Property Assessments in Disarray: Statewide School Funding Impacted Downstate, in Chicago and Suburban Cook

Today State Representative Jeanne Ives called for an investigation by the Illinois Department of Revenue (IDOR) of all 102 counties to determine their compliance with state property tax assessment and valuation laws.  

Her request was made amidst an ongoing debate over how more than $6.7 billion in state tax dollars will be distributed to K-12 schools.  Community property wealth is the predominant variable used to determine how much money each school receives from Springfield. Poorer districts get more, wealthier districts get less.

Property valuations are conducted by Illinois townships and counties and governed by state statute to ensure all taxpayers are treated uniformly and fairly.

But in public testimony last week, downstate superintendent Gary Kelly of Du Quoin Community Unit School District 300 told the Illinois House Education Appropriations Committee that the property in his Perry County district had not been reassessed “in decades.”

“It was shocking to hear a veteran school superintendent (Kelly started at Du Quoin in 1993) so casually suggest that his county is willfully ignoring state law,” Ives said. “Property reassessments must be done by law a minimum of every four years. The law is clear.” 
Ives subsequently verified Kelly’s claim-- the last Perry County property reassessment was, in fact, conducted in 1982-- as well as the fact that this is a statewide problem. 

In many downstate counties, Ives found, assessors regularly ignore the state law requiring every property be re-assessed every four years. Instead, they subjectively select small groups of properties for random re-assessment.

This is grossly unfair to those property owners and the property owners who aren’t re-assessed. It also distorts our state school funding formulas, which uses knowingly inaccurate, out-of-date property values.

Ignoring state law on property assessment also allows local officials to politically abuse it, rewarding friends and punishing enemies. 
The consequences of this willful ignorance of state statute has had ramifications statewide.

● Business owners in Coles County filed a federal lawsuit in June, alleging the county refuses reassess their properties, which have fallen in value. The net: they claim they overpaid $930,000 in property taxes in 2016.
● Chicago City Wire reported in early 2017 that the last ten sales in the West Pullman neighborhood of Chicago were, on average, valued by the assessor 75 percent higher than their actual values

●  Effective tax rates are more than 10 percent in parts of south and west suburban Cook County, as actual property values have declined but county assessments have not been adjusted.

● The Chicago Tribune recently published a series of articles concluding that, in Cook County, “Assessor Joseph Berrios has resisted reforms and ignored industry standards while his office churned out inaccurate values. The result is a staggering pattern of inequality.”

● An independent analysis of the top commercial sales in Chicago over the last two years show those properties, some with sales prices over $1 billion, are 40-60 percent under-assessed.

“If we are going to fix the school funding formula, it is imperative that we also fix the assessment system upon which the school funding formula depends,” added Ives.  “School funding across the state will continue to be inequitable and unfair until we deal with this issue.”

Property Tax Task Force
In February of this year, Ives filed HR139 which would set up a task force to address property tax assessment system problems including the technology used, assessor qualifications, the consolidation of assessment districts, and the various exemptions and preferences applied to property and its impact on the system, and the use of tax increment districts.  

The task force was re-filed as HJR69 on June 23rd and has wide bipartisan sponsorship. The resolution is held up in the Democrat-controlled Rules Committee. 

“Illinois has the highest effective property tax rates in the nation. We just raised income taxes 32 percent when too many of our residents already cannot afford to live here,” Ives said. “We need a system where residents can be assured that they will not be taxed out of their homes over time.”

“The system we use to value real estate and establish property tax bills in this state is corrupt and broken. The evidence is overwhelming: it purposely mis-values your home. It needs to be fixed.”

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