Vacancy cuts are an accounting exercise, not real cost savings

Why cutting "ghost cops" is not a real solution to our budget problems.

In a somewhat surprising development, last Friday City Council did not end up voting on the Mayor Johnson’s latest budget proposal. Johnson instead called off the vote after it became clear that he lacked the necessary support to pass the proposal. While lots of parties, including the Civic Federation and many alderman - including Vice Mayor Walter Burnett - are focused on finding new spending cuts and efficiencies, Johnson seems to remain resistant to that call.

A WBEZ report on Friday walks through the concept of “ghost cops,” referring to a few hundred vacancies in the police department which the budget funds but aren’t expected to be filled this year, as a potential new focus on the chopping block. As of Sunday evening, the latest reporting from Heather Cherone indicates that these aren’t being included in an updated budget proposal from the Mayor’s office, but it’s worth talking about what these are regardless - because while it might be an accounting trick to make the math work to balance this particular budget, those aren’t cuts that will actually generate any long-term savings for the city.

The basic formula goes something like this:

• In the annual budget, we allocate funds towards a bunch of vacant positions - the CPD isn’t alone here - which often remain unfilled through the year. This increases the overall budget for those departments.

• Then, given the many shortcomings of the city’s hiring process, we end up not hiring for many of these positions.

• At the end of the year - surprise! The department ended up coming in under budget!

The key point here is that whether or not we budget for that spending in the first place, the money never gets spent regardless. As such, what we’d really be doing by eliminating those vacancies is just shifting the fiscal benefit from coming in “under budget” at the end of the year to the beginning of the year instead. That might make your math easier for the 2025 budget, but ultimately it won’t actually have any impact on how much money the City of Chicago truly spends in the next calendar year.

Frustratingly, you won’t get any of that nuance from the WBEZ piece, which quotes several Alders as wanting to reallocate those funds towards other programs:

Some public health advocates are pushing an alternative to the ghost cops. This week Ald. Jessie Fuentes, 26th Ward, filed a proposed budget amendment that would shift an estimated $166 million for those salaries to city public health programs, youth jobs and a guaranteed income pilot that is on Johnson’s budget chopping block.

At a City Hall news conference to support the measure this week, Ald. Rossana Rodríguez-Sánchez, 33rd Ward, said the police positions “are just sitting there, not providing safety for anybody.”

“How about we use that money [to] provide safety for people?” Rodríguez-Sánchez asked.

This is the point I want to make clear: allocating money for a position we don’t hire for doesn’t “cost” us anything, and we’re not “using that money” for anything. If we shifted those funds towards other programs, doing so wouldn’t be net neutral; it would create a new expense for the city.

There’s one wrinkle to that, which the Sun-Times (quoting Civic Federation president Joe Ferguson) covers. When the money allocated to those vacancies doesn’t get spent on new hires, it’s sometimes allocated to cover other shortfalls in the police budget - most notably to cover significant overtime costs the city incurs for the police we do have. A recent article from The Tribe also noted that this is also sometimes the source of funds used to pay police misconduct settlements as well.

Those are costs we’re incurring either way - we’re just not allocating for them anywhere. If the city were to eliminate the CPD vacancies, we’d need to find other funds to cover the settlement and overtime costs. And if we eliminate the vacancies and *don’t* find another pay-for for settlements and overtime costs, the city will be scrambling to cover a much larger deficit at the end of next year. From a transparency perspective, it probably makes sense for us to start accounting for those expenses somewhere in the budget. But that’s an accounting and transparency change, not a solution to the city’s ongoing budget woes.

If we really want to find more savings and efficiencies in the public safety space, there are other places to look. For instance, the Better Government Association has repeatedly found that the Office of Public Safety Administration (OPSA), a consolidated department created by Mayor Lightfoot in 2020 as a cost-saving initiative, has not generated any savings for the city. OPSA is also among the line items I highlighted in my last post as having one of the highest spending growth in the city budget since 2020 (it’s up 215%, from $19.4 million in 2020 to $61.4 million in the initial proposal for 2025).

That’s the kind of area where we should be able to generate meaningful savings for the city in the long run. But cutting ghost cops will only get us ghost savings, too.