In February 2023, the City of Chicago and its Sales Tax Securitization Corporation (STSC) issued social bonds to partially finance the City's pandemic-related Chicago Recovery Plan (CRP) projects.

The CRP, which also leveraged federal funding to create an equity-based investment strategy for a sustainable economic recovery from Covid-19, focuses on investing in community well-being and investing in an equitable economic recovery for Chicago's neighbourhoods and communities most affected by the pandemic.

According to the City, the Covid-19 pandemic infected over 300,000 Chicagoans and killed over 5,800 by September 2021, disproportionately impacting Black and Latinx communities.

Pandemic measures such as social distancing worsened unemployment, food and housing insecurity, education gaps, and mental health for low-income Black and Latinx populations.

The $159.87 million inaugural social bond issuance for the City's planned $1.2 billion investments under the CRP targets two goals: (i) "Thriving & Safe Communities", addressing the root causes of violence by investing in social and community support, and (ii) "Equitable Economic Recovery", providing economic relief and neighbourhood development support to pandemic-affected businesses and communities and investing in Chicago's businesses and commercial communities.

The City reported an ESG pricing benefit at the time of issuance: achieving a three to five-basis point spread benefit on its social bonds compared with its non-social bonds with similar maturities and liens.

"This rare accomplishment was due to strong investor demand, generating $653.7 million in total orders for the social bonds, including $165.3 million from retail investors and $93.4 million from 12 ESG funds or buyers with ESG mandates," City officials said.

"The CRP is expected to yield measurable and intangible benefits for the City, including population retention, job creation, revenue growth, cost savings, and climate advantages. The City projects to generate via the CRP an annual additional tax revenue of $29.5 million and $8.6 million in property tax revenue. Capital investments alone could generate about 7,000 new jobs, resulting in a one-time tax revenue increase of $26.3 million for the City," it was noted in the financing's Official Statement.

The City expects to track these outcomes and has committed to annual reporting.