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Gery Chico: Stop raiding reserve funds to balance Chicago budget

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below, from Chico-for-Chicago-mayor campaign.....

Chico urges action on parking meter money

Citizen ordinance would guard against misuse of long-term reserves

CHICAGO: As Chicago received yet another bond rating downgrade this week, Gery Chico filed a citizen ordinance aimed at protecting the city's long-term reserve funds and helping to restore the city's bond rating.

The "Chicago Taxpayer & Credit Protection Ordinance" would prohibit the City from using long-term reserves to balance the budget. The raiding of Chicago's reserve funds has been cited by all rating agencies as a key contributor to the downgrade of Chicago's bond rating.

"In 2008, our city missed the mark when it agreed to the parking meter deal. To add insult to injury, we barely have anything left to show for it," Chico said. "Putting the city on the path to fiscal responsibility starts with protecting our long-term reserve funds. We must act now."

Chico's ordinance would establish two irrevocable trusts to hold the remaining $500 million Chicago Skyway reserve and the expected $76 million parking meter reserve intact. The trusts would protect taxpayer money.

All interest accrued from the Chicago Skyway trust would be used to pay city operating expenses. Current interest accrued from the parking meter trust would be used to replenish the fund until it reaches its original amount of $400 million.

The ordinance sets a new standard for accountability, calling for the City to set aside $16 million each budget year for the next 20 years, or until the parking meter trust is restored to the minimum reserve level of $400 million, the original amount promised for long-term reserves.

"Even in tough times, we must make good on our promises to the people we represent," Chico said.

Chico confronted similar structural deficits and low bond ratings when he served as president of Chicago Public Schools. He initiated broad reforms that transformed a $1.3 billion deficit into a $336 million surplus and achieved more than 12 bond rating increases.

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Lynn Sweet

Lynn Sweet is a columnist and the Washington Bureau Chief for the Chicago Sun-Times.

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This page contains a single entry by Lynn Sweet published on November 10, 2010 11:24 AM.

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