Mayor Brandon Johnson's plan to help Chicago combat homelessness by raising taxes for the city's real estate transfers will go before voters on the March 2024 ballot.
The Chicago City Council approved the "Bring Chicago Home" measure, 32-17, on Tuesday, which would shift the flat tax rate to a three-tiered system. Owners of properties below $1 million will actually see lower tax rates, with the rate dropping from 0.75% to 0.6% from Johnson's original proposal. On the other hand, owners in the second and third tiers — with properties between $1 million and $1.5 million, and properties above $1.5 million — would see their tax rates increase to 2% and 3%, respectively, the latter being quadruple the current rate.
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Advocates of the "Bring Chicago Home" initiative say the proposal will alleviate burdens on property owners and smaller multifamily buildings while also aiding the city's rising homeless population. It is projected to take in more than $100 million in revenue per year, which is $60 million less than the original proposal's prediction.
“I am confident that the people of Chicago are going to say yes,” Johnson said at a Tuesday news conference after the council vote. “The people of Chicago had an opportunity to vote for someone else who wasn’t supporting this initiative. So if you’re asking me [about] my confidence, my confidence is as strong as the people who sent me to do the work.”
He added that the achievement was one that "many in Chicago thought was impossible" and predicted that voters will support the initiative in March.
With its addition to the ballot as a referendum, voters will get to decide whether this initiative becomes law in the spring's primary election. The referendum will ask voters for their approval on this tiered strategy that will funnel revenue toward “the purpose of addressing homelessness, including providing permanent affordable housing and the services necessary to obtain and maintain permanent housing in the City of Chicago," according to the Chicago Tribune.
The council had to approve the resolution, which was introduced to the governing body in September, before Jan. 3 for it to appear on the ballot.
The real estate industry is expected to be a vocal opponent of the measure. Critics have warned the tax change would put a further damper on an already fragile market for offices, retail, and apartment buildings, as well as drive up costs for tenants. Some aldermen had lingering concerns about the possible repercussions but ultimately decided that voters should have a say.
“There have been far too many people unhoused in Chicago, even before the buses arrived from Texas at an unrelenting pace,” Alderwoman Nicole Lee of the 11th Ward said during the council meeting. “It’s time to put this measure to the voters. ... To be sure, there’s work to be done on the final ordinance, should this pass, to acknowledge the impact on real estate and our still-recovering business corridor.”
Even the measure’s longtime champion in the City Council, Alderwoman Maria Hadden of the 49th Ward, said that “we’re going to have to keep talking about it” should voters agree in March the tax must be raised.
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The Chicago City Council's vote on Tuesday was a significant win for Johnson's administration, particularly after Johnson campaigned on a similar proposal during the mayoral election earlier this year as part of his 100-day promises once in office. The original plan called for two tiers instead of three: 0.75% tax on home sales below $1 million and 2.65% on properties above $1 million.
Johnson needed a victory on Tuesday, particularly after the fallout of one of his closest allies on the council. The mayor cast the tiebreaking vote on Tuesday to not censure Alderman Carlos Ramirez-Rosa of the 35th Ward. Ramirez-Rosa, the mayor's floor leader, announced on Monday he was stepping down from his leadership roles following an incident last week. During a regular City Council meeting, Rosa allegedly used his body to block Alderwoman Emma Mitts of the 37th Ward from entering the chambers minutes before a procedural vote on the proposal regarding Chicago's sanctuary city status.