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Health & Fitness

Chicago borrows money to settle lawsuits

The Chicago City Council recently rubber stamped Mayor Rahm Emanuel's plan to borrow $900 million in bonds. The money will be used to restructure debt, pay for construction and other building costs and to cover legal settlements.

That’s right the City of Chicago is borrowing money to pay for lawsuit settlements!

About $100 million of the borrowed funds will be used to pay for lawsuit settlements. Clearly the amount of money being spent on litigation is creating a strain on the City’s budget. It has gotten so bad that the City is forced to borrow money just to pay its litigation costs.

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Municipal governments very often are the target of litigation because local governments are perceived as soft targets. Local governments tend to settle lawsuits rather than fight them, which in turn makes city governments a frequent target for litigation. The amount of money spent on litigation is never going to be zero, but local officials owe it to their constituents to examine how litigation is handled and explore options to bring those costs down – especially when the City has to borrow money to pay for lawsuit settlement.

Money spent on unnecessary, frivolous lawsuits is a waste of taxpayer money. There are better uses of taxpayer money than spending it on lawsuit settlements. City leaders should be looking for ways to reduce litigation costs instead of shifting the cost of litigation to future generations.

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