Group warns real costs to taxpayers
often obscured from government budgets
Shutterstock photo
Chicagoans
are on the hook for more public debt than residents of any of the nation’s 10
largest cities even though the total cost of the city’s debt is less than many
others.
According
to a new report by Truth in Accounting, Chicago’s debt burden is a little more
than $45,000 per taxpayer. That’s much less than the city of New York. But if
you add the burden from all of the other units of government, Chicago schools,
the park district, and many more, the total taxpayer burden is $125,000, much
more than the Big Apple.
Of that
added burden, more than $50,000 comes from the state of Illinois’ pension
burden, estimated at anywhere from $140 billion to as much as $250 billion.
Other debt is couched in the total debt of Chicago Public Schools, Cook County,
and other smaller levels of government that are able to take on debt.
Bill
Bergman, director of research with Truth in Accounting, says this allows
Chicago and other cities to say they’re budgets are balanced when they’re
highly leveraged.
“It
allows them to balance budgets on a cash basis when they’re accumulating debt
and spending more money than they take in,” he said.
Illinoisans
should be concerned about their largest city carrying too much debt, Bergman
said, because it could end up coming out of the entire state’s budget in one
way or another.
“Chicago
may have to rely on taxpayer money from, say, Kankakee in order to close their
books,” he said.
The
Governmental Accounting Standards Board is currently debating an initiative to
force cities to factor in their debt when filing their annual budget reports,
or accrual accounting standards.
Meanwhile, a bill on Gov. Bruce
Rauner’s desk would allow local governments in Illinois to use another method
of budgeting that solely factors cash on hand in their accounting.
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