Several Recent Reports Focus on Illinois Property Tax System

By Scott Metcalf

Over the years, many reports have been published about the property tax system in Illinois, but the property tax remains a mystery to a large part of the community. Over the past several months, three new reports have been issued that present useful information on the property tax system in an easy-to-understand format.

In December 2009, the report of the Property Tax Reform and Relief Task Force was released. The Task Force was created by the General Assembly in 2007 to investigate methods of reducing the reliance on property taxes and alternative methods of funding local governments. After providing an extensive survey of property tax topics and statistics, the report makes the following recommendations:

• Rebalance revenue sources (i.e., expand sales taxes or increase income taxes);
• Consolidate government services and functions;
• Enhance circuit breaker programs;
• Expand the Senior Citizens Real Estate Tax Deferral Program;
• Connect property tax relief to the property tax bill through a State voucher program; and
• Review State statutes on Tax Increment Financing.

The Commission on Government Forecasting and Accountability also recently released its updated report on property taxes. Rather than making recommendations for change, this report provides a history of property taxes in Illinois, an explanation of the assessment and equalization process, and a summary of property tax relief measures. A few of the interesting facts presented in the report include:

• $22.4 billion in property taxes were paid in Illinois during 2007;
• Schools received 62.5% or $13.89 billion of those property tax revenues; and
• The aggregate State property tax rate declined from 7.68% in 2001 to 6.77% in tax year 2006.

Finally, the Civic Federation released its report, Cook County Property Tax Appeals: A Primer on the Appeals Process with Comparative Data for 2000-2008. This report provides a step-by-step explanation of assessment challenges and other tax objections. Of note in this report are the Cook County tax appeals statistics. For tax year 2008, the Assessor’s Office reduced the assessed value of property in Cook County by $2 billion. The Cook County Board of Review then reduced the assessed value by an additional $2 billion. The actions of the Assessor’s Office and the Board of Review together amounted to a 5% reduction in the $76 billion of total assessed value in Cook County. Scott Metcalf, who worked for the Civic Federation prior to joining Franczek Radelet, contributed to this report.

These reports not only help explain the property tax system, they also reveal the size, scope and importance of property taxes in Illinois.