The Basics

Generally, every parcel of real estate in Cook County is reassessed every three years. Some properties are reassessed more often depending upon the circumstances. Factors such as new construction, physical modifications, vacancy, a tax division or consolidation of a parcel, recent sale, etc. may cause the assessor to reassess a real estate parcel more frequently.

The Cook County Assessor is Mr. Joseph Berrios (D). He was elected on November 2, 2010 and sworn in as the 9th Assessor of Cook County on December 6, 2010.

The current members of the Cook County Board of Review (presented in alphabetical order) are Mr. Michael M. Cabonargi (D), Mr. Dan Patlak (R) and Mr. Larry R. Rogers, Jr. (D).

Appeal Procedure:
The Cook County Assessor's Office is the agency charged with assessing each property at a value reflective of fair market value while the Cook County Board of Review is the agency charged with insuring that assessments are fair and equal.

A notice of proposed assessed valuation is mailed to the taxpayer of record and the taxpayer has an opportunity to appeal the assessment. This appeal can be initiated at either the Assessor level or Board of Review level. Each agency has its own procedural and substantive rules. Many of these rules are published and some of them are not. The Assessor level appeal can be filed by the taxpayer, his or her representative, or his or her attorney. An appeal at the Board of Review level may only be filed by the taxpayer if she or he is acting as an individual taxpayer or an attorney.

A decision by the Assessor may be appealed to the Cook County Board of Review, which serves as the quality control component of the assessment process. The Board of Review applies a Uniform Market Value standard to all commercial, industrial and investment grade properties before it. Board of Review decisions that are considered adverse may be appealed to the Illinois_Property_Tax Appeals Board or in the Circuit Court of Cook County.

The basic object at each level is to prove that the assessed valuation levied against the subject property is excessive. The type of evidence offered as such proof varies and depends upon the unique circumstances surrounding each property. Below are listed specific situations and the type of evidence likely to achieve the most cost effective results.

Definitions:
Abatement:
A device to encourage certain types of property development. Typically forgives all or a portion of the property tax bill for a specific time period.

Appraisal:
An appraisal is an opinion of value by a qualified individual. Appraisals over 2 years old are generally not considered persuasive evidence. Appraisals of properties valued at $500,000 or greater should include the three traditional approaches to value. The difference between the MAI appraisals Member Appraisal Institute, CAE appraisals and non MAI or CAE appraisals can be substantial in terms of quality, cost and credibility.

Neither Cook County assessing authority requires the use of an MAI or CAE appraisal. A list of our currently approved appraisers is located on our web site. This list is updated continually. A market analysis by a Realtor, although it may be very accurate, is not considered an appraisal by assessing officials and will not be considered as evidence of market value.

John P. Fitzgerald, Ltd. encourages clients to engage their own appraisers. Subject to prior approval by us, we have found that such appraisals often are equal in terms of quality, to anything produced by an appraiser on our approved list. Of course, outside appraisers must conform to our standards in terms of market value and methodology.

Assessment Rate:
That number which is multiplied by the fair market value of the property. The Cook County Board has adopted the 10/25 plan. Under this plan, Cook County real estate is assessed as follows:
Vacant Land-10%
Residential-10%
Apartments-16% during 2009, 13% during 2010, 10% during 2011,
Non-Profit Use-25%
Commercial-25%
Industrial-25%

Assessed Value:
That number which is the basis of the tax bill. It is derived by multiplying the market value by the assessment rate.

Assessor:
The elected Cook Cook County governmental official charged with setting the assessed value for each parcel.

Office locations:
Main office:
118 N. Clark Street, Chicago
Satellite offices with limited staff:
2121 Euclid Avenue, Rolling Meadows
10200 S. 76th Aveenue, Bridgeview
16501 S. Kedzie Avenue, Markham
5600 W. Old Orchard Road, Skokie

Back Tax AKA Omitted Assessment
A procedure invoked by the Cook County Assessor whereby they levy an assessment on a parcel because it was improperly classified as exempt or vacant. Notices are generally sent to the taxpayer of record and hearings are held soon after. The tax bill is usually issued with a 10% penalty added on for each omitted tax year.

Board of Review:
The county agency charged with insuring that the assessments established by the assessor are fair, equitable and uniform.

Certificate of Error:
A recommendation by the assessor to the Circuit Court that a assessment be reduced because it was erroneous. Upon approval by the court, a tax refund is processed.

Exemption:
A tax subsidy to certain owners or for special uses of property for the purpose of encouraging publicly desired objectives. In Illinois, private schools, not-for-profit hospitals, HMO's and churches are examples of uses which may qualify for an exemption.

Estimate of Redemption:
A written itemized list of the cost to redeem property taxes which have been sold at the tax sale. May be obtained from the Cook County Clerk 4th Floor 118 N. Clark St. Chicago, IL 60602. Property owners should be advised that often, an Estimate of Redemption will become invalid when a tax buyer makes a subsequent tax payment.

Green Building Tax Incentives:
Cook County does not offer tax incentives to buildings that are LEED Certified.

Income & Expenses:
All assessing officials require 3 years of income and expenses in the form of IRS returns or certified financial statements. Each agency requires that the financial data be reflective of the market thus, income derived from a below market lease will not be considered as evidence.

LEED Certification:
The Leadership in Energy and Environmental Design (LEED) Green Building Rating System, developed by the U.S. Green Building Council (USGBC), provides a suite of standards for environmentally sustainable construction. Since its inception in 1998, LEED has grown to encompass more than 14,000 projects in 50 US States and 30 countries covering 1.062 billion square feet (99 km²) of development area. The hallmark of LEED is that it is an open and transparent process where the technical criteria proposed by the LEED committees are publicly reviewed for approval by the more than 10,000 membership organizations that currently constitute the USGBC. Cook County does not offer tax incentives to encourage LEED certification.

Market Value:
That number derived by dividing the assessed value by the assessment rate.

Multiplier also known as "Equalization Factors":
A mathematical formula applied to Tax bills, which in theory, satisfies the state requirement that all real estate be assessed at 33% of its Fair Market Value. The multiplier is developed each year by the Illinois Department of Revenue after analysis of sales-ratio studies.

Cook County Multipliers
2001 2.3098
2002 2.4689
2003 2.4598
2004 2.5757
2005 2.7320
2006 2.7076
2007 2.8439
2008 2.9786
2009 3.3701
2010 3.3000

Office Holders:
Below are listed those officeholders who play a prominent role in some aspect of the Cook County taxing process.

Cook County Assessor - Joseph Berrios (D)
Cook County Board of Review - Michael M. Cabonargi (D), Dan Patlak (R), Larry R. Rogers, Jr. (D)
Cook County Clerk - David Orr (D)
Clerk of the Circuit Court of Cook County - Dorothy Brown (D)
Cook County States Attorney - Anita M. Alvarez (D)
Cook County Treasurer - Maria Pappas (D)
State of Illinois, Property Tax Appeals Board - Louis G. Apostol, Executive Director
Circuit Court of Cook County - Edmund Ponce de Leon, Presiding Judge of the County Division

Payment by Legal Description:
A method of paying a tax bill for a property which has been recently sub-divided and does not yet have its own PIN.

Property Tax Appeals Board also known as "PTAB":
A state agency which became available to Cook County taxpayers for the first time during tax year 1996.

Redemption:
A procedure whereby the owner or some other party with an equitable interest in the property, redeems the property taxes or special assessments which have been sold by the county.

Sale Price:
In Illinois there is a presumption that the sale price of a property is arms length and that it is indicative of market value. Since assessing officials are required to assess a property at its fair market value, potential purchasers of commercial and investment grade real estate should not be surprised if the property is reassessed soon after the transaction is completed and that the sale price will be a factor used by the Assessor in determining the new assessment. The projected tax load should be factored into the economics of the deal before the purchase agreement is entered into.

There are certain procedures that a lawyer can perform for the benefit of the purchaser. The most effective is an allocation clause; whereby the parties to the transaction allocate a certain amount of value to land/improvements, personal property, intangible concepts or favorable financing from the seller. Of course, there is an obligation of good faith on the part of the parties and an expectation that the purchaser be able to back up her/his allocation with a high quality appraisal. There are other factors to be considered such as, IRS depreciation and/or 1031 exchange requirements including Tenant in Common investments and the lenders requirement for collateral. It is recommended that the attorney for the purchaser consult with the purchasers income tax advisors as well as property tax counsel, prior to drafting an allocation clause.

7% Tax Cap
Legislation passed during Spring 2004, originally designed to protect homeowners from dramatic increases in the assessed valuation. This cap was to expire after tax year 2006 but was extended by the General Assembly on October 12, 2007.

Sidewell
A mapping service provided by the Sidewell Company. Available via book form, Internet or CD.

Special Assessment
The special assessment tax is often confused with the property tax. These are two distinct forms of taxation: one (ad valorem tax) relies upon the fair market value of the property being taxed for justification, and the other (special assessment) relies upon a special enhancement called a "benefit" for its justification

Specific Objection:
A lawsuit in the Circuit Court premised primarily upon market value. In Cook County these cases are distinguished between Small Claims, refund of $50,000 or less and Regular Claims. The Small Claim cases move through the system at a fairly fast rate. Until recently, the primary advantage of filing a Specific Objection instead of before PTAB is that a taxing body did not have the right of intervention in the Circuit Court. That advantage began to change on May 13, 2009 when a Cook County court held that a taxing body which is "adversely affected by a distribution caused by a refund" may intervene in a specific objection. Bank One v. Maria Pappas, 02 CT 2180

SSTRP: also known as South Suburban Tax Reactivation Project
A program which was launched by a former Cook County assessor, with great fanfare and with the intent to put tax delinquent properties back on the tax roles. Limited to 180 square miles in Calumet, Bloom, Bremen, Rich and Thornton Townships, the program, in its 14th year, needs more support. As of April 2010, only nine businesses have taken advantage of this program.

Tax Caps:
An Illinois legislative solution in 1994 in response to excessive local government spending. Under this legislation, local government is permitted to increase their levy by a maximum of 3% per year. Any increase greater than this requires voter approval.

The 7% Tax Cap is different. It was a program by Cook County Assessor Houlihan whereby he was going his assessment increases to 7% per year.

Tax Increment Financing also known as "TIF":
A vehicle which is supposed to provide for the financing of public or private projects in areas that are hard pressed to find to attract investors. In reality, it has become a slush fund for politicians pet projects.

The Chicago Reader printed a critical report on the status of Chicago's 145 TIF districts on August 11, 2006.

Tax Swap:
A concept whereby the state income tax is increased and a corresponding credit is given toward one's property tax bill. The object being to provide some revenue relief for school districts with a declining tax base. All attempts to enact enabling legislation have been defeated.

Uniformity Analysis:
This parameter is used by assessing officials to levy a value upon single family houses, condominiums and land. When performing an analysis of land on the basis of uniformity, it is important to use only comparable's which are similar to the subject property in matters of zoning, size, frontage and location.

Theoretically, uniformity is not used for income-producing properties and Class 5 properties because they are considered "unique" and thus not capable of being compared to other nearby properties.

Unique Properties:
The old "Letter Property" system is back under a new name "Unique Property" program. Under this program, which was announced May 29th 2003, the Cook County Assessor has identified 300 properties they deem "unique and difficult to assess". The Cook County Assessor posted the assessed valuations of these "unique properties" on their web site on March 1, 2004.

Uniform Market Value:
That standard employed by the Cook County Board of Review when they review the assessments levied against commercial, industrial and investment grade properties. Derived by capitalizing the potential income stream and then averaging it with other nearby comparable properties.

Vacancy:
The occupancy of a property may serve as ground for relief provided that proof of the vacancy problem can be documented and if over 20% of the property was vacant during the tax year. Copies of old leases, utility bills, photographs and other types of objective evidence will be considered by the assessing officials. The Cook County Assessor's office field checks the property for the purpose of verifying the occupancy.