City of Chicago facing a $32.5 billion financial hole

A new analysis by Truth in Accounting, a non-profit government finance watchdog group, found the city of Chicago needs $32.5 billion to pay its bills—a burden that equates to $36,000 for each city taxpayer.

At the end of the 2017 fiscal year, Chicago had $41.9 billion in bills and roughly $9.4 billion in available assets to pay those bills after capital and restricted assets were excluded. The result is a $32.5 billion shortfall and a $36,000 Taxpayer Burden™, which represents each taxpayer's share of city’s unfunded debt after the city's available assets have been tapped. TIA's Taxpayer Burden indicator incorporates both assets and liabilities, not just pension debt.

Chicago’s Taxpayer Burden seemingly improved compared to the previous year when it stood at $45,200, in large part because the Municipal Employees’ Annuity and Benefit Fund of Chicago revised its investment return assumptions, which significantly reduced the amount of unfunded retirement liabilities on the books.

Overall, the city’s unfunded retirement obligations have decreased by $7 billion since 2016.

The bottom line: Chicago needs $32.5 billion to pay all of its bills, or $36,000 from each taxpayer in the city, which is why it received an "F" grade for its fiscal health.

You can find the full report here.