Chicago City Council. Understanding Chicago's Finance General Category 2023 Budget. (Victor Hilitski/BGA)

A yearly Chicago ritual is about to begin. Oct. 16 marks the start of two weeks of budget hearings, when department heads will appear before City Council to take questions about their administrative budgets, part of the city’s 2023 municipal budget cycle – the first under Mayor Brandon Johnson. 

As they are each year, these hearings are designed to hold each department accountable for its budgeted expenditures. But one pot of city money isn’t held to the same scrutiny: a catch-all category called “finance general” for budgeted expenditures not assigned to a specific department. 

A Better Government Association policy team analysis has found that over the past three administrations, an increasing number of appropriation items has been added to this category, significantly growing the portion of the city budget without direct departmental accountability from about one-third to nearly half of the overall city budget. 

Because no single department head is responsible for the finance general expenditures, those appropriations receive relatively little attention during the budget hearings, and are subject to minimal direct questioning or oversight from alderpersons as part of the public budget process.

The BGA Policy analysis of the finance general appropriations from 2011 to 2023 found that:

  • The overall budget for the non-departmental “finance general” category has risen from an inflation-adjusted $3.9 billion in 2011 to $7.8 billion in 2023.
  • Finance general as a percentage of the overall budget has also increased over time, from 33.3% of the budget in 2011 to 43.2% in 2023. A decline from the 2020 high point of 46.9%, driven by a massive influx of pandemic relief funds into the departmental budgets, has begun to reverse as federal dollars are spent, and the trend is once more upward.
  • The finance general budget has expanded to cover a wider range of individual expense categories over time, up from a low of 224 unique appropriation items in 2013 to 340 in 2023.
  • Many finance general appropriations are specific to only one or two city departments, rather than being true citywide or enterprise expenses. This disguises the true operational costs of some of the city’s largest departments, including the Chicago Fire Department, Chicago Police Department, and Department of Water Management.
  • Overall, the rising costs of the finance general budget are primarily driven by increases in pensions and benefits, bonds and loans payments and interest, and outside contracting, as well as the capital construction costs paid out of the water and sewer funds. 

Citywide Budget Category Grows

Since the end of the Richard M. Daley administration, the finance general category has grown both in inflation-adjusted raw dollar amount and in the proportion of the city budget dedicated to non-departmental expenses.

In the 2011 budget, the city appropriated $2.9 billion for finance general expenses ($3.9 billion in inflation-adjusted 2023 dollars). As of the 2023 budget, that number had increased to $7.8 billion.

Overall city budgets also have increased, but the share of the total budget dedicated to finance general expenses has trended upward over time, apart from a COVID-era dip driven by a massive injection of federal money into departmental budgets. As COVID relief programs began to allocate and spend down their federal funding, the percentage of the budget dedicated to finance general categories rose once more in the 2023 budget.

More Expenses Included Under “Finance General” Category

In theory, finance general appropriations are citywide expenses. Financing costs, including interest and payment of bonds and loans, are handled under the finance general header. So are pensions and benefits, a long-standing practice that obscures the true cost of each department’s workforce and that has been highlighted as a fiscal transparency concern by the Civic Federation in its annual budget analyses.

Over the years, however, an increasing number of appropriation accounts have crept into the finance general section of the budget. (Appropriation accounts are broad expense categories, such as “Payment of Bonds,” “IT Maintenance,” “Legal Expenses,” and “Postage.”) As of the 2023 budget, the finance general section includes nearly 350 unique appropriation items, a significant increase in complexity over the past decade.

Recent budgets have, in some cases, moved expenses relevant to only a few departments into the finance general category, making them appear to be citywide budget items when they are not. 

The fire facilities maintenance appropriation, for example, which supports the Chicago Fire Department’s budget rather than any general citywide expenses, has risen from a $5.5 million budget item when it first appeared in the 2020 budget to $13.5 million in 2023, all under the finance general heading rather than the CFD departmental budget.

Similarly, emergency response vehicle maintenance has been a finance general line item since 2020, up to $6.8 million in the 2023 budget, separate from the maintenance appropriations of the city’s emergency services departments and the Department of Assets, Information and Services, which maintains the city’s motor pool. 

The 2023 budget also included $4 million for consent decree spending, an expense directly related to the Chicago Police Department’s operations, and since 2015 there has been a multimillion dollar finance general line item for “Transfer for Services Provided by the Department of Police,” most recently $1.5 million in 2023. 

The city has budgeted $10 million for arts and culture initiatives under finance general over the past two years, rather than with the city’s Department of Cultural Affairs and Special Events. And since 2015, there have been finance general appropriations for delegate agencies – essentially pass-through spending that the city distributes to non-profits and other third parties providing services to residents – in addition to the hundreds of millions distributed as part of departmental budgets. 

The use of the finance general category for department-specific expenses reduces those departments’ budgets, obscuring the overall cost and cost-for-service calculations of the city’s operating agencies. In response to BGA Policy inquiries about department-specific items categorized as finance general expenses, an Office of Budget and Management spokesperson stated that finance general is used for both citywide expenses and for appropriations where the final cost is approximate but not yet fully known, resulting in some departmental appropriations remaining under finance general.

The Civic Federation, an independent research organization that provides analysis and recommendations on government finance issues for the Chicago region and State of Illinois, said it was not aware of a reason why single-department expenditures would be budgeted within the finance general section. “The City’s approach of grouping so many expenses together in finance general is problematic because it fails to provide a true accounting of how much it costs to operate each department,” said Sarah Wetmore, the acting president of the Civic Federation.

The group hopes to see the city adopt more of the accounting practices used in the Cook County budget: “In the past, Cook County also budgeted for certain costs including health benefits, insurance, real estate, IT licenses and utilities, centrally in a ‘fixed charges’ category of the budget. But over a period of several years beginning in 2016, the County shifted those expenditures into individual departments’ budgets in order to better reflect the cost structure of each office. This is a more transparent way to show the cost of employees and programs, and is considered best practice by the Government Finance Officers Association.”

Major Citywide Cost Drivers

Finance general is a top-heavy budget: roughly three-quarters of all spending in this catch-all category in recent budgets have been tied to its 10 largest appropriation accounts, with hundreds of smaller appropriations making up the remainder. 

The largest expense types primarily fell into four major appropriation categories: pensions and benefits, financing related costs, outside contracting, and water and sewer capital construction. 

Pension and finance-related costs make up by far the largest expenditures under the finance general umbrella, while outside contracting is smaller but one of the most rapidly-increasing appropriations in the category.

Pensions and Benefits

It’s hard to overstate the impact of annuity and benefit payments to retired city employees on the city’s budget. Other benefit costs also rank among the largest appropriations in the catch-all category every year, but pension payments are dramatically larger than any other finance general appropriation. Since 2011, the appropriation for annuity payments has increased significantly, from roughly $449 million in the 2011 budget to $2.4 billion in 2023. 

In addition to payments to beneficiaries, the finance general category also includes payments into the city’s pension funds. Beginning with the 2015 budget, under Mayor Rahm Emanuel, the city began budgeting for state-mandated payments into its various pension funds. Contributions were relatively flat during the five-year “pension ramp” from 2016-2021, but the law’s target of a 90% funded ratio by 2055 means the city faces ballooning, actuarially-calculated costs going forward, reflected in the 2022 and 2023 budget appropriations for municipal fund pension allocations. 

Mayor Lori Lightfoot’s 2023 budget included an additional $242 million advance contribution to the employee annuity and benefit fund, which was listed as a separate appropriation category. One of Lightfoot’s outgoing executive orders directed the Office of Budget and Management to create a separate pension advance payment fund with surplus from the 2021 and 2022 budgets – a move that would continue the practice of advance payments on pension obligations, but which potentially conflicts with City Council’s power of the purse, as previously reported by BGA Policy.

Healthcare costs also remain a major cost driver, though they are substantially smaller than pension costs in raw dollars. While the city has held HMO premiums relatively stable, claims and administration for medical care accounted for the largest non-pension benefit budget increase over the examined years, increasing from $244.3 million in 2011 to $353.4 million in 2023. 

Healthcare costs for current city employees had followed a relatively steady rise between 2011 and 2020, but after a dip during the pandemic lockdown era have begun to rise steeply. 


City finance costs fluctuate somewhat both in overall amount and in the specific appropriation accounts used as older financial vehicles mature and new ones are offered, but the overall picture is of increasing costs. Major financing-related appropriation items totalled $2.2 billion in the 2023 budget, roughly doubling since 2011’s $1.1 billion. 

Interest payments make up a significant portion of the city’s budgeted financing costs each year. In her administration’s final two budgets – when the city was flush with COVID-19 relief funding from the federal government – Lightfoot made substantially larger-than-usual bond payments, marking the first two years in recent history that the city’s budget for bond payments exceeded its budget for interest payments. 

In addition to the major cost-driver categories, bond fees and costs was the single fastest-growing category within finance general appropriations. Introduced in 2015, the category grew from $155,000 to $165,000 for two budget cycles, then leapt to roughly $9 million in 2018. It has fluctuated over the years, but the most recent appropriation for the 2023 budget was once again approximately $9 million. 

Outside Contracting

Pension and financing categories have been exclusively part of the finance general category since at least 2011, as far back as datasets are available. Individual city departments do not budget for expenses related to pension, bond or loan payments. Those categories are budgeted for only as citywide expenses. 

One of the largest categories within finance general, however, is also shared by most city departments: outside contracting, as reflected in the “professional and technical services” appropriations account. Since 2011, the city’s annual budget for non-department-specific contractors has ballooned from $28.4 million to $151.2 million – a roughly 433% increase, making it one of the fastest-growing categories as well as one of the largest. 

The Department of Procurement Services, which maintains records of city contracts, does not use the “finance general” category in its department field. Contracts are assigned a parent department regardless of budgeted funding source. According to an Office of Budget and Management spokesperson, finance general contracting appropriations are largely used to fund civil service exams, which are administered by the Department of Human Resources on behalf of multiple city departments. Because the exact number and type of exams varies from year to year, the expense category is treated as a citywide expense rather than being broken out by individual departments. 

Capital Construction

Prior to 2013, there were no finance general appropriations for construction. Starting in that year – with the advent of Emanuel’s “Building a New Chicago” water main replacement project – appropriations from the water and sewer funds for capital construction were classified as finance general, rather than being listed under the Department of Water Management budget. 

The capital expenses far outweigh DWM’s in-house budget: in 2023, the finance general budget included $133.7 million for capital construction, while DWM’s budget included only $3.9 for a separate appropriation titled “maintenance and construction.” 

Finance general capital construction appropriations dipped dramatically during the pandemic, when workers were under lockdown or distancing requirements and construction projects slowed or halted. With the 2023 budget, an upward trend resumed, though the annual appropriation is still down from the project’s 2015 peak of $278.4 million.

Finance General at the Budget Hearings

Chicago’s public budget process relies heavily on City Council hearings with department heads. Questions from the floor are sometimes more operational than budgetary, but each alderperson has at least the opportunity to ask the leadership of each city department about the details of their annual budget request. 

Because the finance general budget is explicitly non-departmental, there is no hearing dedicated to its contents. Alderpersons’ best opportunity to publicly explore the finance general section comes on the first day of hearings, when the Office of Budget and Management takes questions regarding the entire budget proposal from the council, but in recent years there has been little detailed discussion of finance general appropriations. 

In 2023, that meant that 43.2% of the taxpayer spending authorized by City Council underwent almost no public inquiry or debate. Alderpersons – and individuals making public comment – have an opportunity this year to press for detailed explanations of the city’s major cost drivers and the accounting practices used in the finance general category at the Office of Budget and Management departmental hearing. 

The Better Government Association Policy Team will be releasing a series of daily budget snapshots ahead of departmental hearings, available as a newsletter. We encourage legislators, city staff, and members of the public to subscribe for daily updates, with highlights on major departmental expenditures, changes from previous years’ budgets, and more!


Geoffrey Cubbage is a policy and budget analyst focusing on the Illinois General Assembly and Chicago's City Council. Prior to joining the Better Government Association in 2022, Geoffrey served as Director...