Back in June I posted on the Chicago Tribune's expose on just how screwed up the Cook County Assessor's office was, resulting in huge discrepancies between the tax bills for expensive and cheap properties in the area. Then, just last week, ProPublica, in conjunction with the Chicago Tribune, published another analysis that showed major problems with the assessments for commercial and industrial properties: How the Cook County Assessor Failed Taxpayers. The bottom line is that commercial and industrial properties are so under-assessed that it's raising residential property taxes (it's a zero sum game).
It's just more evidence that the assessor's office, headed by Joseph Berrios, is grossly incompetent and it's time for this guy to go when the elections come along next year. Joe needs to be defeated in the primary because once he's on the final ballot with a D next to his name he wins another term.
Here is a summary of the issues surfaced in the article:
- The assessed values of 2/3 of these properties did not change from one reassessment to the next
- 1/4 of the properties remained unchanged in 3 consecutive reassessments
- This despite the fact that property values soared during this time period as the area recovered from the real estate crash
- Generally, more expensive properties are undervalued while cheaper properties are overvalued - just like on the residential side
- Properties are significantly undervalued even after recent sales when there should be no debate about what they are worth. A few examples:
- An Oak Street building valued at $3.6 MM despite selling for $14.9 MM the previous year and then subsequently selling for $23 MM.
- The Sears Tower (Willis my ass) valued at $580 MM despite selling for just over $1 B in the same year.
- An office building at 300 N LaSalle was valued at $392 MM despite being sold for $850 MM the year before.
- 311 S Wacker reassessed in 2015 at $230 MM despite selling for $302 MM the year before.
- Key people in the office have no idea how the assessments are done.
- More than half of Berrios' campaign funds come from property tax appeal law firms that are making a killing off of appeals driven by the terrible reassessments. Either Berrios is intentionally making the assessments bad to keep these guys in business or (more likely) these guys want Berrios to stay on the job because he's keeping them in business or they are just looking for special treatment from the assessor's office.
- The assessor's office employs family members of some of the law firms
If you are frustrated with how high your residential property taxes are this mess is part of the problem. Under-assessed commercial and industrial properties have shifted part of the tax burden to homeowners. So, when the primary comes around you will finally have a chance to actually do something about the underlying problem.
#ChicagoPropertyTaxes #CookCountyPropertyTaxes #PropertyTaxes
Gary Lucido is the President of Lucid Realty, the Chicago area's full service discount real estate brokerage. If you want to keep up to date on the Chicago real estate market, get an insider's view of the seamy underbelly of the real estate industry, or you just think he's the next Kurt Vonnegut you can Subscribe to Getting Real by Email using the form below. Please be sure to verify your email address when you receive the verification notice.