By: Mark Glennon,* Updated 9/30/14
A study by the Civic Federation released yesterday computes true, effective property tax rates for Chicago area communities — the property tax rate as a percentage of actual market value.
Some rates honestly have already reached what is effectively nothing less than confiscation. You have to wonder when taxpayers in many of these places will start grabbing their pitchforks. Residential rates of three percent and commercial rates of six percent are becoming common, and some are over double that. Even Chicago’s rate, which is the lowest at 1.84%, is very high by national standards. And look at the pace at which they are increasing, shown in the chart below.
It’s sickening on a personal level for me. Chicago Heights (where I went to high school) is 5.5% for residential and 11.3% for commercial. Harvey (where I was born) is 9% for residential and 15% for commercial. This is madness. You might as well just confiscate property there and get it over with. I grew up with somebody who became a rehabber, buying broken down properties in those communities and fixing them up — just the kind of work we want to see. He gave up and has been liquidating his last holdings. This is a death spriral if there ever was one.
Keep in mind that these rates are calculated only through 2012 taxes and, as any property owner knows, taxes are still soaring further.
And this property tax burden is in addition to the tens of billions of dollars (no typo — probably much more) that Illinois homeowners have already forfeited in lost appreciation due to under performance of property here compared to national averages, which we calculated in our article yesterday.
Here are some numbers from the study but read the whole thing:
*Mark Glennon is founder of WirePoints
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Expect no retraction or apology. This what they do.
The state’s existing buyout program for its own pensions is the precedent for Chicago, which should be a warning: Look out for similar exaggerated claims and shoddy analysis.
Good time to look at property tax hikes in light of the CPS downgrade to junk status by a few rating firms. Legislative benefit hikes to underfunded pensions using optimistic rate of return estimates, questionable actuarial assumptions, putting all the risk on the taxpayer, having the employer and taxpayer shoulder more than their fair share of contributions to the pension fund, is an unjust delayed tax hike. The taxpayers deserve to know how they have not been told the full story about pensions. Compare 1970 to 2015 pension and retiree healthcare benefit levels, contribution levels, salaries and stipends and overtime… Read more »
In each town/county every taxing entity just tells the assessor how much $ they need to run each taxing body. Therefore each tax unit just guesses how much they will need. All of these units are then added up by the assessor for each town and then they cook the books and your assessment goes up. Every single assessment has cost me more $. There is NO questioning how much each taxing unity needs they just add it up. The home owner is stuck with the new assessment. Of course there is an appeal process but it is rigid and… Read more »
My rate is over 8% Iroquois County .