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Just 2 years ago in late 2000, the Cook County Board of Commissioners (this is not the same elected boy as the Cook County Board of Review Commissioners) passed a property tax ordinance that reduced the assessment of Class 3 "mom and pop" mixed use properties from 33% to 16%. These buildings typically have businesses on the ground floor and apartments above. Such retail properties with up to 20,000 square feet and with 1 to 5 units of residential housing had tax bills slashed in half. Now this April, the Cook County Board unanimously passed another property tax ordinance that reduced the assessment on all Class 3 properties. These buildings include multi-unit residential properties with 7 or more units. Assessments on all Class 3 Cook County parcels will drop from 33% to 26%. These property tax reductions will be phased in starting in 2003 when the City of Chicago is reassessed. The net effect of the change is that property tax bills could be reduced by as much as 21%. A residential multi-unit property owner with a $20,000 annual tax bill could save as much as $4,200. A $120,000 tax bill could be reduced to as much as $95,300. Is there a catch here? Well, perhaps two. When the assessed valuation of a property increases, these projected savings decrease. In addition, if the tax rate increases for any of the myriad of taxing bodies in the county, projected savings would again decrease. What is the fiscal impact of this assessment change considering Class 3 properties represent 6.8% of the classification mix in Cook County? As Cook County contributes $7.6 billion to the statewide property tax collection, Class 3 property owners could theoretically enjoy an estimated $100,000,000 tax savings over the 2003 and 2004 phase in period. The tax savings will likely be paid for by increases in tax bills on homes, retail and manufacturing businesses. The tax cut package was sold to the County Board who were reassured that the revenue lost would be recouped by future reassessment increases. A good reason for placing limits on triennial reassessments in Cook County! CFAT is spearheading a binding referendum petition drive to cap residential assessments. Local tax advocates, including CFAT leaders, applaud any tax break for Cook County, but are still urging the county to restructure its classification system to the uniform assessment system practiced in all other 101 Illinois counties. To reduce the assessment level disparities between property classes does nothing to reduce the state's multiplier which more than doubles property tax bills. The multiplier, which is essentially a measure of assessment accuracy, is applied in Cook County to bring assessments in line with Illinois' other 101 counties. Again, the outcry is to simplify the system. There is a growing consensus about the problems and inequities of our property tax system. Property tax changes between 200 and 2002 demonstrate recognition of the challenges of gentrification and profitability faced by owners and investors, as well as the lack of affordability experienced by renters. CFAT News Source news@fairtaxes.net COOK COUNTY BOARD UNANIMOUSLY PASSES PROPERTY TAX REDUCTION NOTICE |
