Story URL: http://news.medill.northwestern.edu/chicago/news.aspx?id=208947
Story Retrieval Date: 5/20/2013 12:47:22 AM CST
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Businesses give thumbs up on mayor’s budget
by Margaret Sutherlin
Oct 10, 2012
Mayor Emanuel has business on his mind
-No increase in sales, property, amusement or fuel taxes-Further reduction in city-wide $2 per employee head tax
-Create small business center to ease licensing and startup process
-Contribute additional $15 million to city's "rainy day" fund
-Reduce annual building inspections by 70 percent through streamlined task-force model
Emanuel discussed several specific goals for the 2013 budget, among them a renewed emphasis on trimming City Hall fat and streamlining bureaucracy. The mayor also announced plans to develop a small business center aimed at helping entrepreneurs launch their businesses by simplifying the licensing process and helping them find loans.
Even with a $300 million budget shortfall and underfunded city pensions, Emanuel promised no tax increases and emphasized the importance of new business to Chicago’s overall economic health. “Small businesses account for nearly half of all the jobs in Chicago. But too often, City Hall is a problem for small businesses, not their partner,” he said.
Padraic Swanton, spokesman at the Lincoln Park Chamber of Commerce, said many of the moves proposed by Emanuel were on the right track to support local business growth.
“Anytime you present a budget without fees or taxes it helps us for prospective businesses compared to others in the region,” said Swanton. “It just seems like the city is saying ‘We’re open for business.’”
Among the obstacles facing business owners in the city is an employee head tax, which charges those with more than 50 workers $2 per employee per month. The tax is less than hospitable to large and small businesses alike, says Marc Gordon, president of the Illinois Hotel and Lodging Association.
In July, Emanuel cut the head tax by half, and he proposed a further unspecified reduction in his budget presentation Wednesday.
“The head tax reduction sends the message that we do not want to penalize companies for hiring people,” said Gordon.
Sarah Wetmore, research director for the Civic Federation, a nonpartisan taxpayer watchdog in Chicago, was also generally pleased with the budget. But she stressed the importance of solving the pension-underfunding problem. While Emanuel has done much in his first year to help get the city’s budget deficit under control and grow revenue, there is still much left to be done, she said.
“Chicago’s pension crisis remains the most significant problem the city faces and is one that causes great uncertainty for the future of city services and tax levels,” Wetmore said in an email interview. “Mayor Emanuel and the General Assembly must work together to reform pension benefits so that pension promises will be sustainable to employees, retirees and taxpayers”
The budget now heads to the City Council for debate and approval.
