P r o p e r t y T a x . c o mb y  F I T Z G E R A L D   L A W   G R O U P

P R A C T I C E   L I M I T E D   T O   T H E   T A X A T I O N   O F   C O M M E R C I A L ,  I N D U S T R I A L  &  I N V E S T M E N T – G R A D E   R E A L   E S T A T E            

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Assessor Kaegi addresses “Structural Racism” and other issues at the City Club

Cook County Assessor Fritz Kaegi addressed the City Club today. Below is a text version of his presentation. 
Thanks for starting us off here, Ed. Before I begin my comments, I wanted to take stock of where we all are today. This last weekend, I was at a memorial for a friend and mentor … done virtually, of course, and I reflected on what we’ve all been through. Not even one year has elapsed from Illinois’ first death from COVID-19. In the country we now have more than half a million dead from the virus. We have millions suffering from lingering effects, and millions of survivors who could not be together to comfort each other in mourning. Us survivors are coping but taking real hits—jobs lost and businesses shut, life disrupted, families living with complete exhaustion and ever-present risk.We need to express gratitude to those around us for stepping in to stop the virus, and for helping us to carry through. The County Board, President Preckwinkle, Mayor Lightfoot and her team, and so many others have delivered in this time of crisis.I wanted to thank you at the City Club, and you members out there, for sustaining this irreplaceable organization. I’m looking forward to the day when we’re back in person.Joining us today are many members of the Assessor’s Office, all of whom have performed admirably during an incredibly difficult time. The work they did in 2019 made it possible for everything we did in early 2020, just before the virus hit.
We launched online exemptions for the first time, expanded the types of appeals you could file online, and created a new call center system. With the relaunch of our website and the implementation of auto renewals of senior exemptions, we were able to handle the immense challenge of pivoting from in-person public service to remote public service just as the full effects of COVID-19 caused all of us to rethink how we worked and lived. As citizens of this County, you should know that the staff of the assessor’s office delivered under extreme circumstances, carrying on through a deadly pandemic and coping with epic economic disruption that touched directly on our work; all while switching our systems midstream. They kept the public and each other safe, showing patience and flexibility even as all of us felt pushed to our limits, and beyond. This year, our staff implemented yet another way to make things easier on vulnerable populations, by processing exemption auto-renewals for low income seniors, persons with disabilities, and veterans with disabilities. This was made possible through a bill passed by the general assembly to make life a little easier for the hundreds of thousands of people most vulnerable due to COVID-19.  As we faced down this pandemic, I’m proud of what we accomplished together and am grateful for the work they do, as dedicated public servants.I want to let everyone watching today know that we even as we accomplished all this, we were frugal. Every day, we try to show the public that we know the value of a dollar. Here’s how we’remaking good use of our resources.2
In Cook County, we serve more property owners per full-time employee than any of the other large jurisdictions, which you can see here. And we do it by spending less per parcel than any of those places.How did we do it? Not only with great effort, flexibility, and patience, but also the indispensable backing of Cook County Board President Preckwinkle, our County commissioners, and the Bureau of Technology. They funded and supported our technological transformation and our efforts to reinforce our staff with training, new talent, and data. Each day, we’re in the trenches together modernizing the office for our County’s betterment.
Today, & our equity frame
So, today we’ll talk about–A study of commercial assessments by the gold standard for our field–the results of our suburban reassessments–the impact of COVID-19–the upcoming reassessment of Chicago–closing the data gap that helps create some assessment disparities.But first,
I want to talk about why it’s so important to get this work right and what it means for theaverage property owner’s bottom line. Because that underlies each of these topics. In our property tax system, assessments are interconnected. Each property owner needs to care about how everyone is assessed, not just their own assessment, because otherwise that property owner may be picking up the tab for others through a higher tax rate. Because in Illinois, our property tax rates float, they’re not fixed. The rate you pay depends on how big the base of assessed value is. The bigger the base, the lower the rate.Let me show you here what happens if part of the system is off-kilter.3
Let’s say we’ve done our job correctly and perfectly mirrored market values in our assessments.In our example here, commercial buildings’ assessed value is a million, and homeowners’ values sum to a million. So the base is two million.Folks who own property here have a school district, town, and other local services funded by property taxes. Incidentally roughly two thirds of property taxes are for schools. In our state, this thing called a levy is the amount of money that will be collected for these bodies, regardless of the size of the assessment base over on the left.So what does this mean for a homeowner? Let’s say she owns a bungalow with $20k AV. She’sthen 1% of the base, $20k divided by $2m. If she’s 1% of the base, she has to pay 1% of the levy. So her property tax bill is $4000.But let’s say the system, perhaps through inadequate data and valuation practices, undershoots market values by 50% and only assessescommercial at 50% of where the market is. In that case, our base is now $1.5m, with homeowners now representing 2/3 of the base. Now remember, the levy over on the right does not change. In our state, levies are lump sums that must be collected regardless of how assessments are set; assessments just determine how the levy is distributed after the tax rate isset. 4
So in this case, our homeowner is still assessed just as she was before, at $20k. She’s still assessed accurately. But look what happens to her tax bill on the right. It’s gone up over $1000 to $5320. Why? Her home is now a bigger piece of the base. She’s picking up part of the tab for properties that are underassessed.This is why she has a stake in making sure the whole system is assessed fairly, because everyone’s assessment is interconnected, because we’re all dividing up the cost of government amongst ourselves based on the assessments.This is why our office is focused on accuracy, on eliminating assessment disparities, because accuracy in assessments has huge implications for equity. In each of the areas that follow, the changes we have made have focused on eliminating assessment inaccuracies and disparities that can make our system inequitable.
IAAO
These disparities are why I asked the International Association of Assessing Officers—which is the gold standard in this field–to examine the assessments in place as we found them and compare them to the prices paid in commercial property transactions in the County in 2018. They compared those commercial property sale prices with the system’s estimated market values. These market values were determined by the prior administration and the Cook County Board of Review, prior to our administration taking office. As I noted in the beginning, we need to consider residential and commercial assessments together. The Civic Consulting Alliance found problems in residential assessments in Chicago in5
2018, but they did find that in aggregate residential values were on target: homes were not, on average, over- or under-assessed. But the IAAO report found significant underassessment of most commercial properties. Overall, they found commercial properties were about 40% underassessed County-wide in 2018, and 50% underassessed in Chicago.The pattern was troubling in DEEPER ways, too. Larger commercial properties were assessed at lower rates than small businesses and the values showed a lack of uniformity in many cases, creating the potential for unfair tax disparities. Outlying neighborhood commercial properties also tended to be assessed at a higher rate. In short, some people were getting a break while others were making up the difference. As we saw in the earlier example, assessment disparities can mean that the annual financial impact of this underassessment can be really big for those who are assessed accurately.
Process improvements at the outset
This is why it was so important to focus on reducing distortions and eliminating these disparities as we reassessed the suburbs over the last two years. The first thing we did was to commit ourselves to transparency, by showing our work. No more black box valuations, which were a source of endless complaints in the commercial community. We also committed ourselves to eliminating sources of bias, favoritism, and conflicts of interest. This meant doing things like making commercial appeals anonymous to our analysts, implementing an ethics code forbidding campaign contributions from practitioners who practice before us, and requiring evidence to be based on professional standards. For example, an appraisal actually had to meet the federal standards that a bank would require. 6
For those of you who don’t know, there’s a small subset of the appraisal industry whose entire purpose is to argue that a double bacon cheeseburger is in fact a salad. If only it worked like that, all of us quarantined at home might be feeling a little slimmer. Unprofessional practices by appraisal mills hurt equity if they are taken at face value, because they can throw commercial assessments off kilter, injuring everyone else, not to mention bringing disrepute on honest appraisers who respect industry standards. Having high-quality standards and using better data are key to making assessments more accurate and fair.
Suburban reassessments
Now, I’m about to show you the results from the South Suburban reassessment, but I can’t help but plug our report of the North Suburban Reassessment. It provides lots of new data and graphics, where you can see how we took action to realign the system, and also calculate for yourselves the impact of changes to assessments on properties in your community.[show some of the beautiful graphics]The report has great data and charts showing you our sources, and the reasonable basis for thedata we use, which no one disputes in its accuracy or authoritativeness. Actually, we showed sources that institutional investors can look up for themselves and track each day. Here’s one example.7
 And I gotta say, it has some striking cover art contributed by world famous Chicago-area artist Chris Ware, with scenes and buildings from throughout the county.So, here are the results from our reassessment of the South Suburbs. Several things to note here.1.
 
Note that the base grew overall.
2.
 
The residential base grew, even after COVID-19 adjustments.
3.
 
The commercial base grew more, also after COVID-19 adjustments.
4.
 
With better modeling techniques, we dramatically improved regressivity in residentialassessments.
5.
 
 All these trends were a basic continuation of what we observed in the north suburbs, where we realigned the base with more accurate commercial assessments than the ones we inherited.
6. We’ll soon have a report on the south suburbs like we did for the north.
COVID-19 section
8
 As I mentioned, our assessments in the south suburbs took into account the devastating effects of COVID-19. And we’re proud that they did.We were just starting to send out assessments in February 2020 when the effects of COVID-19 began to be seen here in Illinois. [fan chart showing impacts of COVID-19 on different classes]The individual sales transactions we prefer to use are reported with a lag of several months, but real estate capital markets told the story in real time. By the end of February, publicly traded portfolios of real estate were already taking hits, led by hotels and retail. By the end of March, serious distress was clear. Bond markets were showing distress with hotel and retail mortgages going on watch lists. Some commercial mortgage delinquency rates blew out from low single digits into the teens. The equity capital markets were saying hotel values were down as much as 40%, with retail down 30%, single-family homes down, while the market was also saying some kinds of real estate were up, like data centers. Then, the Governor and the President declared natural disasters, meaning that property owners could get relief for COVID-19 impacts during the appeals process.9
Now as you look at this chart, think back to the discussions we opened with today. Imagine having assessments reflecting a by now-out-of-date state of the world. Some kinds of real estate devastated, others going up. But then add an additional element of distortion by imagining that only a portion of the assessments would be appealed. In that case, only some properties would reflect the market impacts of COVID-19, but the majority of assessments would likely be frozen in place with pre-COVID-19 assessments. If we did nothing and stood pat, we would not only NOT reflect current market conditions, but we’d also create a notably more inequitable assessment roll, with some carrying the burden for others.The more equitable thing to do was recalculate assessments with these effects included. It wouldn’t be perfect because no matter when we made our valuation decision, conditions would continue to change afterwards. But at least the overall assessment roll would have the initial effects of COVID-19 reflected, saving property owners some of the costs and troubles of appealing during a pandemic, while creating a more equitable and up-to-date assessment roll. We published our first valuation document last May, noting all the data sources and methods used in our residential assessments, then a follow-up on our commercial assessments. You canfind those reports, along with community specific maps of our residential adjustments on our website..10
Chicago
Now, 2021 is one of our biggest challenges yet, more challenging in some ways even than 2020.First, we’re reassessing the City of Chicago, which represents fifty-two percent of the parcels in Cook County. So we’re doing more than half of our triennial reassessment work this year. We’reconfident we’ll meet this challenge as we have improved the quality of our residential modeling and are regularly meeting the IAAO standards for high-quality assessments. We’re also launching the opening phase of replacing our office’s whole software and hardware system of record. This is the beginning of our County’s deployment of the integrated property tax system from Tyler Technologies. It’s a long-delayed upgrade that moves us away from the aging mainframe platform used to power four offices involved in the Cook County property tax system. This upgrade will get us off the kind of green screen technology used in the movie
WarGames
and onto a modern platform used by assessor’s offices nationwide. It’ll also mean the data and methodology will be more transparent and easier to access than ever.We expect the trends that we observed in our reassessment of the suburbs to continue in Chicago. That is, we expect the residential and commercial base to grow, to close the disparity gaps observed in commercial reassessments, and to reduce the regressivity of residential assessments. All of these things will address the disparities and inequity identified by the IAAO.11
RPIE
With the world turned upside by COVID-19, we’re trying to make sure we have an accurate picture of local conditions facing commercial properties. We’re meeting with commercial property owners, chambers of commerce, and others. We’re seeking to independently verify neighborhood commercial data. And we’re encouraging folks to use our real property income and expense tool, known as RPIE. Every commercial parcel owner in Chicago this year received RPIE instructions in the mail. This tool helps us close the data gap that may have contributed to the disparities where smaller commercial properties tended to be assessed more highly than larger ones, especially in the neighborhoods where third party data is scarce. It lets owners tell us what real, on the ground conditions are like.Now, you would think a tool that gets assessments right at the beginning of the process would be welcomed by most people. It saves property owners money on the appeal process and certainly gets their assessment at a more accurate initial position. But it seems not everyone shares our enthusiasm for better data. We’ve seen more than a few letters and statements like this one from property tax firms, who instructed their clients not to fill it out.Why would these groups be opposed to our efforts to get better data? Why wouldn’t they want us to create fairer assessments from the beginning instead of forcing taxpayers to go through a costly and time-consuming appeals process? Yes, there will always be a need for appeals to 12

Speaker Welch suggest another attempt to pass a graduated income tax

Wednesday, Feb 24, 2021

* Greg Hinz

Illinois lawmakers probably ought to take another whack at passing a graduated income tax amendment but should specifically tie much of the proceeds to paying off old pension debt.

That was the suggestion today from the new speaker of the Illinois House, Emanuel “Chris” Welch, as he came under strong questioning [during a webcast event hosted by the Economic Club of Chicago] about how the state should handle $144 billion in unfunded pension liability for state workers and educators. […]

Welch did not say what share of a new amendment should be promised to pensions. But he did predict that given the state’s fiscal problems, the income tax issue isn’t going to disappear.

“If we don’t change (the current flat tax) . . . we’re going to be talking about this in another five years,” Welch said. Adopting a graduated tax like most other states have is “one of the structural changes we need.”

I reached out to Welch’s spokesperson Sean Anderson, who said the House Speaker was “simply highlighting the unfairness” of the state’s tax system and that Welch “doesn’t think anything should be taken off the table.”

Asked if Welch was prepared to move legislation this spring, Anderson said “I think he’s prepared to have a conversation with his caucus and with the governor on the best way to move forward, given the budget, given the deficit.”

Considering that the Fair Tax seemed to drive Republican turnout last year and that many House Democrats were actively running away from it by the fall, I’m thinking they’re gonna need a much different approach than last time, if this is actually anything beyond some public spitballing during a webcast. Tying it to debt might help, I suppose, but people would rather pay for things they can touch and fixing past mistakes by throwing money at them is never an easy sell. And maybe applying it to annual income over a million dollars could work, too. Madigan put an advisory referendum on the ballot to do just that back in the day and it got a lot of votes.

Appellate Court of Illinois Upholds PTAB Findings

Justice Carter delivers an excellent analysis of the current law with regards to administrative review of a decision by the Illinois Property Tax Appeal Board.
Presented by M.K. Fitzgerald

2020 IL App (3d) 190397

Opinion filed November 30, 2020 _____________________________________________________________________________

IN THE APPELLATE COURT OF ILLINOIS, THIRD DISTRICT

EDWARD SIMS JR. TRUST, )
) of the 14th Judicial Circuit,

Plaintiff-Appellant, )

v. )

THE HENRY COUNTY BOARD OF ) REVIEW, THE ILLINOIS PROPERTY ) TAX APPEAL BOARD, and TAMRA S. )

DYNES,

Defendants-Appellees. ____________________________________________________________________________

JUSTICE CARTER delivered the judgment of the court, with opinion.

Presiding Justice Lytton and Justice Schmidt concurred in the judgment and opinion. _____________________________________________________________________________

OPINION

Plaintiff, the Edward Sims Jr. Trust (Trust), filed a property tax appeal with defendant, the Illinois Property Tax Appeal Board (PTAB), seeking a reduction in the 2012 assessed value of certain farm property owned by the Trust. The Trust asserted in the tax appeal that one of the improvements on the property, a farm building, had been given too high of an assessed value by the local assessor. After conducting an evidentiary hearing, during which both sides submitted appraisals of the property, the PTAB denied the Trust’s request for a reduction. The Trust filed a complaint for administrative review, and the trial court affirmed the PTAB’s ruling. The Trust appeals. We affirm the PTAB’s decision.

Appeal from the Circuit Court Henry County, Illinois.

Appeal No. 3-19-0397 Circuit No. 18-MR-158

The Honorable

Jeffrey W. O’Connor, Judge, presiding.

I. BACKGROUND
The Trust owned an approximately 224-acre parcel of farmland in Western Township,

Henry County, Illinois. Located on that farmland were two improvements: a large pole barn/farm building and a grain bin. The farm building, which is the subject of this appeal, was built in 2011. It was approximately 20,700 square feet in size, had walls that were 20 feet high, had steel siding and a steel roof, and had electrical and water service. The farm building was divided into two sections. The first section was approximately 7700 square feet in size, was insulated and heated, had concrete floors, and contained a workshop area and an office area. The second section was approximately 13,000 square feet in size, was unheated, had gravel floors, and was used to store farm machinery. Both sections had multiple overhead doors and one or two walk-in doors.

The farm building was assessed for the first time by the local assessor in 2012. For that year, the assessor assigned the entire property (the farmland and the improvements) a total assessed value of $164,170, which consisted of an assessed value of $67,760 for the farmland and $96,410 for the two improvements ($93,831 for the farm building and $2579 for the grain bin).1 As indicated by the assessed value that had been assigned, the farm building had been given a contributory value of $281,520 for property tax purposes. See 35 ILCS 200/10-140 (West 2012) (indicating that the assessed value of improvements on farmland is 331⁄3% of their contributory value).

Although the assessment information initially provided in the record did not show a separate assessed value for each of the improvements on the property, that information was later provided in the hearing before the PTAB.

After the 2012 assessed values were assigned to the property, the Trust filed a property tax appeal with the Henry County Board of Review (Board) seeking a reduction. The Board denied the Trust’s request.

In February or March 2013, the Trust appealed the Board’s ruling to the PTAB and again sought a reduction in the assessed value of the property. In its appeal, the Trust again asserted that the farm building had been overvalued by the local assessor. The Board opposed the Trust’s request for a reduction and asserted that the farm building had been properly assessed. Both sides submitted appraisal reports in support of their positions.

The Trust’s appraisal was conducted by Michael Blean, an Illinois certified general real estate appraiser with 30 years of farming experience. To determine the contributory value of the farm building, Blean used the cost approach, which consisted of estimating the replacement cost new of the building and subtracting depreciation from that amount. Using a standard cost guide, Blean estimated the replacement cost of the Trust’s farm building to be $406,944, not including the cost of site improvements.

To determine the amount of depreciation, Blean looked for comparable sales. Blean found one sale in a different county that he thought was a good comparison because it involved a farm building of similar size, age, and structure, although the sale had been court-ordered and the property had been sold through an online auction to one of the owner’s relatives. Using certain known information from the comparable sale and elsewhere, Blean calculated or estimated the value of the comparable property’s farmland, the contributory value of the comparable property’s farm building (the total consideration paid for the comparable property as a whole minus what Blean had calculated to be the value of the comparable property’s farmland), and the replacement cost of the comparable property’s farm building. From that information, Blean estimated that the comparable farm building had 87% depreciation (the replacement cost of the comparable farm building minus what Blean had estimated to be the contributory value of the comparable farm building with the answer converted to a percentage). Blean allocated that percentage into the following three categories: 24% physical obsolescence, 40% functional obsolescence, and 23% external obsolescence. Blean did not state in his report, however, how he had determined what allocation percentages were appropriate or how he had estimated the replacement cost of the comparable farm building.

After determining the depreciation percentages for all three categories of depreciation with regard to the comparable farm building, Blean used that information to estimate the depreciation percentages for the Trust’s farm building. Blean estimated that the Trust’s farm building had 0% depreciation for physical obsolescence because the Trust’s farm building was new; 40% depreciation for functional obsolescence, mirroring the percentage that Blean had assigned to the comparable farm building, because the Trust’s farm building was super-adequate or overbuilt for the size of the parcel and was specifically designed for the current owner’s operations; and 20% depreciation for external obsolescence, consistent with the percentage that Blean had assigned to the comparable farm building. Blean converted the depreciation percentages for the Trust’s farm building to dollar amounts ($162,778 or 40% for functional obsolescence and $81,389 or 20% for external obsolescence) and subtracted those amounts from the replacement cost to determine the contributory value, which Blean concluded was $162,778 for the Trust’s farm building. That contributory value represented an assessed value of $54,260 (331⁄3% of the contributory value rounded up).

2 The terms, physical obsolescence or physical deterioration, functional obsolescence, and external obsolescence, have been defined later in this opinion.

The Board’s appraisal was conducted by Joyce Webb, who, like Blean, was an Illinois certified general real estate appraiser. Similar to Blean, Webb used a cost approach to determine the contributory value of the Trust’s farm building. Using the same cost guide as Blean, Webb estimated the reproduction cost of the Trust’s farm building to be $375,316, not including the cost of site improvements. Unlike Blean, however, Webb decided that there was no depreciation to subtract from the replacement cost of the building. Webb concluded, therefore, that the contributory value of the farm building was $375,000 (rounded down), which represented an assessed value of $125,000 (331⁄3% of the contributory value).

More specifically as to depreciation, Webb determined that there was no physical depreciation because the Trust’s farm building was new; that there was no functional obsolescence because the Trust’s farm building did not have any functional inadequacies, inefficiencies, or super-adequacies; and that there was no external obsolescence because economic conditions in the local farm market were reasonably strong and the value of farmland was appreciating at the time. In making her determination on functional obsolescence, Webb commented in her report that Sims had told her that he had built the farm building with 20-foot- high walls so that he could store larger farm equipment when he purchased that equipment. Webb noted that the assessor’s records indicated that Sims and his wife owned several other parcels of farmland in Henry County and indicated in her report that it appeared from the amount of machinery in the farm building that the farm building was built to serve more than just the parcel on which the building was located.

In April 2017, a hearing was held before the PTAB on the Trust’s property tax appeal. At the PTAB hearing, Blean and Webb both testified as to their qualifications and as to the conclusions and opinions contained in their reports. Blean explained that he applied 40% functional obsolescence to the Trust’s farm building because the building was an over- improvement for the size of the parcel and because it was unfair to assume that a person buying the property would not already have a building of his or her own or would be willing to pay full value for the Trust’s farm building as it was constructed. When Blean was asked during his testimony whether farmers would typically build one building per farm or build one building to incorporate several farms, Blean responded that it could vary, but typically larger farming operations had a “base of operations.” As for the comparable sale he used to calculate functional and external obsolescence, Blean acknowledged that it was a court-ordered sale and agreed that court-ordered sales were not usually viewed as arm’s-length transactions but commented that he had very limited information available to develop the cost approach in this case. Blean insisted that from a buyer’s perspective, the comparable sale he had used had full exposure to the market because the comparable property was available for inspection and the sale was advertised online.

Webb testified that in conducting her appraisal, she found there was no functional obsolescence for the Trust’s farm building because the building had been built to suit the needs of a typical farm in Henry County. In reaching that conclusion, Webb noted that Sims had told her that he had built the farm building to accommodate his future purchase of a bigger combine and to store the big equipment that was necessary for “a good-size[d] farm operation.” During her testimony, Webb confirmed that in conducting her appraisal, she considered that Sims owned other farm property. Webb commented that it would be “rather narrow sighted” for her to ignore Sims’s other farm parcels when determining the farm building’s contributory value because most farmers used a single storage facility to store equipment that serviced multiple parcels. Webb testified further that she found that there was no external obsolescence for the Trust’s farm building because there was a good, strong economy in the agricultural sector. When asked about the comparable sale that Blean had used in his appraisal, Webb opined that Blean’s court-ordered sale was not useful in determining obsolescence because it was not an arm’s-length transaction and did not have a typically motivated seller.

After all of the evidence had been presented, the parties made their closing arguments. The Trust argued that the farm building was overbuilt and that the PTAB should not consider the farm building’s contributory value to Sims’s entire farming operation. In making that argument, the Trust conceded that the comparable sale Blean had used to calculate obsolescence was “not a perfect sale” and “maybe not the best comparable” but asserted that it was the only data available.

The Board argued that the PTAB should consider the farm building’s value to Sims’s entire farming operation in evaluating the building’s contributory value. The Board also argued that Webb’s decision to apply no functional obsolescence was supported by the evidence that the farm building housed larger equipment to service Sims’s entire farming operation in the area.

In May 2017, the PTAB issued a written decision denying the Trust’s request for a reduction in the 2012 assessed value assigned to the farm building. In its ruling, the PTAB found that the Trust had failed to demonstrate by a preponderance of the evidence that a reduction in the assessed value of the farm building was warranted. In reaching that conclusion, the PTAB indicated in its order that it had given little weight to Blean’s estimate of the contributory value of the farm building for several reasons, including that Blean had relied on an invalid comparable sale (not an arm’s-length transaction) and that Blean had used an overinflated land value for the comparable property’s farmland that caused the contributory value of the comparable farm building to be artificially low. The PTAB also noted that Blean did not include in his appraisal report his calculations for determining the replacement cost of the comparable farm building and

that he did not adequately explain or support the depreciation percentages that he had used. The PTAB indicated further in its order that it had found that the best evidence of the contributory value of the farm building was Webb’s appraisal that had been submitted by the Board and commented that the cost approach developed by Webb was more detailed than Blean’s and better reflected all of the individual components that made up the subject property.

Over a year later (the Trust was apparently not properly notified of the PTAB’s decision), the Trust filed a complaint for administrative review in the trial court. A hearing was held on the matter. After considering the arguments of the parties, the trial court affirmed the PTAB’s decision. In so doing, the trial court indicated that it viewed the issue presented as being more of a legal issue, rather than a factual issue, as to whether the phrase, “contribution to the productivity of the farm,” contained in section 10-140 of the Property Tax Code (35 ILCS 200/10-140 (West 2012)) referred only to the parcel in question or to multiple parcels that were all a part of a taxpayer’s farming operation. The trial court ultimately ruled in the PTAB’s favor, concluding that the PTAB’s decision was not against the manifest weight of the evidence, “short of a legal definition of how this applies.” The Trust appealed.

II. ANALYSIS

On appeal, the Trust argues that the PTAB erred in finding that the Trust failed to meet its burden of proof to show by a preponderance of the evidence that the farm building had been given too high of an assessed value for the 2012 tax year and in denying the Trust’s request for a reduction on that basis.3 The Trust asserts that the PTAB’s ruling was erroneous as a matter of law because in determining the contributory value of the farm building, the PTAB relied entirely upon the flawed appraisal of the Board’s appraiser, Webb, who, contrary to section 10-140 of the Property Tax Code and the relevant case law, failed to consider obsolescence and improperly considered the value of the farm building to Sims’s other farm property that was not part of the farm parcel in question. The Trust also asserts that the manner in which the farm building was assessed in this case violated the equal protection clause of both the United States and Illinois Constitutions. For all of the reasons stated, the Trust asks, although somewhat implicitly, that we reverse the PTAB’s ruling.

At various times in its argument, the Trust refers to errors that were allegedly made by the trial court. Because on administrative review, we review the ruling of the PTAB and not the trial court (see Marconi v. Chicago Heights Police Pension Board, 225 Ill. 2d 497, 531 (2006); Senachwine Club v. Putnam County Board of Review, 362 Ill. App. 3d 566, 568 (2005)), we will consider those arguments as being directed at the PTAB’s ruling where it is appropriate to do so.

Defendants (the PTAB, the Board, and the Board’s chairperson) argue that the PTAB’s ruling was proper and should be upheld. In support of that argument, defendants make numerous assertions.4 First, defendants assert that the main issue before this court is a factual issue and that the PTAB’s ruling should be affirmed because the PTAB’s factual determinations—its underlying factual findings, its assessment that Blean’s appraisal had numerous flaws and was entitled to much less weight than the Webb’s appraisal in determining the contributory value of the farm building, its determination that the Trust had failed in its burden of proof to show by a preponderance of the evidence that the assessed value of the farm building was too high, its finding as to the farm building’s contributory value, and its ultimate determination that a reduction in the assessed value of the farm building was unwarranted—were all well supported by the evidence. In making that assertion, defendants point out that despite the Trust’s contention to the contrary, the record here shows that Webb considered obsolescence and that she decided that it did not apply under the circumstances of the present case. Second, and in the alternative.

For the convenience of the reader and because it does not affect the outcome of this case, we have addressed defendants’ arguments collectively here, rather than specifying what each defendant argued individuallydefendants assert that even if we assume for argument’s sake that an issue of statutory interpretation exists, that the Trust’s interpretation of the statute is correct, and that the Board’s appraisal was flawed in that Webb should not have considered Sims’s other farm property, the PTAB’s ruling must still be upheld because the Trust failed to present any reliable evidence to establish that the farm building’s assessed value was excessive since the Trust’s appraisal was also flawed and because Webb’s appraisal contained another reason for not applying functional obsolescence in this case (that the farm building was built to accommodate Sims’s future purchase of larger farming equipment and was designed to suit the needs of a typical farm in Henry County), aside from a consideration of Sims’s other farm properties, that the PTAB could have properly relied upon in making its decision. Third, and also in the alternative, defendants assert that even if this court rules upon the merits of the Trust’s statutory interpretation argument, that argument fails because it contradicts the plain language of the Property Tax Code, precedential authority, and common sense. Fourth and finally, defendants assert that any claim by the Trust of a constitutional violation has been forfeited on appeal or is otherwise without merit. For all of the reasons set forth, defendants ask that we affirm the PTAB’s ruling.

In reply to defendants’ assertions, the Trust maintains its statutory interpretation argument. The Trust also argues, in the alternative, that even if this appeal is decided based upon the manifest weight of the evidence that was before the PTAB, the Trust should still prevail because Blean’s estimate of contributory value was credible, despite a few limited shortcomings; Webb’s estimate was not credible; the Trust satisfied its burden of proof; and the Board submitted no credible evidence of the contributory value of the farm building. As for its constitutional claims, the Trust asserts that defendants’ forfeiture argument should not be followed here because this court has a duty to maintain a sound body of precedent. For those reasons and the reasons initially stated, the Trust asks this court to reverse the PTAB’s judgment, although the Trust again does so somewhat implicitly by asking for a reversal of the trial court’s ruling.

A. Standard of Review
Before we address the merits of the parties’ arguments on appeal, we must first determine the appropriate standard of review. The Trust asserts that the key issue presented in this appeal is a question of law involving a matter of statutory interpretation, as the trial court indicated, regarding the manner in which farm buildings are valued for property tax purposes—whether the contributory value of a farm building should be based upon what the building contributes to the specific farm parcel in question or based upon what the building contributes to the entire farming operation, if a multiple-parcel farming operation is involved. Thus, the Trust contends that the appropriate standard of review for that issue is de novo. As for its constitutional claim, the Trust argues that de novo review is appropriate for that claim as well.

Defendants argue that the main issue in this appeal primarily involves factual questions regarding the application of the cost method of valuing the farm building and the appropriate amount of depreciation to be applied. Thus, defendants contend that the appropriate standard of review for that issue is the manifest weight standard—that the PTAB’s findings on those factual questions should not be disturbed on appeal unless they are against the manifest weight of the evidence.5 In making that argument, defendants point out that the PTAB did not interpret any statutory provisions when it ruled upon the Trust’s tax appeal. Defendants acknowledge, however, that a de novo standard of review would apply to the extent that this court is required to.

As with defendants’ arguments on the merits, for the convenience of the reader and because it does not affect the outcome of this case, we have presented defendants’ arguments on the standard of review collectively here, rather than individually interpret the language of the relevant statute in resolving the Trust’s arguments here. Finally, with regard to the Trust’s constitutional claim, defendants argue that if this court reaches the merits of that claim, either a de novo standard of review or a mixed standard of review should be applied.

In cases involving administrative review, the appellate court reviews the decision of the administrative agency—in this case, the PTAB—not the determination of the trial court. Marconi, 225 Ill. 2d at 531; Senachwine Club, 362 Ill. App. 3d at 568. Judicial review of a decision of the PTAB is governed by the Administrative Review Law (735 ILCS 5/3-101 et seq. (West 2016)) and extends to all questions of fact and law presented by the entire record. See 35 ILCS 200/16-195 (West 2016); 735 ILCS 5/3-110 (West 2016); Marconi, 225 Ill. 2d at 532 (discussing the standard of review and legal principles that applied to administrative review cases in general and not in the context of a property tax appeal case); John J. Moroney & Co. v. Illinois Property Tax Appeal Board, 2013 IL App (1st) 120493, ¶ 35. The standard of review that applies on appeal is determined by whether the question presented is one of fact, one of law, or a mixed question of fact and law. Marconi, 225 Ill. 2d at 532; Moroney, 2013 IL App (1st) 120493, ¶ 36. As to questions of fact, the PTAB’s decision will not be reversed on appeal unless it is against the manifest weight of the evidence (the manifest weight standard). Marconi, 225 Ill. 2d at 532; Moroney, 2013 IL App (1st) 120493, ¶ 36. Questions of law, however, are subject to de novo review, and mixed questions of fact and law are reviewed under the clearly erroneous standard. Marconi, 225 Ill. 2d at 532; Moroney, 2013 IL App (1st) 120493.

Having considered the parties’ arguments on the standard of review in the present case, we find that the appropriate standard to be applied to the key issue here is the manifest weight standard. In making that determination, we note that the Trust has not asserted in this case that the appraisers or the PTAB used an inappropriate method of valuation in determining the value of the farm building. See Kraft Foods, Inc. v. Illinois Property Tax Appeal Board, 2013 IL App (2d) 121031, ¶ 44 (recognizing that a de novo standard of review applied when the issue presented on appeal was whether an inappropriate valuation methodology was used in determining the value of the property). To the contrary, all of the parties agree, and it is has been specifically expressed by the Department of Revenue, that the appropriate method for valuing a farm building is the cost method. See Ill. Dep’t of Revenue, Publication 122 Instructions for Farmland Assessments, at 37 (Jan. 2020), https://www2.illinois.gov/rev/research/

publications/pubs/Documents/pub-122.pdf [https://perma.cc/TDZ4-BL3G].6, 7 Indeed, both of the appraisals that were submitted in the present case used the cost method to estimate the contributory value of the Trust’s farm building.

In applying the manifest weight standard in this case, we must be mindful of the following legal principles. The PTAB’s findings and conclusions on questions of fact are deemed to be prima facie true and correct. See 735 ILCS 5/3-110 (West 2016); Marconi, 225 Ill. 2d at 534; Moroney, 2013 IL App (1st) 120493, ¶ 35; Senachwine Club, 362 Ill. App. 3d at 568. For a reversal to be warranted under the manifest weight standard, it must be clearly evident from the record that the PTAB should have reached the opposite conclusion. Marconi, 225 Ill. 2d at 534; It is generally accepted that a court may take judicial notice of the information on a government website. See, e.g., Ashley v. Pierson, 339 Ill. App. 3d 733, 739-40 (2003) (taking judicial notice, although somewhat implicitly, of information on the Illinois Department of Corrections website); see also Ill. R. Evid. 201(b) (eff. Jan. 1, 2011) (indicating that a judicially noticed fact must be one that is not subject to reasonable dispute because it is either generally known within the territorial jurisdiction of the trial court or capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned).

A copy of Publication 122 with an effective date of January 2010 (the 2010 version) was submitted by the Board at the PTAB hearing. The current version of Publication 122 cited here is essentially the same as the 2010 version with regard to the matters that are relevant in this appeal. Moroney, 2013 IL App (1st) 120493, ¶ 36. That the opposite conclusion is reasonable or that the reviewing court might have ruled differently if it were the trier of fact is not enough to justify a reversal. Marconi, 225 Ill. 2d at 534. Thus, if the record contains some competent evidence to support the PTAB’s decision, the PTAB’s decision should be affirmed. See Marconi, 225 Ill. 2d at 534; Moroney, 2013 IL App (1st) 120493, ¶ 36. Furthermore, determining the credibility of witnesses and weighing the evidence are the responsibilities of the PTAB, not the reviewing court. See Kraft Foods, 2013 IL App (2d) 121031, ¶ 51. When examining the PTAB’s factual findings on administrative review, therefore, the reviewing court will not reweigh the evidence presented in the PTAB hearing, reassess the credibility of the witnesses, make an independent determination of the facts, or substitute its judgment for that of the PTAB. See Marconi, 225 Ill. 2d at 534; Moroney, 2013 IL App (1st) 120493, ¶ 35; Kraft Foods, 2013 IL App (2d) 121031, Nor will the appellate court intervene when there is simply a difference of opinion as to the actual value of the property. Kraft Foods, 2013 IL App (2d) 121031, ¶ 51.

B. Whether the PTAB’s Ruling Was Against the Manifest Weight of the Evidence

Turning to the merits of the parties’ arguments on appeal, we note that under Illinois law, as a general rule, real property is assessed for property tax purposes based upon its fair market value (also referred to more simply as market value)—the price the property would bring in a fair and voluntary sale. See 35 ILCS 200/1-50, 9-145 (West 2012); 86 Ill. Adm. Code 1910.5(b)(5) (2014); Kraft Foods, 2013 IL App (2d) 121031, ¶ 43. Farm improvements, however, such as the building in the present case, are an exception to that general rule and are assessed based upon their contributory value to the farm rather than based upon their market value. See 35 ILCS 200/10-140 (West 2012); O’Connor v. A&P Enterprises, 81 Ill. 2d 260, 267, 275 (1980). Specifically, section 10-140 of the Property Tax Code provides that improvements on farm property, other than a dwelling, “shall have an equalized assessed value of 331⁄3% of their value, based upon the current use of those buildings and the contribution to the productivity of the farm.” 35 ILCS 200/10-140 (West 2012). Section 10-140 thus reflects the legislature’s recognition that certain farm structures may have become obsolete due to changes in farming methods or practices and may have a greatly diminished value, or no value, in connection with the farming operation. See O’Connor, 81 Ill. 2d at 267 (discussing a prior version of the statute).

Although there are different methods for estimating the value of real property, the Department of Revenue, which is responsible for issuing guidelines and recommendations for valuing farmland, has clarified that the contributory value of a farm building (or other farm improvement) should be determined using the cost approach or cost method of valuation. Publication 122, supra at 37. Under the cost approach, contributory value is calculated by first estimating the reproduction or replacement cost new of the building in question and then subtracting depreciation from the replacement cost amount. See id. at 38. There are three types of depreciation that must be considered when using the cost approach: physical deterioration (a loss in the physical ability of a building to withstand normal use due to wear and tear, structural defects, and/or decay), functional obsolescence (a loss in value due to the characteristics of the building—such as poor design, surplus capacity, and/or changes in farming techniques—that cause a failure of the building to serve its intended purpose), and economic obsolescence (a loss in value due to changes in the economic environment of the farm, which results from external influences, such as land-use changes, government regulations, and/or farm market conditions). Id. at 37.

In a hearing before the PTAB, the PTAB’s role is to determine the correct assessed value of the property based upon the facts, evidence, exhibits, and briefs that have been submitted to the PTAB. 86 Ill. Adm. Code 1910.10(b) (1997); 1411 North State Condominium Ass’n v. Illinois Property Tax Appeal Board, 2016 IL App (1st) 143757, ¶ 6 (1411 North State). A taxpayer who appeals an assessment to the PTAB has the initial burden of going forward—the burden of production—and must present substantive documentary evidence or legal argument that is sufficient to challenge the correctness of the assessment. See 86 Ill. Adm. Code 1910.63(a), (b) (2000); 1411 North State, 2016 IL App (1st) 143757, ¶ 8; Peacock v. Property Tax Appeal Board, 339 Ill. App. 3d 1060, 1068 (2003). If the taxpayer satisfies that burden, the burden of production shifts to the county board of review to present substantive documentary evidence or legal argument to support the assessed value that the board of review assigned to the property (or an alternative value). See 86 Ill. Adm. Code 1910.63(c) (2000); 1411 North State, 2016 IL App (1st) 143757, ¶ 8; Peacock, 339 Ill. App. 3d at 1068. Although the burden of production may shift between the taxpayer and the board of review, the ultimate burden of persuasion throughout the proceedings remains on the taxpayer to prove by a preponderance of the evidence that the assessed value assigned to the property is excessive. See 86 Ill. Adm. Code 1910.63(e) (2000); 1411 North State, 2016 IL App (1st) 143757, ¶ 9; Peacock, 339 Ill. App. 3d at 1071.

In the present case, the PTAB ultimately found following an evidentiary hearing that the Trust had failed in its burden of proof to show by a preponderance of the evidence that the farm building had been given too high of an assessed value for the 2012 tax year. After having reviewed the record of the PTAB proceedings, we conclude that the PTAB’s finding on the Trust’s failure to satisfy its burden of proof was not against the manifest weight of the evidence. See Marconi, 225 Ill. 2d at 532-34; Moroney, 2013 IL App (1st) 120493, ¶ 36. At the heart of the PTAB’s decision was its determination that the appraisal submitted by the Trust in support of its position (Blean’s appraisal) was flawed and that it was entitled to little weight. That credibility determination was in the PTAB’s province to make (see Kraft Foods, 2013 IL App (2d) 121031, ¶ 51 (recognizing that determining the credibility of witnesses and weighing the evidence are the responsibilities of the PTAB, not the reviewing court)) and was well supported by the evidence. Most notably, Blean’s written appraisal report and his testimony before the PTAB established that Blean had relied on only one comparable sale in determining the amount of functional and external obsolescence to apply to the Trust’s farm building and that the comparable sale that Blean had used was invalid for comparison purposes because it did not involve an arm’s-length transaction. The PTAB also noted and documented in its written order other flaws that it had found in Blean’s appraisal/opinion as to the contributory value of the farm building, including, among other things, that Blean had used an overinflated value for the farmland of the comparable property, which resulted in a higher level of depreciation being attributed to the comparable farm building and to the Trust’s farm building by extrapolation; that Blean had failed to set forth in his appraisal his calculations for determining the replacement cost of the comparable farm building; and that Blean had failed to specify in his appraisal why he allocated the depreciation percentages in the manner that he did for the comparable farm building.

By contrast, the PTAB found that the Board’s appraisal (Webb’s appraisal) was the best evidence of the contributory value of the farm building, noting that the cost approach developed by Webb was more detailed than Blean’s and better reflected all of the individual components that made up the subject property. Although the Trust attacks that finding here, claiming that Webb failed to consider obsolescence, the record does not support that claim. To the contrary, the record shows that Webb considered obsolescence and that she determined that it did not apply in this case. Webb explained the reasons for her decision in that regard in both her written appraisal report and her testimony. Therefore, based upon the PTAB’s factual findings as to the credibility/weight to be given to each of the two appraisals—findings that were not against the manifest weight of the evidence—we must conclude that the PTAB correctly determined that the Trust failed to satisfy its burden of proof to show that a reduction in the assessment was warranted. See 86 Ill. Adm. Code 1910.63(e) (2000); 1411 North State, 2016 IL App (1st) 143757, ¶ 9; Peacock, 339 Ill. App. 3d at 1071.

C. The Trust’s Statutory Interpretation Argument
Having concluded that the PTAB’s ruling was not against the manifest weight of the evidence and must be affirmed, we find is unnecessary to rule upon the merits of the Trust’s statutory interpretation argument. As defendants correctly point out in this appeal, even if the Trust’s statutory interpretation argument was correct and Webb’s appraisal was flawed, we would still have to uphold the PTAB’s determination because the Trust failed to present any credible evidence to establish that the Trust’s farm building had been over-assessed. See 86 Ill. Adm. Code 1910.63(e) (2000) (indicating that the taxpayer/contesting party has the burden to prove by a preponderance of the evidence that the property has been over-assessed); 1411 North State, 2016 IL App (1st) 143757, ¶ 9 (same); Peacock, 339 Ill. App. 3d at 1071 (same). As we indicated above, the PTAB’s specific factual finding—that Blean’s appraisal was flawed and was entitled to little weight—was not against the manifest weight of the evidence and must be upheld here. See Marconi, 225 Ill. 2d at 534; Moroney, 2013 IL App (1st) 120493, ¶ 36.

D. The Trust’s Constitutional Claim
Finally, with regard to the Trust’s claim that the assessment method used in this case

constituted a violation of the Trust’s equal protection rights, we believe that the Trust’s claim in that regard has been forfeited since the Trust did not assert that claim when the matter was before the PTAB. See Board of Education, Joliet Township High School District No. 204 v. Board of Education, Lincoln Way Community High School District No. 210, 231 Ill. 2d 184, 205 (2008) (stating that any issue not raised before the administrative agency, even constitutional issues that the agency lacks authority to decide, will be forfeited). Furthermore, because our decision in this appeal turns upon the PTAB’s factual findings and the applicable standard of review, we do not agree with the Trust’s assertion that the Trust’s forfeiture should be ignored in this case to maintain a sound body of precedent.

III. CONCLUSION
For the foregoing reasons, we affirm the judgment of the PTAB.

Affirmed.

Edward Sims Jr. Trust v. Henry County Board of Review, 2020 IL App (3d) 190397

Appeal from the Circuit Court of Henry County, No. 18-MR-158; the Hon. Jeffrey W. O’Connor, Judge, presiding.

Jerry J. Pepping and Jennifer L. Kincaid, of Pepping, Balk, Kincaid & Olson, Ltd., of Silvis, for appellant.

Matthew Schutte, State’s Attorney, of Cambridge (Stephanie Barrick, Assistant State’s Attorney, of counsel), for appellees Henry County Board of Review and Tamra S. Dynes.

Kwame Raoul, Attorney General, of Chicago (Jane Elinor Notz, Solicitor General, and Carson R. Griffis, Assistant Attorney General, of counsel), for other appellee.

Election Results

The proposal to amend the Illinois constitution,  in effect ending a flat state income tax, has been defeated. 

The race for Cook County Board of Review (1st District) is inconclusive with many mail-in ballots to be counted. 

Indiana drops corporate tax rate as Illinois considers increasing it

JULY 17, 2020

Illinois Gov. J.B. Pritzker’s ‘fair tax’ would raise Illinois business taxes to the highest in the nation as neighboring Indiana cuts taxes to draw businesses across the border.

Other Midwest states are working to be more business friendly, but Illinois is trying to tax businesses more.

On July 1, Indiana reduced the corporate tax rate from 5.5% to 5.25%. It has been dropping every July since 2012, when it was at 8.5%. Next year, the corporate tax rate will decrease again to 4.9%.

Illinois’ corporate tax rate currently is 9.5%, but will increase to 10.49% if state voters are persuaded by the $56.5 millionworth of “fair tax” messages for which Gov. J.B. Pritzker is paying. Voting to remove Illinois’ flat tax protections will give Illinois a corporate tax rate that is the highest in the nation and more than twice as high as neighboring Indiana.

Pritzker's progressive tax could give Illinois highest corporate income tax rate in U.S.

Small businesses would fare even worse. Tax rates on more than 100,000 Illinois small businesses could jump as much as 47%, from 6.45% to 9.49% – also nearly twice as high as Indiana’s corporate income tax. That is bad for Illinois jobs, because small businesses are responsible for about 60% of the state’s job creation and have already taken the brunt of the COVID-19 economic harm.

Imposing progressive taxes would drop Illinois from 36th to 48th in the nation for its business tax climate, a Tax Foundation analysis found in 2019.

Thousands of Illinois small businesses are not expected to recover from the COVID-19 restrictions and economic downturn. Even big business is suffering, with Chicago-based United Airlines expected to lay off nearly half of its employees. By adding on a massive tax increase, more businesses will close or cut workers.

Many will simply pack up for a state that encourages their growth rather than punishes it.

“My personal opinion is that the governor is making the wrong judgment because you’re going to do a progressive tax and start pushing people out of Illinois,” said Antonio Cavazos, who owns a sangria manufacturing business with his wife in Oak Lawn. “We’ve considered [moving]. And looking at excise tax, Indiana and Wisconsin are a heck of a lot cheaper than Illinois.”

Illinoisans will vote on Pritzker’s progressive income tax measure Nov. 3.

Chicago Tribune Editorial: Property tax failure another reason to vote against the tax referendum

July is sweat-and-fret month for many taxpayers in Illinois: How will households slammed by job disruptions and a public health contagion now pay their property tax bills? Those local taxes gouge virtually everyone: Employers and homeowners — or whoever services their mortgages — make most of these payments to the county treasurer; renters indirectly pay property taxes in rent to the landlord.

And after the pending property tax deadline, another threat looms. Voters this fall will decide whether to let their politicians raise state income taxes or instead force them to clamp down on state spending that just grows and grows.

What we call the proposed “Pritzker Tax” — named for Gov. J.B. Pritzker, who calls it a “fair tax” — would replace Illinois’ constitutionally protected flat-rate income tax with graduated rates. The change would make it easier for politicians in Springfield to raise income taxes. Currently, a tax hike requires more heft from politicians because it affects every taxpayer. Tinkering with a graduated structure is a softer lift.

Oh! We’re just raising this itty-bitty rate on this itty-bitty group of people. Those itty-bitties add up.

As a voter, you’re supposed to trust Illinois politicians. Trust that they’ll give you property tax relief. Trust that they’ll start passing smarter budgets. Trust that they’ll undo some of their past mistakes. Oh, and trust that they’ll only slap this top itty-bitty 3% of taxpayers with higher tax rates — as if higher earners are to blame for this state’s fiscal mess. You’ll see ads urging you to trust the pols, including the most influential pol, House Speaker Michael Madigan, and vote yes on the Pritzker Tax amendment. Pritzker dumped more than $50 million of his own money into the campaign to get it passed.

Which brings us right back to this latest round of property tax bills. The refusal of Democratic lawmakers to confront Illinois’ runaway property taxes speaks volumes about whether you should trust Springfield’s promises about the Pritzker Tax.

‘Trust us, we’ll fix property taxes.

Recall how, in the spring of 2019, the governor placated some Democratic legislators nervous about putting his Pritzker Tax amendment on the November 2020 ballot. How could they justify voting to enable even higher taxation?

Pritzker tossed them a bone: He’d offset a risky income tax grab with property tax reform. Here’s what the governor said on Aug. 2, 2019, when he announced formation of a legislative task force to help Illinois “reduce local reliance on property taxes”:

“Together, we’ll ensure our children receive the quality education they deserve even while we provide more property tax relief for our homeowners and make our system more fair for everyone.”

We wrote that because of that pledge, Pritzker would have to extract some action on property taxes from his task force and the legislature — even if the General Assembly merely sprayed eyewash that didn’t actually lower property tax bills. We expected, say, a nobly titled Illinois Property Taxpayers Relief Act. Maybe an appearance of reform would persuade voters that Democrats were working feverishly to lower local tax bills.

But nothing happened. The task force flopped. Democratic legislators paid lip service. Worse, falling home values throughout the Chicago area due in part to eye-popping property taxes have created a money-losing cycle that is pushing residents out of Illinois.

Democrats could blame the pandemic for the failure to reform, but that would be dishonest. They had no property tax plan before the contagion hit, and they developed no fix during their five session months.

Besides, Illinois property taxes have been studied interminably. Reform is a question of willingness, not of finding time. Madigan’s command staff could have fixed the property tax system decades ago — if that’s what Madigan wanted.

‘Trust us, we need more income tax’

The promise of property tax reform has always smacked of a shell game. Trim one tax while increasing another. The truth is that if state government, local governments and school districts don’t rein in their spending, taxpayers will get no net relief. Taxpayers will pay the same total amount of their income in taxes — less here but more there.

Yet cutting the cost of government isn’t part of the Pritzker Tax agenda. The Democrats offer no pension reform, no big cuts to other cost drivers, not even state furlough days or other economizing on personnel costs during the pandemic.

Instead opportunistic Democrats have adopted the pandemic as, yes, one more excuse for raising more income tax revenue. Look at all the money we have to spend on the coronavirus!

This stubborn refusal to aggressively enlist Illinois’ public sector in a statewide sacrifice attests to the clout of the public employee unions whose money and muscle keep Democrats in control here.

Pritzker, Madigan & Co. protect spending on union workers in state but also local governments. Given the pension crisis Illinois politicians have nurtured, that protection racket has exorbitant costs to taxpayers. The need to meet enormous and rising personnel costs is the real if unspoken rationale for the Pritzker Tax.

‘Trust us, we’ll fix Illinois’

That’s also why the promise of property tax reform relied on taxpayers’ gullibility. Maybe Pritzker himself was gullible in thinking he could make it happen.

But Madigan routinely passes the annual budget he wants. The governors are short-timers. The come and go. By contrast, 2020 is Madigan’s 50th year in Springfield.

So even if Joe Taxpayer wants to believe and trust in Pritzker, not even halfway through his first term, that taxpayer must contend with the levers that actually decide on spending in Springfield. That’s Madigan.

We’ll have more to say about these and many other broken promises to taxpayers — Illinois politicians’ fractured fairy tales — as the tax vote approaches.

So, do you trust Michael Madigan?

Whether because of his inexperience at government or just his generally affable manner, the governor may have already undercut his own push for the Pritzker Tax. He won support for graduated tax rates by voicing a promise of property tax reform. Didn’t happen.

In his first year, he signed a budget that increased spending both on the general revenue side and through a massive $45 billion infrastructure bill. There were no spending cuts, no efficiencies, no “shared sacrifice” from unionized employees. Only higher taxes and fees.

When the COVID pandemic hit, Illinois was, of course, ill-equipped to handle any sort of emergency. That led to Senate President Don Harmon’s infamous “ask” of Congress for a bailout that included pension help.

Is this the fiscally prudent, trustworthy state government deserving of more money through an income tax hike? Rhetorical question.

Voters should focus on this: The Democrats who run Illinois haven’t done the hard work of restructuring how this state collects, and spends, all the money it already gets from taxpayers.

And they won’t do that hard work unless voters reject the Pritzker Tax. It is one chance for voters to hold the upper hand. Remember that as you pay your property taxes. Another promise, broken.

Editorials reflect the opinion of the Chicago Tribune Editorial Board.

Late Property Tax Payments

Late tax bill payment status for the the following Illinois counties:

Cook: The County Board is going to consider a proposal to permit certain tax bill payments  to be delayed up to 60 days.

DuPage: The county will allow certain tax bills to be paid late if a “hardship waiver” is obtained.

Lake: The county will allow certain tax bills to be paid late according to rules to be developed by the Treasuer.

Cook County Circuit Court Closure Extended

Cook County Circuit Court is extending its suspension of most criminal and civil cases through May and expanding the use of videoconferencing amid the growing COVID-19 outbreak.

Originally postponed until April 15, most court cases are now suspended until May 18, the office of Chief Judge Timothy Evans said in a statement Monday.

Illinois PTAB Changes

The Property Tax Appeal Board (PTAB) has received inquiries regarding the continuing operations of the PTAB during the COVID-19 pandemic. The PTAB is also aware that many offices are working remotely and are unable to perform normal operations. In light of the COVID-19 pandemic, the PTAB will be operating as follows until further notice.

Other than hearing postponements, the PTAB will not be generating or sending out mail or electronic correspondence during this time, thereby not creating any new filing deadlines. If you have cases that have current deadlines, you may send extension requests electronically to the PTA.Clerk@Illinois.gov email address. Please do not send evidence to this email address; we do not have the staff to process everything electronically.

To help alleviate any approaching deadlines, the PTAB will be granting a 60-day extension to any deadlines that occur from March 23, 2020 through April 30, 2020, system wide. The extensions will run from the original due date for 60 additional days. The PTAB will not be sending letters for these extensions, however, the parties will be able to see the extensions granted on the Appeal Status Inquiry (ASI) system once the original deadline expires.

Please note that the 30-day period to file an appeal to the PTAB from a BOR decision or PTAB decision has not been extended. You must, at minimum, send in the completed first page of the appeal form with the BOR or PTAB decision and have it postmarked within 30 days of the written decision of the BOR or the PTAB. In Cook County you may also file the appeal within 30 days after the date that the BOR transmits to the county assessor pursuant to Section 16-125 its final action on the township in which the property is located. You may ask for an extension at that time.

The PTAB is also requiring any Request to Intervene that is currently pending be filed within the 60-day time frame of the notice from the BOR to the taxing district of the appeal. Please note that pursuant to Section 1910.60(e)(1) of the PTAB’s rules (86 Ill.Admin.Code 1910.60(e)(1)) if the Request to Intervene is filed without the resolution of the taxing body authorizing intervention, provide a written explanation of the reason and a request for an extension to file the resolution, which will be liberally construed by the PTAB until further notice. You may also ask for an extension of time to file evidence at that time.

Currently the PTAB is scheduled to have a meeting on April 14, 2020, at which time it may issue decisions. Furthermore, the PTAB intends to cancel hearings scheduled through April 17, 2020.

The PTAB continues to work remotely but can answer any questions you may have by calling us at 217/782-6076 or by sending an email to the Clerk of the PTAB at the PTA.Clerk@Illinois.gov email address.

Thank you for your patience and cooperation.

Clerk of the Board
Illinois Property Tax Appeal Board
402 Stratton Building
Springfield, IL 62706
(217) 782-6076 (Office)
(217) 785-4425 (Fax)
www.ptab.illinois.gov

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