Newly released reports shed light on how major shifts in the property tax burden are affecting homeowners, landlords and businesses in south and southwest Cook County.
Sharp increases in property assessments dramatically drove down tax rates throughout the region, according to a report Clerk Karen Yarbrough issued Thursday.
The typical south suburban Cook homeowner can expect to pay an additional $263.81 in property taxes this year, the clerk said. The typical tax bill for south Cook increased 4.54% to $6,077 for a home assessed with a fair market value of $190,500.
The clerk’s annual report on tax rates drew additional interest this year because the office of county assessor Fritz Kaegi reassessed south suburban properties in 2020. The total equalized assessed value of property in the south and west suburbs shot up 17%, the clerk said.
“The increase in EAV means that the overall property tax burden in Cook County has shifted towards the south and western suburbs and away from the city of Chicago and the north and northwestern suburbs,” according to the clerk’s report.
Meanwhile, county treasurer Maria Pappas Tuesday issued her first of its kind analysis of the $16.1 billion in property taxes charged to owners of 1.8 million Cook County parcels.
“Property owners in many south suburbs continue to pay far more in taxes than landowners in other parts of the county,” Pappas said in her report. “In what has become an all-too-familiar story, majority Black and Latino communities are being hardest hit with property tax increases.”
Second installment tax bills for 2020 were posted online Aug. 12 and will be mailed by the end of August. Payments are due Oct. 1.
The treasurer’s analysis paints a realistic but grim portrait of the tax burden in the south suburbs, while the clerk’s report on tax rates offers reasons to be hopeful about a major silver lining — the stunning decline in tax rates.
“Every time high taxes cause a business to decide to move or call it quits, the resulting loss in tax collections shifts to remaining property owners,” according to the treasurer. “This year, some of that oversized burden is being transferred from homeowners to business property owners because of the new assessments.”
Taxes on businesses soared 23.1% in Posen, 21.9% in Park Forest and 21.8% in Flossmoor, according to the treasurer. Residential taxes shot up 20.1% in Robbins and 18.1% in Ford Heights this year.
“Ford Heights and several south suburban communities continue to face some of the highest tax rates in the nation — a persistent problem that contributes to businesses and residents leaving the economically struggling, mostly minority region that often places outsized burdens on the remaining homeowners,” Pappas said in her analysis.
Yarbrough’s report said people in University Park will feel the most pain with the total taxes billed increasing 48.3% this year. The total of taxes billed shot up 29.8% in Ford Heights and 27.9% in Dixmoor, her report said.
However, the clerk’s report provided an overview of how tax rates in the south suburbs declined significantly this year. Average tax rates plunged 11.23% in the south and west suburbs, the clerk said in a 114-page report.
“Increased taxable values generally correlate to lower tax rates,” according to the clerk’s report. “Because taxable values increased more overall than rates decreased, many south and western suburban taxpayers are likely to experience higher tax bills.”
South Cook towns with the highest 2020 tax rates were Park Forest (35.47%), Phoenix (28.16%), Ford Heights (27.94%), Riverdale (27.59%), Harvey (25.04%), Markham (24.20%), Country Club Hills (23.04%), Dolton (22.06%), Hazel Crest (21.96%) and Calumet City (21.88%).
Cook County has 134 municipalities, and the 18 with the highest tax rates are all in the south suburbs. This year, though, saw dramatic rate reductions due to increased assessed valuations.
Dolton saw the biggest rate decrease, plunging 19.17% from a 2019 rate of 27.29%. Others with the most dramatic drops were Bridgeview (-15.79%), Calumet City (-14.52%), Worth (-14.37%), Evergreen Park (-14.25%), Burnham (-14.00%), Robbins (-13.57%), Riverdale (-13.42%), Flossmoor (-13.21%) and Chicago Ridge (-12.90%).
Double-digit declines in tax rates could be a major boost to efforts to attract new commercial and industrial developments to the region. It can be tough to pitch potential tax incentives to business investors who often are stunned by the shock of high rates.
“It’s wonderful news that tax rates went down substantially,” said Reggie Greenwood, executive director of the Chicago Southland Economic Development Corporation. “It is extremely important as we negotiate with new developers.”
Municipalities have used abatements through tax increment financing districts, waivers of sales taxes on building materials through enterprise zones and other incentives to lure developers of warehouses and logistics businesses.
“As the tax rates come down it will make it more competitive,” Greenwood said.
Increased commercial and industrial developments help lower the tax burden on homeowners.
The clerk’s report on tax rates reflected racial and income disparities throughout the region. Communities with the highest tax rates tended to have higher populations of Black and Latino residents, while towns with the lowest tax rates have high percentages of white residents.
Towns in south and southwestern Cook with the lowest 2020 tax rates were Lemont (7.38%), Palos Park (8.33%), Orland Park (8.92%), Orland Hills (9.82%), Palos Hills (9.89%), Crestwood (9.91%), Palos Heights (9.97%), Justice (10.23%), Merrionette Park (10.47%) and Hickory Hill (10.91%)
Last year’s reassessments led to reductions in tax bills this year for nearly half the residential taxpayers in the south and southwest suburbs, Kaegi said by phone Friday afternoon.
“The greatest injustice of the whole property tax system is those communities that don’t have much market value to begin with have to pay the highest rates so they can educate their children,” Kaegi said. “We see the racial disparity reflected in communities with the lower property values, they have the higher rates.”
Inequality among schools throughout Cook County is a product of how Illinois relies too heavily on property taxes to fund education.
The clerk and treasurer issued their reports just as newly released Census 2020 figures showed significant population declines over the past decade in Harvey, Riverdale, Tinley Park, Dolton, Calumet City and other towns.
Fixing Cook County’s property tax system in seen as key to not only attracting new commercial investment but retaining homes and businesses in the south suburbs.
“Tax bills went down for nearly half the homeowners in the south and southwest suburbs,” Kaegi said.
Kaegi said he worked with Cook County Commissioner Donna Miller, D-Lynwood, on a policy to offer tax incentives for property owners who secure tenants to occupy vacant commercial properties. Previously, owners of vacant buildings could pay lower rates than occupied stores, he said.
“We want to make sure we’re not rewarding vacancy and punishing occupancy,” Kaegi said. “We changed our vacancy policy last year. If you have too much vacancy it reduces foot traffic, it reduces people in the neighborhoods and ultimately reduces sales tax revenues that help absorb some of the cost of funding government.”
Ted Slowik is a columnist for the Daily Southtown.