Watered-down Illinois property tax ‘freeze’ fails to pass House

Watered-down Illinois property tax ‘freeze’ fails to pass House

On June 28 the Illinois House of Representatives failed to pass Senate Bill 484, an illusory property tax freeze that did not offer real reform, left Chicago homeowners out in the cold, and would have left in place an opaque and expensive property tax system that benefits special interests over taxpayers.

A measure to freeze for four years the property taxes Illinois taxing districts outside of Chicago can collect has failed to pass the Illinois House of Representatives. Senate Bill 484 passed the Illinois Senate May 30, but an amended SB 484 failed to garner the 71 votes needed to pass the House on June 28. This watered-down, so-called property tax “freeze” would not have guaranteed that taxes wouldn’t go up for homeowners across the state, and instead would have propped up an opaque system that benefits special interests at the expense of taxpayers.

SB 484 would have frozen for four years the amount Illinois taxing districts, including school districts, can collect in property taxes. The bill, however, would not have applied to the city of Chicago or Chicago Public Schools, and would have allowed other Illinois school districts to apply for waivers from the freeze based on financial hardship. The bill also would have exempted from the freeze taxes to cover bond payments and pension payments.

Illinois homeowners pay some of the highest property taxes in the country. Chicagoans were hit with a record $543 million property tax hike in 2015 to pay for police and fire pensions, and learned in 2016 that CPS planned to hit up taxpayers for another $250 million in new property tax increases to pay for teacher pensions. These property tax increases are in addition to numerous other Chicago tax hikes over the past few years.

The failed property tax freeze would have done nothing for Chicago’s 2.7 million residents who are subject to these taxes.

But Chicago’s high property taxes, and the ability of Chicago and CPS to continue raiding taxpayers’ wallets, will likely benefit some Democratic politicians and the special interests that back them.

High property taxes and complicated property tax assessment processes motivate individuals and companies to hire lawyers to try to lower them. And Illinois House Speaker Mike Madigan is a partner in a law firm that has a large property tax law practice. From 2008 to June 2016, Madigan & Getzendanner succeeded in getting its clients’ property tax bills lowered by at least $70 million, according to documents obtained from the Cook County treasurer through a Freedom of Information Act request. Madigan & Getzendanner’s clients have included major corporate players such as Merchandise Mart Properties Inc., Hyatt Equities LLC, the Chicago Board Options Exchange, Bank of America and Mesirow Financial Services.

And the Chicago Teachers Union, an important Democratic constituency, has repeatedly proposed property tax hikes and other tax increases as a way to fund out-of-control pensions costs and expensive school payrolls.

A property tax “freeze” that benefits politicians and special interests while leaving out huge swaths of taxpayers is no reform at all. Illinois lawmakers should go back to the drawing board and get to work on real reform that brings down property taxes and reins in the cost drivers that keep taxes so high.

Want more? Get stories like this delivered straight to your inbox.

Thank you, we'll keep you informed!