of the budget, sometimes to have some of those conversations earnest.

I will say that, you know, the the introduction of a property tax to begin with was one that was made based on what we're looking at, you know, out years as well.

You know, because we are mostly governed with revenues that are under state law.

We have a subset that we can put in place under home rule authority.

You know, we're always looking to, you know, the most stable of a revenue that in out years we can depend upon revenues that are gonna come in and property taxes are the most stable for municipalities to put in place.

So that said the budget did pass this week without that property tax, but an increase in multiple other fines and fees, for example, streaming and cable services.

>> Parking garages ride, hailing surcharges and then some cuts for some from some other places getting organizers of special events, for example, to pay the Chicago Police Department for over time, cutting 10 deputy mayors from the mayor's office.

Are you concerned that people will consider this array of smaller taxes in fee hikes just as difficult as one larger increase.

You know, when worked with Alders because these were identified through conversations with members of City Council to replace the 300 million Dollar property tax.

You know, we look all of our revenue sources to see when was the last time that we looked at.

It was the last time that we touched it.

And how is the economy changed since that time?

A lot of these had not been looked at over a decade and yet the price of goods and services has gone up.

And the city despite having 2, you know, administer a number of programs had not had its revenues grow at the same rate as some of the costs that it takes to actually administer those programs.

And so in conversations with members of City Council, they asked the question, you know, which ones are the ones that we haven't touched that we haven't looked at in a long time.

And is there room based on where the economy has has grown or changed for us to make some changes, whether small or to to bring in more revenue.

And so that's how this kind of slate of additional revenue sources came about.

Now the city is on watch list for credit rating downgrade.

How concerned are you about that?

I think I think any municipality be concerned about a downgrade because it goes towards how expensive your debt might be.

And for city of our size where we have a lot of infrastructure projects that are necessary to ensure that, you know, our communities are safe from public safety standpoint that, you know, we are able to develop our communities to incentivize businesses to calm you know, set up shop in and help that community thrive.

We're always concerned that we have the necessary resources to do that.

You know, we've we are talking pretty regularly with our credit rating agencies helping them to understand how so much of what we did is structural in nature, meaning that these are revenue sources that will be available to U.S. year after year and that these are not those one-time fixes that are delaying putting off costs into into the future.

And so those are the same arguments were going to be making to our rating agencies that, look, we did a lot be cut over 300 million dollars of expenditures out of this budget.

We raise over 400 million dollars, actually, you more than that in this budget of additional revenue so that we can make sure that these types of structural imbalances don't continue into the future.

The city Council narrowly passed this budget.

27 to 23.

What do you take away from that?

I take away that we have some additional conversations that we have have in the next year helping members of city Council understand where this where our financial trajectory is going helping.

Then have those conversations in their communities, especially helping our residents understand the value of government in their day-to-day lives.

You know, lot of people don't have a sense every day every single thing that the government is providing in their communities.

But once those things are not there, they realize how much they depend upon And so I think it's incumbent upon us whether it's the mayor's office or members of City Council to always help them and help our committees understand these are the things that we provide.

And these are things that we're happy provide.

We want to provide because we know how they contribute to the the thriving nature of our communities.

Just 30 seconds left.

How are you ensuring that you are not an even more difficult position this time next year?

I think it's beginning this process a lot earlier next year.

You know, we developed a forecast, its multi-year nature.

And so what we did this this year will