Illinois House approves property tax freeze during declining property assessments
The Chicago Sun Times reported today that the Illinois House passed SB2073 and sent the measure back to the Senate for concurrence with amendments added by Jack Franks (D-Marengo). The bill, which was approved 74-39, freezes property taxes during years of declining assessments.
The amendments to the Senate bill include the language of Franks’ HB 3793 and his recently introduced HB4608, covered in two previous posts, which prohibit taxing bodies from increasing their taxes in any year when the assessed value of property within their boundaries dropped from the previous year – unless voters approve.
Chuck Jefferson and Joe Sosnowski voted to approve SB2073, which provides some hope to frustrated taxpayers around the state, whose taxes keep going up under the Property Tax Extension Limitation Law (PTELL) or (Tax Cap) legislation, while home values are declining.
Two of our local representatives, Jim Sacia and Dave Winters, continued to vote against this legislation, as they did with HB3793.
Opponents of Franks’ bill said it would hamstring already cash-strapped municipalities, potentially leaving them unable to provide basic services to residents.
“This could be dangerous for communities,” said Rep. Roger Eddy (R-Hutsonville), who voted against the legislation.
These legislators are simply wrong! First, the bill only removes the inflation component of the PTELL law. Inflation has averaged 2.5% for the last 10 years. That’s not going to be “dangerous” for any taxing body and certainly will not leave them unable to provide basic services.
SB2073 doesn’t stop the taxing districts from going to the voters with a referendum, if they can justify a tax increase – that’s in the bill. However, the taxing bodies would prefer to raise taxes through an unintended backdoor referendum provision in PTELL, rather then justify their reasons for further tax increases to the voters.
The real reason taxing groups and their supporters want to maximize the property taxes is they do not want to lower the tax base for future year’s PTELL tax calculations.
During the current economic conditions, with declining home values, taxing districts will just have to make do with the amount of taxes they collected the previous year. When the economy starts to improve, and home values start to increase, SB2073 would no longer apply unless there is a future downturn in home values.
Taxing bodies’ possess the mindset that they are “entitled” to tax our earnings to the maximum allowed by law, not what is actually required to provide services. PTELL was originally passed to limit these municipalities from grabbing everything they could during the booming housing market in the 1990’s.
When these taxing entities realized, that with decreasing property values, they could take even more from taxpayers, due to an unintended consequence of the PTELL law, they levied the maximum taxes allowed for the last three years!
The public employee lobbyists will come out in force trying to stop this legislation in the Senate, since the bill was fast-tracked through the House and the lobbyists didn’t have time to rally their troops against it, as they did against HB3793 last November.
Illinois taxpayers should worry that their ‘local legislators’ seem more concerned with the taxing bodies, than their property tax paying constituents!