City Council’s June meeting was one for the history books. We break down how Mayor Rahm Emanuel and Ald. Ed Burke tried to adjourn the meeting early to stop aldermen opposed to Uber regulations, why 13 voted against a TIF subsidy for an Uptown development, and why some are sick of last minute changes from the administration.

On Wednesday, City Treasurer Kurt Summers proposed an ordinance to City Council that would impose striking new changes to the city’s investment policy allowing the City of Chicago to purchase debt issued by sister agencies like Chicago Public Schools. 

The proposed changes, introduced by Mayor Rahm Emanuel at the request of Treasurer Summers, would allow the city to invest in “tax anticipation warrants, municipal bonds, notes, commercial paper or other instruments representing a debt obligation” from sister agencies, including the Chicago Board of Education, the Chicago Housing Authority, the Chicago Park District, the Chicago Transit Authority, and the City Colleges of Chicago. Officials from the Treasurer’s office would not comment on the record about whether the move was designed to float CPS during its fiscal crisis. 

For the city to invest in bonds for the state, any other county, township, or school district outside of Chicago, the bonds must meet certain requirements, including a rating of at least A-, a maturity of no more than 30 years, and cannot exceed 25% of the total holdings across all funds. The same limitations would not be true for sister agency investments, according to the new proposed rules. 

The Board of Education’s most recent ratings from Moody’s are four levels below junk status, which led to an extraordinarily high 8.5% interest rate when it hit the open market in February. 

According to the same official from the Treasurer’s Office, there are no limits to the type of sale either, meaning the city can also buy the debt through a private or “over the counter” sale, rather than just on the open market. CPS would be able to issue debt of its own, at potentially a much lower interest rate than the open market would fetch, because it could have a guaranteed buyer in the City of Chicago. 

This introduction comes the same week that Governor Bruce Rauner has again pushed for the state to authorize bankruptcy for CPS.

This move could mirror another major municipal bailout. In 1975, triggered by a fiscal crisis in the City of New York, the Teachers’ Retirement System of the City of New York and four other municipal pension funds agreed to buy $2.53 billion in city bonds over roughly two years to avoid bankruptcy for the city. At the time, New York’s Board of Education was short $268 million, and was forced to lay off about 14,000 teachers and 7,000 other educators. Then-Gov. Hugh Carey pushed the State Legislature to set up the Municipal Assistance Corp (jokingly referred to as Big MAC), which sold bonds on behalf of the city, backed by New York City’s sales and stock transfer taxes. Just as the city was on the brink of default, the United Federation of Teachers, the teacher’s union, agreed to furnish $150 million from its pension fund to avert the crisis. 

The Chicago Treasurer’s office was unable to immediately report on the current liquidity of its long-term investments yesterday evening, but according to the Treasurer’s most recent quarterly earnings report, the city has over $4.75 billion in long-term investments (commercial paper; corporate, municipal, and agency bonds), and $1.3 billion in short-term investments (certificates of deposit, money market funds, and cash).

The other proposed tweaks to investment policy would also allow investment in mortgage backed securities, under certain circumstances, and changes the classes of assets the city can invest its cash in. 

According to City Council's Financial Analyst, Ben Winick, the proposed changes limit the kinds of corporate bonds the city can buy: companies must have assets of at least a billion (the previous ordinance was $500 million), and the city's portfolio will be made up of fewer corporate bonds: it's now limited to 25% instead of 30%. The city would also be allowed to purchase mortgage backed securities as part of the asset portfolio. Investors can receive interest and principal payments made on mortgages that have been packaged together.

Those in the Treasurer’s office authorized to execute investment transactions must sit through an investment training session within the first year at the job, and an extra ten hours of instruction on “investment controls, security risks, market risks, diversification of investment portfolio and compliance with applicable laws.” 

The changes “increase investment security by ensuring that the corporations we invest in are well capitalized,” spokesperson Alexandra Sims with the Treasurer’s Office said. The changes would also “enable investments in Chicago.” Though no details were provided in the ordinance itself, Treasurer Summers previewed the creation of a $100 million local investment fund, “a free-standing, independent non-profit investment vehicle comprised of capital from a variety of sources including institutional investors” aimed at providing capital to small businesses and real estate developers.

Ald. Ed Burke (14) calls for a surprise vote that impacts millions of dollars worth of city contracts (and helps him look tough on business during a bad week of Donald Trump headlines), while Ald. Anthony Beale’s (9) strict rules on ride-share companies passes through committee in about five minutes. Both signal the Mayor was having a tough week winning over aldermen. And after a nearly three year fight and despite pressure from business groups, workers win five days of paid sick leave. 

Ald. Anthony Beale (9), the main architect behind a contentious plan to require that Uber and Lyft drivers get a special license from the city and be fingerprinted by an outside contractor chosen by the Chicago Police Department, remains confident he has the votes to get his original plan through the Council, even as aldermen and mayoral staff held last minute meetings yesterday to propose alternatives.

And it looks like he’ll be getting what he wants. One source close to the ongoing negotiations told Aldertrack last night that after a five and a half hour private meeting with all parties yesterday, no changes were made to the original ordinance.

“I think we’re very far apart,” Beale told Aldertrack before the meeting yesterday afternoon, emphasizing he would still meet with taxi, rideshare, and administration representatives to find a compromise. But Beale touted a strong list of co-sponsors and repeated a familiar line: “I’m standing firm on my entire ordinance.” As chair of the Transportation Committee, he could potentially halt consideration of an introduction or substitution from Mayor Rahm Emanuel.

Beale is co-chairing today’s meeting with License Committee Chair Emma Mitts(37). He says he will not allow further public testimony today, limiting the meeting to only expert witnesses and a vote. The last hearing elicited raucous calls from the audience–a mix of Uber, Lyft, and taxi drivers–with some shouts at aldermen.

Uber has lobbied its drivers to come out in full force today, asking them to attend an 11:30 a.m. press conference, where they’ll provide food, t-shirts, and $25 for parking. The email to drivers warned, “Under [Beale’s] rules, you’d be required to take time off work to obtain a pricey chauffeur's license, go to class at Olive Harvey Community College, and pay hundreds of dollars in new fees just to get on the road.” The email links to eight steps drivers would need to take to receive a city license, which Uber says would take weeks and require hundreds in out of pocket costs for drivers. This afternoon, Lyft sent out a similar call to its drivers, and is planning an 11:15 a.m. press conference.

But Beale estimates support for his ordinance is stronger than anything the Mayor could drum up. “I’m very confident that I have a huge margin of votes,” Beale told reporters yesterday. As it stands today, 32 aldermen support Beale’s ordinance. 20 out of 29 joint committee members are sponsors.

One alderman, Brian Hopkins (2) requested to be removed as a co-sponsor of Beale’s ordinance on Wednesday. Hopkins didn’t return requests for comment about why he changed his mind. But Aldertrack has been told that Uber is actively lobbying aldermen to flip their votes. Beale’s co-chair, Ald. Mitts, in a rare social media statement on Facebook, wrote on Tuesday: “For the record, I am in support of Ride Share Companies such as Uber and Lyft. They provide jobs and service for the residents of the 37th Ward. I stand behind them and in favor for keeping them in the city.”

According to City Hall sources, Uber and Lyft had been pushing aldermen to amend Ald. Beale’s proposal so that the licensing requirement would only impact full time drivers. Representatives from both platforms have said that at least two-thirds of their drives are on the road only a few months at a time, usually when they’re strapped for cash.

Under the companies’ proposal, drivers who are on the road for 40 hours or more for 12 consecutive weeks would only be required to get the license, which they want to be in charge of administering, not the city. The Mayor’s office was rumored to want full time to be considered 30 hours. Neither company wants their drivers to get city-administered fingerprinting, drug tests, and a background check that would determine if the driver owes money to the city.

But it looks like Uber and Lyft have chosen not to push back on a requirement that would mandate that at least 5% of their fleet be wheelchair accessible.

If Beale is correct about his overwhelming support and the measures pass City Council, a veto from Mayor Emanuel might make him appear to favor his brother, Ari Emanuel, an Uber investor.

The Illinois Supreme Court rules a state pension reform law is unconstitutional, forcing Mayor Emanuel to find a new way to fix its struggling Municipal and Labor funds. Aldermen with the Black and Latino Caucus call for public vetting of the three finalists for the city’s top cop vacancy. IPRA’s new chief orders an external audit of closed police involved shooting cases dating back to 2007. And the Chicago Teachers’ Union authorizes a strike. 

A substitute ordinance changing nudity rules and allowing strip clubs to serve alcohol will be introduced by License Committee Chair Emma Mitts (37) in Wednesday’s Council meeting, following her move to defer and publish a previous version of the same ordinance at April’s Council meeting. The previous D&P of the strip club ordinance, which included Zoning Chair Danny Solis (25), allows Mitts to force an up or down vote on her latest substitute, which has gone through a number of revisions in the last month.

Under Ald. Mitts’ most recent substitution circulated on paper yesterday, strip clubs would be allowed to purchase a two-year $75,000 license for the privilege of serving alcohol and having their dancers perform topless. Excruciatingly specific language in the substitute would allow use of only g-strings in clubs that serve alcohol. Current zoning code bans alcohol, but allows BYOB (bring your own bottle), and dancers are required to cover parts of their breasts and buttocks.

“The problem is they bring their own bottle,” Ald. Mitts told reporters yesterday. “What is that? That means you can drink [there]. Why not regulate them...license that establishment, get some money for that liquor license.”

But opponents of the changes charge that selling more alcohol in the clubs will only fuel violence against the dancers.

“The level of nudity in the strip clubs is not the source of our opposition. It’s the introduction of alcohol,” said Lynne Johnson, Policy Director of Chicago Alliance Against Sexual Exploitation (CAASE).

“As the night wears on, the patrons are getting drunker and drunker, [the dancers] are getting hit, slapped, called names. Many are in back rooms and no one can hear them because the music is so loud and they have very few people to protect them,” Johnson said at a press conference yesterday morning attended by Alds. Patrick Daley Thompson (11), Toni Foulkes (16), Matt O’Shea (19), Michele Smith (43) and James Cappleman (46).

According to the new version of the ordinance, all revenue derived from the new “live adult sub-use license” fee will be set aside in a special fund to support services for victims of domestic violence, sexual assault, and human trafficking.

“Domestic violence providers are not interested in cash resulting from strip clubs. Allowing sexual exploitation in return from cash from strip clubs is not OK,” said Johnson.

Mayor Rahm Emanuel speaks at a press conference on January 13, 2016.

On December 9, 2015, in a rare early morning speech to the City Council after protests against police brutality had engulfed the city, a teary-eyed Mayor Rahm Emanuel addressed growing demands for police reform, saying, “We can either be defined by what we failed to do or what we choose to do.”

“We have to be honest with ourselves about this issue,” Mayor Emanuel told a packed City Council Chamber ahead of the last Council meeting of 2015. “Each time when we confronted it in the past, Chicago only went far enough to clear our consciences so we could move on.”

In this week’s episode we talk about Chicago Public School’s dire financial situation. Officials at CPS briefed aldermen this week to tell them they expect to finish the school year with only enough cash on hand to cover one-and-a-half days of operations. Meanwhile, the Chicago Teachers Union, still without a contract, announced $502 million in possible revenue ideas. And Mayor Emanuel gives a keynote address to the National Federation of Municipal Analysts.

Chicago has a new Police Superintendent, Eddie Johnson, and 4th Ward Alderman, Sophia King. As the Council approves both, a scathing task force report takes on the CPD over racist policies, and aldermen vote to settle two police-involved deaths totaling nearly $7 million. We’ll look at a couple introductions reforming the department, and an upcoming report that will impact the contract fight between Chicago Public Schools and the teacher’s union.

A South Side alderman announces a plan to to abolish the Independent Police Review Authority (IPRA). Aldermen relax a parking ban on pickup trucks, while loosening liquor regulations at nude strip clubs. And we detail paid sick leave recommendations from a mayoral task force, an industrial zoning plan, and some big items slated for next week: millions is police settlements, a new 4th Ward alderman, and a plan to amend city law and appoint Eddie Johnson as the next Police Superintendent.