Just when we thought we might never need to hear about the city of Chicago’s abysmal parking meter deal again, it was the subject of a Tribune editorial this week.
The financial investors who fleeced the city with a 75-year lease that cost them only $1.15 billion are adding insult to injury. They’ve made so much money, it turns out, they’re selling the remaining 57 years on the contract, possibly for billions more.
Billions more? Really?
Perhaps not. After all, purchaser Stonepeak Partners and the consortium selling the contract, Chicago Parking Meters LLC, are not disclosing the price tag. But we got a pretty good hint earlier this year when Mayor Brandon Johnson revealed he decided not to make a bid on purchasing the lease — at an offer price of around $3 billion. Ultimately, Johnson decided the city could not afford the buyout.
Why review this painful chain of events now? We’ve already learned so many hard lessons from the foolhardy parking lease. Haven’t we had enough?
Well, not really. It’s never too late to take lessons from the folly of taking major legislative action without a reliable assessment of what the bill might cost. The lesson is simple: Run the numbers, with care, before making an audacious fiscal bet.
It’s a lesson that might be applied, even now, to an unrelated piece of lawmaking that’s hurtling toward passage in the state legislature, which has been the talk of the spring legislative session: the megaprojects bill.
The megaprojects bill has emerged as Illinois’ best hope to keep the Chicago Bears in the state, Arlington Heights specifically, rather than seeing them move across the state line to Hammond. But it’s way bigger than that: Essentially, it would grant any developer with a project greater than $100 million the right to negotiate lower taxes, guaranteed for as many as 40 years, from local towns, school districts and other taxing bodies.
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Keeping the Bears in Illinois is a matter of pride for the state, and an urgent political consideration for Gov. JB Pritzker. Whether it amounts to a net fiscal win, or not, is anybody’s guess. And guessing is the best we can do since no reliable, independent cost-benefit analysis is on offer.
In short, the state legislature could be days away from passing a major new bill — with untold millions in potential tax breaks for the Bears and other potential mega developers and shifting the cost of those breaks to other property owners — without offering a meaningful analysis of the costs and benefits of the proposed law.
It doesn’t need to be this way.
In many states, the law requires detailed cost-benefit analysis on all bills with major financial implications for state budgets. Illinois has one such law, but it is full of loopholes that render it almost meaningless.
Illinois’ Fiscal Note Act calls for an analysis of a bill’s fiscal impact by state agencies likely to be affected. It also mandates study of the impact on local taxing bodies — highly relevant for the megaprojects bill, which could have its biggest impact on towns, school districts and such.
So far, so good.
But here’s the catch: The analysis is done in most cases only if the bill’s sponsor asks for it. And such requests rarely come.
Someone other than the sponsor can request a fiscal note, but one is included only after a majority vote of the relevant legislative chamber. Fiscal notes are added on amendments to a bill only upon the request of a majority of the committee — again, those virtually never happen.
A group called the Center on Budget and Policy Priorities, a liberal-leaning research shop, has a list of best practices: That all fiscally material bills be subject to a fiscal note, for example; that the analysis cover multiple years; that forecasts be updated as the legislation changes; that the reviewing body be nonpartisan; and that the fiscal notes be publicly available online.
The Fiscal Note law requires none of those practices.
The megaprojects bill’s chief House sponsor, Rep. Kam Buckner, D-Chicago, evidently determined that no fiscal note on the House version of the megaprojects bill was needed, since none was made. He did not respond to a request for comment on his decision.
It is expected the Senate version currently under discussion in Springfield, sponsored by Sen. Bill Cunningham, D-Chicago, won’t receive fiscal note review, either.
As a matter of politics, it’s not difficult to see why the legislature is not demanding a fiscal note for the megaprojects bill. With the threat of the Bears’ move to Indiana, the pressure is on — and Pritzker is calling for action, too.
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I argued previously for the legislature to split off the Bears’ tax breaks into a stand-alone bill and to take time for more careful, studied forecasts of how a broader version would affect towns, villages, school districts and taxpayers. At this point — a little more than a week before the General Assembly adjourns — such a move seems unlikely.
Instead, a bill likely will pass, and receive Pritzker’s signature, without a fiscal note to predict the bill’s potential benefits — or its costs.
Given the pressure of the Bears stadium and legislative momentum we have seen over the last few weeks, the General Assembly likely will pass a megaprojects bill before adjourning. Perhaps in the fall veto session, lawmakers can consider passing a bill that strengthens the Fiscal Note Act, so passing such a major bill with so little financial information doesn’t happen again.
David Greising is president of the Better Government Association.
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