Controversial assessments have history of appeals by Burke and Madigan

Controversial assessments have history of appeals by Burke and Madigan

An order currently under consideration by Chicago City Council challenges the assessments of seven properties, four of which have been the subject of property tax appeals by the law firms of Chicago Alderman Ed Burke or Illinois House Speaker Mike Madigan.

A Chicago City Council proposal to challenge the assessments of seven commercial buildings in and near the Loop is being stonewalled. And government records show the assessments of some of those properties have been appealed by law firms founded by some of Illinois’ most powerful politicians.

Four of the seven buildings mentioned in the proposal have been the subject of property tax appeals by Illinois House Speaker Mike Madigan’s law firm, Madigan & Getzendanner, or 14th Ward Alderman Ed Burke’s firm, Klafter & Burke.

Alderman Ricardo Munoz, 22nd Ward, introduced the proposal in a Jan. 17 City Council meeting. Twenty-two other aldermen co-signed Munoz’s measure, but the proposal was sent to City Council’s infamous rules committee. The rules committee is a well-known legislative graveyard for proposed measures lacking the blessing of City Council’s most powerful members.

Though Munoz requested the proposal go to the Committee on Housing and Real Estate, Burke asked that the measure be sent to the Committee on Finance, which he chairs. Because there was a dispute over where the order should go, it was then sent to the rules committee, per City Council rules.

Burke’s law firm, Klafter & Burke, has represented parties in appeals concerning two of the seven buildings mentioned in the proposal: 1 N. LaSalle St. and 1000 W. Fulton St. Klafter & Burke has gotten 1 N. LaSalle’s assessed value reduced by millions of dollars. Assessed values are used to calculate property tax bills.

Clients at 181 W. Madison St. and 123 N. Wacker Drive have had their assessments appealed by Madigan & Getzendanner.

Cook County’s opaque and complex property tax system has created a lucrative business for firms that handle property tax appeals. However, the system has also created massive inequity, as a 2017 Chicago Tribune report revealed the assessor’s office regularly underestimated the value of expensive properties while overestimating the values of properties in poorer areas.

Several of Illinois’ most powerful politicians work at law firms that handle property tax appeals.

And for both Madigan and Burke, business is booming. A joint report by the Chicago Tribune and ProPublica Illinois revealed both politicians’ firms handled appeals representing billions of dollars in assessed value from 2011-2016.

The investigators analyzed more than 40,000 commercial and industrial parcels in Chicago, and of that subset more than two-thirds of the commercial and industrial assessments from Cook County Assessor Joseph Berrios’ office were stagnant in consecutive assessment years, a phenomenon one expert told the Tribune was virtually impossible if an assessor’s office is using the proper valuation methods.

The report ranked Madigan & Getzendanner the No. 1 law firm for commercial and industrial property tax appeals, measured by the total initial value appealed. The firm won some $1.7 billion in assessed value reductions for its clients from 2011-2016. Klafter & Burke appealed the fourth-highest total amount of initial assessed values, at $4.7 billion during that time. Klafter & Burke attorneys won $865 million in reduced assessments for their clients.

Both Burke and Madigan have had ties to Berrios. Berrios also co-owns a consulting company that has been engaged to perform lobbying work in both the General Assembly and the Chicago City Council, where Madigan and Burke, respectively, hold powerful positions.

And Madigan has also helped Berrios in his election efforts: Precinct workers from the Southwest Side, where Madigan’s district is located, aided Berrios’ campaign for the Cook County Board of Review in 2008, and Madigan’s political workers assisted Berrios in his 2010 Democratic primary race for Cook County assessor.

While these conflicts of interest are troubling, they are not surprising given Illinois’ lax ethics standards. As the Better Government Association pointed out in 2015, Illinois’ weak laws, feeble enforcement and insufficient transparency make the state ripe for blatant conflicts of interest such as those displayed in Cook County.

A report from the National Conference of State Legislatures shows Illinois is one of the only states in the country whose state legislative chambers have no rules on self-recusal in the event of a conflict of interest.

Given the clout-heavy game of property tax appeals and a permissive culture surrounding conflicts of interest, it’s little wonder Burke is trying to kill this order to challenge property assessments.

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