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City Faces $996.6M In Long-Term Liabilities: Annual Financial Report

In all, the city has $30 billion worth of pension debt. “We are committed to putting Chicago’s house in order,” Mayor Lightfoot said.

Mayor-elect Lori Lightfoot.
Heather Cherone/The Daily Line
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DOWNTOWN — City officials faced an increase in long-term liabilities of $996.6 million as they begin to craft a spending plan for 2020, according to the city’s annual financial report for 2018 released Friday.

Of that increase, $558.7 million is due to increased post-employment liabilities on top of the city’s increasing pension debt because of a change in state law, said Chief Financial Officer Jennie Huang Bennett. 

The rest of that increase was created by the Sales Tax Securitization Corp., which Mayor Rahm Emanuel’s administration created last year to borrow against its sales tax receipts, as part of an accounting change, city officials said.

Huang Bennett likened those liabilities to a family’s total mortgage, car and student loan debt, which are set to be paid off over several decades.

In all, the city has $30 billion worth of pension debt, Huang Bennett said.

The 2018 Certified Annual Financial Report — along with finalized 2019 numbers — will help Lightfoot’s financial team craft a 2020 budget proposal, Huang Bennett said.

Former Emanuel faced a $635.7 million gap in 2011 after taking over from former Mayor Richard M. Daley.

In a letter released with the report, Mayor Lori Lightfoot acknowledged that the city was facing “extraordinary financial challenges driven by a legacy of pension liabilities, mounting personnel contract increases and growing debt service obligations — all of which are long in the making.”

Lightfoot said she and her term were hard at work developing “a sustainable roadmap for the future.”

“We are committed to putting Chicago’s house in order,” Lightfoot said.