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So, you think your property tax rates are high? Think again

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Illinois

* Phil Kadner looks at the striking disparity in Cook County property tax rates…

(I)n Ford Heights, one of the poorest suburbs in the nation, the property tax rate for a homeowner is more than 20 percent of his home’s equalized assessed value. Most of that money goes to the schools.

In the villages of Northfield and Wilmette, two of the wealthier suburbs in Illinois, where the schools are top notch, the tax rate ranges from 4.8 percent to 5.3 percent.

In Winnetka, the home of New Trier Township High School, where state Sen. James Meeks (D-Chicago) recently brought Chicago students to register for school, the tax rates range from 4.9 percent to 5.3 percent. […]

The property tax rates in Park Forest range from 14 percent to 17 percent and in Markham from 12 percent to 15 percent. Dixmoor is 12.5 percent, Dolton about 13 percent and Riverdale 14.5 percent.

* And he provides this food for thought…

A suburb that has lots of property tax wealth can raise a lot of money with a small tax rate.

Homeowners in a suburb that is property poor can quadruple their tax rate and still not raise as much money.

Actually, they can keep raising the rate, and still barely keep pace. This really needs to be changed.

* From the Tribune…

Chicagoans will face a double whammy. Tax bills will be based on home values as of Jan. 1, 2006, before the lending crisis began battering the housing market. At the same time, the benefits of the 7 percent cap will drop significantly this year for many city homeowners.

“Voters are facing a unique confluence of property tax issues this year,” said Laurence Msall, president of the Civic Federation.

* Related…

* David Orr’s news release

* Civic Federation analysis

posted by Rich Miller
Friday, Sep 19, 08 @ 10:46 am

Comments

And the first thing that should be done is Cook County should start assessing property — particularly residential property — the same as every other county in the state.

Comment by Karen Silkwood Friday, Sep 19, 08 @ 10:54 am
I have been pointing out the inequity in tax rates for years, but it has to be said that the people paying 4% in Winnetka are paying a LOT more in dollars than are the people paying 20% in Ford heights.

Living “downstate,” and having worked in education in the past, we see this all the time. The school tax rates down here are between $4 and $6 per $100 of assess valuation, while in the suburbs, it is $1 to $2. They pay much more in dollars, but our taxes are a greater percentage of our income.

And, yes, it does need to change.

Comment by Fan of the Game Friday, Sep 19, 08 @ 10:59 am
The situation is not unique to Chicago; it’s the same in the Metro East. School districts along the river (E St. Louis, etc.) have obscenely high property tax rates because of low-value land. White-flight “growing” communities are able to have lower rates because commercial property offsets some of the costs.
Should the educational career of any child be determined by the value of buildings in the school district in which they live? That seems like an odd way to determine it….

Comment by Vote Quimby! Friday, Sep 19, 08 @ 11:06 am
Focusing on New Trier, Highland Park, Hinsdale, Lake Forest and on and on, is a total cop-out by these communities and their leaders.

The discussion should be first and foremost on accountability for the parents, principals, teachers and administrators responsible for educating these kids, and then to go to funding remedies. It’s not as sexy as playing the financial inequality game or getting to write columns about lacrosse and kayaking, but it is where the debate should be.

Then again this is also a democratic establishment that can’t figure out how to pay itself or police itself (ethics) so this seems to follow.

Comment by Ivan Calderon Friday, Sep 19, 08 @ 11:10 am
Liberals and teachers unions are going to have a hard time selling me on sending more money to the schools until the accountability mechanisms are improved.

Proviso Township High Schools wastes tons of money on stuff that has nothing to do with education. For example, the district is paying the president of the schools board’s personal legal bills. This is only the most recent and most egregious waste.

Yet, the unions, including SEIU, have consistently endorsed re-electing the clique using the district as a cash cow for their political machine.

Property taxes are a goofy thing. And beyond a certain level they are goofy for funding all sorts of local gov’t, not just schools.

But teachers unions can’t have it both ways. You don’t get more money until you stop supporting people like the Proviso clique. The unions know the money is being diverted to non-educational purposes, but they are more interested in protecting their interests as unions than protecting their members’ interests by making sure money isn’t wasted on politically connected law firms and insurance premiums.

Comment by Carl Nyberg Friday, Sep 19, 08 @ 11:15 am
It’s hard to believe that property taxes in Ford Heights could support anything. I know the state doesn’t want to do anything about it, but I don’t think that Ford Heights can be categorized as a viable governmental unit in any real sense of the phrase.

Comment by wordslinger Friday, Sep 19, 08 @ 11:20 am
Two things need to happen:

1. Assessors need to stop opening a Pandora’s Box and not assess house and property “values” at such high rates so as to essentially hurt or bankrupt homeowners and property owners. It is apparent that such practices are both unnecessary and lead to more and more wasteful spending.

2. For the sake of helping homeowners in the suburbs and Cook County, the tax swap of increased sales and income tax brackets with continued property tax caps may work best.

I would think a small implosion of the Chicagoland housing market cannot just be a bad pipe dream. ARMs, when combined with outrageous property tax bills, could eventually cause a market black hole.

Senator Meeks’ plan to reform school funding system by easing the property tax burden is right - both for reforming the funding mechanism and assisting homeowners in dire straits.

Comment by Team Sleep Friday, Sep 19, 08 @ 11:43 am
And take this for what it’s worth, but in some respects, real estate and government assessors overly ambitious property value hikes have done just as much to harm the housing market as the subprime and secondary mavens.

Comment by Team Sleep Friday, Sep 19, 08 @ 11:45 am
Karen,
What is interesting is that other counties surrounding Cook are debating moving their system to be more like Cook’s approach. Some counties have the local/township assessors determine values and others have the county office. You there really isn’t a uniform system for Cook to move towards.

Comment by Anonish Friday, Sep 19, 08 @ 12:02 pm
Cook County assessment classifications are worse than goofy. When Assessor Houlihan came in, most people thought he would bring some reason to that office. Unfortunately, it has gotten worse, not better.

Now to the subject of basing tax bills on year old assessments. Years ago, during the depression, Illinois supposedly created this unusual one year delay on paying property taxes to give people a break. Maybe now it is time to change back and base taxes on the most recent assessment.

But then again, did we hear anyone complaining about this delay when home values were skyrocketing and taxes were paid off the older, lower value?

Comment by Anon sequitor Friday, Sep 19, 08 @ 1:03 pm
Illinois supposedly created this unusual one year delay on paying property taxes to give people a break.

cook county did. And they now borrow to cover it. So, you’d need to tax TWICE in on eyear to catch up. See how long a REALLY bad idea can stay with you?

Comment by Pat collins Friday, Sep 19, 08 @ 1:37 pm
Not real sure what’s meant by the percentages, but in my downstate community taxes are $11 per $100 EAV.

Comment by enrico depressario Friday, Sep 19, 08 @ 1:52 pm
Rich, there’s no real news here. Everyone who has paid any attention can already recite these things. Its a big piece of what the school funding reform debate is about.

Comment by steve schnorf Friday, Sep 19, 08 @ 2:47 pm
Voters are facing a unique confluence of property tax issues this year,” said Laurence Msall, president of the Civic Federation.

Thanks for clearing that up, Larry.

Percentage this, percentage that. What difference does it really make that the tax “rate” for industrial and commercial property in Harvey is several times the residential “rate” since there is virtually none of either left in that town?

Homeowners get the crumb of the ownership and “senior freeze” exemptions while Larry’s peeps get a fat loaf of TIFs, Enterprise Zones, you name it.

The relevant metric is “who pays how much”, not the rate, etc. The old EAVs, cronyism on Boards of Review (not just in Cook) are just tools to accomplish the goal.

Comment by Arthur Andersen Friday, Sep 19, 08 @ 3:04 pm
AA, I agree with your point but disagree with part of your conclusion. These studies show us that it is virtually impossible for the poorest districts (which doesn’t include Chicago) to raise enough money thru property taxes to adequately educate their children

Comment by steve schnorf Friday, Sep 19, 08 @ 3:19 pm
Another way to put property taxes in perspective is to look at what percentage of your total tax bill goes to schools. In the DuPage suburbs it varies by community, but in my community of 26,000 people, the schools get approximately 70% of my total property tax bill. The municipality gets 8% and the other taxing bodies (park district, sanitary district, library district etc.)make up the rest.

Comment by One of the 35 Friday, Sep 19, 08 @ 3:24 pm
No mention here of the organization of Illinois school finance either.

First off, let me say the dependence of school funding on local property taxes is a disgrace. Kids don’t get to choose where to live, but the unlucky ones sure get shortchanged. At a minimum there should be state equalization. Or, do what Minnesota did and take the general ed levy entirely off the property tax and fund it from income, corporate and sales taxes.

But there are also organizational issues in Illinois that need to be addressed. Should the state be ENTIRELY responsible for the pension system? A good question, in view of the ridiculous bidding wars districts get into for staff near retirement in order to inflate their final salary scheme pensions.

And should we go on tolerating non-unit school districts that have a separate school board and superintendent for each individual school?

What about a statewide core curriculum with some performance standards?

Comment by Angry Chicagoan Friday, Sep 19, 08 @ 4:15 pm
AA and Steve cut through the nonsense. Who pays what — not how — is the ultimate question of politics.

The trick of the Cook County property tax system is that it’s willfully incomprehensible to everyone but Trekkie-like geeks. The average schmuck (my hand is raised) just gives up and writes the check or sedates himself by rolling the tax into the monthly mortgage payment.

In 2008, with all the computer wizardry we can apply to redistricting, an elected assessor seems archaic.

A Cook County Board of Appeals seems like an invitation to a shakedown. You’re assessed by one hack, then you can “appeal” to another couple hacks? Not to offend current and past players, great public servants and humanitarians like Harry Semrow, Joe Berrios and Bill Shaw (or maybe it was the other one). Pay the lawyer for the appeal (Burke, Banks, Daley) or pay the tax.

Comment by wordslinger Friday, Sep 19, 08 @ 9:10 pm
When is Houlihan up for re-election?? This guy is terrible. Time to vote him and his cronies out!!

Comment by anon Sunday, Sep 21, 08 @ 9:47 am