Chicago budget 2026: Finance committee approves alternate plan without controversial head tax in Mayor Brandon Johnson’s budget

CHICAGO (WLS) — A Chicago City Council committee approved an alternative budget plan brought by a group of alderpersons on Tuesday.

A group of alderpersons presented the plan, which more than half of city council members are currently supporting, during Tuesday’s Finance Committee meeting.

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The substitute budget ordinance faced scrutiny from supporters of Mayor Brandon Johnson’s budget during the hearing, which lasted several hours.

The alternate budget group is looking to build support for their plan even as they put additional council meetings on the schedule, including meetings this weekend and on Christmas Eve.

The Finance Committee meeting revealed some new revenue options for the 2026 budget proposal and tweaked some others.

It includes raising the plastic shopping bag tax from $0.10 to $0.15, and a pilot program to put advertising on bridge houses as well as light poles.

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It officially gets rid of the corporate head tax, which has been a major source of contention since Johnson first presented his budget plan. The mayor and his allies are insisting that corporations pay more.

“What you have here is balancing the budget with fines and fees and taking out the corporate head tax. I want to hear your rationale to do that,” said 25th Ward Ald. Byron Sigcho-Lopez.

“Our proposal, in terms of new revenues, impacts businesses at 84% and individuals at 16%. I want everybody to take a look at this for a minute,” said Budget Committee Vice Chair Ald. Nicole Lee.

The alternative budget group says this plan is 98% in line with Johnson’s. Still, some of his allies were frustrated at not seeing the numbers sooner.

READ MORE | Chicago budget discussions reach stalemate, raising possibility of 1st-ever city government shutdown

“This is our first time reviewing this. This is incredibly disrespectful,” said 35th Ward Ald. Anthony Quezada.

There were also questions about the alternate plan to sell off outstanding debt to raise nearly $90 million. The city comptroller cautioned against it.

“I would say is that I would not. I would not rely on $89 million in this budget. This has never been done by any state,” said Chicago Comptroller Michael Belsky.

But supporters are defending this plan as worthy of consideration calling projections conservative and balanced.

“The group that’s worked on this has spent hundreds of hours bringing in the majority of the city council to talk about this,” said 19th Ward Ald. Matt O’Shea. “We relied on the advice and counsel of budgetary experts.”

The alternative budget plan passed out of finance committee 22-13. Its next stop is the Budget Committee on Wednesday.

It is clear that this breakaway group is flexing its muscle. What’s not clear is what the mayor’s next move will be.

But we now have city council meetings planned for Thursday, Friday, Saturday, and then, Tuesday and Wednesday of next week.

Johnson issued a statement on Tuesday evening, saying, “As the leaders of the Alternative Group made clear throughout their presentation, the Secret Budget that passed out of the Finance Committee this afternoon is substantially similar to the proposal we introduced more than two months ago.

At our insistence, the Alternative Group agreed to restore the cuts they made to youth employment, and they removed the proposal to double the garbage tax. They have finally conceded to some degree, the point that I have made from the beginning: that corporations must pay their fair share in order to protect Chicagoans at this moment.

Unfortunately, at the behest of certain corporate interests, they chose to replace a tax on the largest corporations with $90M+ in “enhanced debt collections” on everyday Chicagoans. This seems to be in direct contradiction with their expressed desires to shift the financial burden away from working people.

Not only is this proposal immoral, it is simply not feasible. There is no way to sell off Chicagoans’ debts that would yield that amount of revenue. If passed as is, this proposal would likely result in a significant midyear budget shortfall and leave Chicagoans vulnerable to deep cuts to city services.

We will spend the next few days with our budget, finance, legal, and policy teams reviewing these proposals. Chicago cannot afford a government shutdown when we are making so much progress growing our economy and reducing violent crime to historic lows.

Tomorrow, the Budget Committee will review their proposal publicly so that Chicagoans can understand exactly what is in this Secret Budget.”

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