Why is Chicago borrowing hundreds of millions of dollars each year? Concept Introduction: Chicago Financial Crisis - Chicago has dug itself into a massive financial hole. The innovative borrowing tools that helped New York narrow the widening chasm between the revenues and spending is being used by Chicago to delay the necessary budget reform particularly the retirement benefits of the public sector workers. The city debt has increased from $12.3 billion in 2000 to $20.2 billion in 2017 with the per person debt increasing from $4,400 to $7,500 during the same period. It owes a $30.5 billion to the pensioners currently as against $5 billion in 2000. The city has fewer funds set aside in the pension fund today than in 2000. The fund's investment earning is far below the payout pegged at 25 percent funded.

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Chapter 6, Problem 1CTQ

To determine

Why is Chicago borrowing hundreds of millions of dollars each year?

Concept Introduction:

Chicago Financial Crisis- Chicago has dug itself into a massive financial hole. The innovative borrowing tools that helped New York narrow the widening chasm between the revenues and spending is being used by Chicago to delay the necessary budget reform particularly the retirement benefits of the public sector workers. The city debt has increased from $12.3 billion in 2000 to $20.2 billion in 2017 with the per person debt increasing from $4,400 to $7,500 during the same period. It owes a $30.5 billion to the pensioners currently as against $5 billion in 2000. The city has fewer funds set aside in the pension fund today than in 2000. The fund's investment earning is far below the payout pegged at 25 percent funded.

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