The 2023 budget is a sound and solvent plan for the future of Chicago and I voted in favor of it this week.
With our funding approach we reach people most in need and provide for small businesses that are the backbone of our local economy, and started with a full plate of community based ideas that bolster support for communities and the people of our City. The 2023 Budget does not include any new or increases to taxes and foregoes the CPI increase for property taxes.
The City budget continues to strategically invest in building a safer, more equitable Chicago. Investing in the areas of the city that for decades have been divested from is essential to get all parts of our City working together, built up and contributing to a healthy tax base.
We have also been working toward structural solutions to improve the health of the City’s pension funds. Our Budget continues this progress with $242.0 million in advance payments towards future pension contributions, on top of the City’s regular pension payments. This reduces future costs for pensions, freeing up money for more services while it improves fiscal footing of the city, increasing bond rating and reducing borrowing costs. Ratings agencies have confirmed this and have subsequently given us a healthy ratings boost for the first time in years.
This new pension funding policy is expected to reduce the City’s future pension contributions by $2 billion over time and avoid approximately $30 million in market losses due to liquidations this year. This week, the City secured its first Moody's investment grade upgrade in twelve years. On top of that, Moody's also upgraded a few of the City's bonds meaning that these upgrades in total is expected to save the City significant money and helps put us on a path toward financial recovery. For details, read the press release here. These upgrades are due to the sound financial policies that have been instituted over the past three years, and after the passage of the 2023 city budget that ratings agencies look favorably on.
A couple weeks ago, FITCH upgraded the City’s general obligation credit. The financial accomplishments over the last 3-years and the FY2023 budget we vote on today is the reason for this. We earned this upgrade and continue this with continued collaboration and sound fiscal management.
The budget allowed us to create a 12 week paid parental leave for employees, and will help keep young employed workers in the City and supports our families. This is especially important as the City sees huge vacancies across the board from retirements and people looking to retire early or find a less stressful way of life post pandemic.
Funding for mental health services has increased, and we look to increase the effectiveness of the police department working with social workers to address people in crisis.
Affordable housing expansion is moving in the right direction with $1 Billion in affordable housing development currently in the pipeline, 2,500 new and preserved housing units.
The budget also includes $3 million for reproductive health access while many parts of our country roll the clock back on these rights Chicago is investing and supporting women.
Following the consent decree, means more funds for better training of hundreds of new officers in the academy pipeline. We also have new vehicles and helicopters in the budget to reduce downtime. We also have budgeted improvements to City first responder facilities for the safety and welfare of officers and workers in these buildings.
We will have an office to address environmental issues called the Office of Climate and Environmental Equity - Equity addressing problems that have persisted for decades and allows us to work with community groups and organizations like IEC to address these concerns head on. is now on the right footing. During the past three years there have been many strides made in changing old systems wasting millions and negatively affecting our environment. I see us making significant changes in years to come. This year we have passed legislation and worked with the Lightfoot Administration to have 70% of all City-purchased electricity from renewable resource by 2025. We've signed agreements for massive solar projects in area.
We are in the process of planting 75,000 trees within three years that help in beautifying neighborhoods, mitigating the urban heat island, and absorbing CO2 within Chicago.
Amidst all the clamor of the pandemic and thereafter, we have a sound and strong budget here to vote on today.
Finally, I want to say a thank you to the Lightfoot Administration’s women who led us on this challenge City Budget Director Susie Park, City Chief Financial Officer Jenny Wang Bennett and City Comptroller Reshma Soni. They are a few of the highly professional financial experts in local government who combined their experience to navigate this pandemic recovery and put us on a strong financial footing.