Released October 16, 2025
On Thursday, October 16, 2025, Chicago Mayor Brandon Johnson proposed a $16.6 billion City budget for Fiscal Year 2026.
This year’s budget reflects the continued unwinding of federal pandemic relief, coupled with slower revenue growth and persistent structural deficits across city departments. The creative sector—still recovering from years of volatility—will once again need to navigate a leaner fiscal environment that prioritizes essential services while attempting to sustain cultural investment.
Context and Overview
The Mayor’s 2026 proposal is roughly $700 million smaller than the previous year’s $17.3 billion budget, signaling both fiscal constraint and the sunset of one-time federal supports. Some of the reduction citywide is attributable to the drawdown of the Coronavirus Local Fiscal Recovery Fund (ARPA), which provided temporary revenue relief to departments like DCASE (Department of Cultural Affairs and Special Events).
For DCASE, that decline is significant: the department’s share of this fund fell by 64%, resulting in an overall 13.96% decrease from 2025 revenues (from roughly $72 million to $61.9 million). These shifts mirror what many departments are experiencing as the City transitions from emergency recovery toward long-term fiscal normalization.
Departmental Highlights
Corresponding decreases can be seen across several DCASE line items, including:
- Programming: -$1.9 million
- Administration: -$4.7 million
- Marketing & Development: -$8.2 million
While it is not yet clear how these cuts may be felt (e.g. fewer special initiatives or reduced advertising capacity), the picture is not uniformly negative.
Notably, appropriations for Cultural Grants and Resources increased to $15.9 million, representing 0.096% of the City’s total budget—a modest but meaningful signal that Mayor Johnson’s administration intends to protect direct cultural investment even as discretionary funding tightens.
DCASE Budget Sources
| DCASE Budget Sources | FY 2025 | FY 2026 (Proposed) |
|---|---|---|
| Special Events and Municipal Hotel Operators’ Occupation Tax Fund | $44,292,225 | $43,667,597 |
| Other Grant Funds | $28,669,000 | $18,336,000 |
The hotel operators’ tax fund—a key revenue stream tied to cultural tourism and conventions—remains relatively stable, a positive sign given ongoing recovery in the visitor economy. However, the steep drop in “Other Grant Funds” underscores the volatility of external funding and reinforces the need for a more resilient local funding structure for arts and culture.
Proposed DCASE Budget Breakdown
| Proposed Budget Breakdown | FY 2025 | FY 2026 (Proposed) |
|---|---|---|
| Administration | $23,876,805 | $19,124,233 |
| Special Events | $3,500,000 | $3,500,000 |
| Operations | $13,733,091 | $13,861,331 |
| Programming | $8,353,664 | $6,374,782 |
| Cultural Grants and Resources | $12,612,120 | $15,984,894 |
| Marketing & Development | $9,613,980 | $1,390,298 |
| Chicago Film Office | $974,766 | $931,880 |
Interpretation
City leadership appears focused on consolidating operations and scaling back administrative costs while preserving the most visible, community-facing investments—notably the Cultural Grants programs that directly support Chicago’s artists and organizations.
The increase in Cultural Grants & Resources, even amid an overall departmental decline, suggests that cultural funding continues to be viewed as a public good tied to economic recovery, neighborhood vitality, and quality of life. That said, decreased Programming, Administration, Marketing & Development resources may hinder DCASE’s ability to cultivate, promote, and measure the impact of that work.
What to Watch
- Final Council amendments could further shift the DCASE balance, particularly if any number of negotiations absorb remaining discretionary funds.
- Tourism and hotel-tax performance will be crucial to sustaining FY2026 grantmaking levels; any dip in travel or convention revenue could translate into mid-year adjustments.
- Grant program details (CityArts, Individual Artist Grants, etc.) are not yet delineated in the public budget; the distribution of the $15.9 million allocation will determine how equitably resources reach artists and organizations across Chicago.
Arts Alliance Perspective
Arts Alliance Illinois remains cautiously optimistic. In a constrained fiscal climate, holding and even modestly increasing direct grants represents a win for the creative community. Still, the loss of ARPA dollars highlights the urgency of identifying dedicated, recurring revenue streams for the arts—whether through local levies, regional partnership funds, or new public-private compacts.
As always, the Alliance will continue monitoring the budget hearings, providing updates as new data emerges, and advocating for sustained, equitable investment in Chicago’s creative sector. At the same time, we renew our call for more comprehensive expenditure data from past years. Public transparency about how arts funding is allocated and spent is a vital step toward building trust and accountability between the City and the cultural communities it serves.
As we review the proposed budget, several critical questions remain outstanding— questions we hope will be addressed during the DCASE budget hearing on Tuesday, November 4:
- Where will we see the impact of the $1.9 million reduction to programming and the multi-million dollar decreases in administration, marketing & development budgets?
- What is DCASE’s current reserve balance, and what ongoing multi-year commitments are included in the FY26 plan?
- What is the full breakdown of grant funding sources and allocations—that is, where funds are coming from and where they are going?
We also continue to await responses from the Budget Committee to questions first raised in the FY25 Mid-Year Budget Hearing, including requests for clearer data on grant applications, awards, disbursements, and departmental revenue sources. Transparency on these points is key to understanding how public dollars are being distributed and to whom.
Take Action: Join Us in Advocating for the Arts
The DCASE Budget Hearing will take place on the morning of Tuesday, November 4, at City Hall. We’re calling on artists, cultural workers, and community members to sign up for public testimony and share why public investment in the arts matters.
If you’re interested in getting involved in our collective advocacy efforts, please email Bindu Poroori, Director of Community Organizing, at poroori@artsalliance.org. We’ll connect you with fellow advocates and offer support in preparing a strong public comment that emphasizes our shared goals.
You can also join our Chicago Organizing Space, which meets monthly to build collective strategy and power for the city’s cultural sector. Our next meeting will be on Wednesday, November 13, where we’ll debrief the DCASE hearing and plan ward-level organizing steps to ensure arts voices are represented throughout City Council. Sign up for Organizing Spaces here.
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