* Cook County Assessor Fritz Kaegi has been pushing legislation this spring to obtain tax and other data from property owners, including building occupancy, income, expenses and tenant incentives. The data would not be used for individual assessments, but to create averages. Kaegi has said this is a crucial first step to reforming the assessment process.
The proposal sailed through the Senate but was held up by House Revenue Committee Chairman Mike Zalewski, who wanted some changes. The Chicago Tribune editorial board inaccurately blasted Rep. Zalewski weeks ago for moving the proposal into a subcommittee in order to kill it. Zalewski said he supported the concept, but needed to work out some details. He was true to his word.
* From Scott Smith, Kaegi’s Chief Communications Officer…
Attached is a list of changes that have been made to SB 1379, the data modernization bill, as a result of negotiations. Our office has the following statement:
“After two weeks of meetings with stakeholders, we believe SB 1379 is now a stronger bill. Negotiations have resolved concerns about the bill’s language.
“Chairman Zalewski, Assistant Majority Leader Davis and all the participants deserve credit for their work to move this important piece of legislative property tax reform forward. We remain confident of its passage by May 31st.”
* Dot points…
• Reduced the penalty to 0.025% (from 0.05%) of a property’s market value, and reduced the cap to $10,000 (previously $100,000)
• Expanded confidentiality provisions by preventing the data from being disclosed in court, and requiring robust industry standards in how the data is compiled and anonymized
• Bolstered data security measures by requiring compliance with federal information security standards
• Requires detailed annual report to the General Assembly by Assessor offices
• Institutes a rule-making process requiring posting & comment period prior to enforcement
• Tax forms do not need to be submitted, rather the data on such forms
• Changes the threshold from 100,000 Assessed Value to 500,000 market value
• Excluded all properties in Article 10 of the Code, as well as hospitals
• Added that a tenant should pay a prorated penalty based on their rentable area of a property
• Specified that we will only use compiled data (market averages) for assessment purposes; CCAO also
will publish methodology by which data was compiled for use & publication.
• Authorizes the ability to appeal the penalty to court if denied by CCAO
• Incorporates additional definitions of income and expense suggested by stakeholders
• Removed reference to unique property types (hotels & motels, parking lots, long-term care facilities)
• Further clarified the definition of owner-occupied
• Accepted changes to definition of “taxpayer”
• Notice was already required, but specified that it must be sent 60 days in advance
• Amended language in attestation clause
Click here and scroll down for a list of the types of properties excluded from the legislation under Article 10 of the state’s Property Tax Code.
*** UPDATE 1 *** Robb Karr with the Illinois Retail Merchants Association called to say there’s only a deal on the way the language is now written. “There is no deal on the policy,” Karr said.
Asked if his and other groups would be lobbying against the bill, Karr said, “I suspect, I do not know, but I suspect many will do that.”
*** UPDATE 2 *** Mark Denzler with the IMA…
There is no “deal” with Assessor Kaegi.
The business community (IMA, IRMA, Chamber, TFI, BOMA, Chicagoland Chamber) were VERY CLEAR on Friday afternoon that we are not supportive or even neutral.
We went through discussions to tighten up his language so that the bill did what he claimed it was supposed to do.
This has been a constant source of irritation over the last three months where he and/or his staff have intimated that we were OK with the bill.
*** UPDATE 3 *** Michael Cornicelli, the Executive VP of the Building Owners and Managers Association of Chicago…
BOMA/Chicago echos the sentiments expressed by IMA and IRMA. The recent discussions technically improved a terribly drafted bill (e.g., as passed by the Senate, building owners and their tenants were broadly required to submit “income and expense data” well beyond rent and related expenses, under a financial penalty four times greater than for Class X felony murder). BOMA candidly was disappointed that the Assessor’s office would not entertain discussion beyond the four corners of its original bill draft, even while acknowledging the legitimacy of unaddressed concerns over the assessment process. Presently BOMA is engaging its internal process to confirm whether our opposition still stands. We are disappointed that the Assessor jumped the gun here.
*** UPDATE 4 *** Michael Reever, SVP Chicagoland Chamber…
The Chicagoland Chamber would also like to express that no deal has been reached. It is disingenuous of the Assessor to say that there is. This is a consistent practice of the Assessor, including past statements by he and his office of misrepresenting the position of the Chamber after two explicit conversations not to do so throughout this year. We are disappointed that the Assessor would again misrepresent our position for political purposes, as we continue to work in good faith. The Assessor should be transparent about where stakeholders are on his bill.
*** UPDATE = 5 *** Kaegi’s Scott Smith…
Rich, as Robb said, we have an agreement on language in the bill - and nothing more. We understand some groups are still philosophically opposed to the bill.
* Audit Recommends Ways To Overhaul Cook County Property Tax System