Tag Archives: property taxes

Few voters weighing in on suburban Cook County property tax questions

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When given a choice at the ballot, few residents of Cook County suburbs decided to vote for or against in recent years:

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Despite Cook County residents’ long, loud complaints about out-of-control property taxes and government spending, a majority of them couldn’t be bothered to turn out to vote in recent elections when given the chance to decide whether taxes should be hiked.

About 1 in 5 eligible voters decided the outcome of costly binding property tax questions in various suburbs in the past couple of years, according to a new study from the Cook County treasurer’s office…

Voter turnout in primaries is typically lower than general elections as it is, and even fewer voters participate in local consolidated elections.

But the report also found participation dipped on ballots for property tax questions in particular. It floated a few reasons why people who do vote might skip referendums: the questions are often at the bottom of the ballot or confusingly written…

Previous reports from her office have highlighted higher turnouts in wealthier and whiter areas. While the income trends continued in the 2025 and 2026 elections, there was not enough data to see whether the racial trends shifted because most of the referendums were in majority white communities.

Property taxes are high in Illinois. Even amid generally low voter turnout in local matters, this seems like an issue people might care about. Want to vote on how your property taxes might be used? This is connected to local control and local government, a feature Americans like about suburbs.

It sounds like the factors cited above could be addressed. Don’t bury them at the bottom of the ballot. Make sure they are written in clear language. Help people know what is on the ballot far ahead of time. Put the tax questions on the bigger election cycles. For those who want to promote good governance (rather than even the appearance of sneaking things through on the ballot), this is doable.

I wonder if there would be any traction for elected officials to run on the platform of getting more people involved in local political decisions. Rather than targeting a small portion of voters or a political base, could someone aim to get more people to decide questions like these about property taxes?

Communities preparing for possible property tax reductions in Florida

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With the possibility that Florida residents will soon vote to significantly lower property taxes, communities in the states are trying to get ready:

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The proposal is spurring urgent responses from local governments faced with the prospect of plummeting tax revenue. Cities and counties are scrambling to prepare for a potential overhaul of how they pay for all sorts of services, from policing to pothole repairs.

Local officials across the state say the issue is dominating discussion in commission meetings and budget workshops. Among the measures they have taken so far: freezing hiring and capital projects, planning possible service cuts and floating proposals to increase other fees and taxes to offset the shortfall…

In the 2027-28 fiscal year, the Florida changes would reduce property-tax revenue in the state overall by nearly $5 billion, according to the Office of Economic and Demographic Research, a research arm of the legislature. That would increase to $8.8 billion in 2028-29 and $10.8 billion in 2030-31.

The amounts would vary widely for individual counties, with a large one like Miami-Dade projected to lose $304 million in the first year and a small one like Okeechobee expected to lose $3.7 million, according to an analysis by the Florida Association of Counties. Suburban counties with high proportions of homestead properties would face the sharpest exposure, and economically distressed small counties would be the least equipped to respond, the study said.

Americans generally do not like the idea of high property taxes. They like the idea of homeownership but do not always like the idea they should pay more taxes on something they own.

At the same time, this tax helps fund many of the local amenities and services Americans benefit from and participate in. When looking at amenities about communities when making choices about where to live or when discussing local features and amenities they like, property taxes likely contribute. This includes schools, parks, and police and fire departments.

The tradeoffs I wonder if Americans are willing to make: either or both (1) lower levels of local amenities and services and (2) less local control over local services and amenities for lower property taxes. Immediate financial benefits for property owners but a loss of quality of life? How this plays out in Florida might help

Funding local services via property taxes or state funds

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What should be the formula by which local governments and the state of Illinois contribute monies for local services? There might be change coming:

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The concern centers on the Local Government Distributive Fund, the long-standing revenue-sharing mechanism that sends a portion of state income tax collections to cities and towns across Illinois.

Illinois mayors are warning that Pritzker’s proposed fiscal year 2027 budget plan reduces the share of state income-tax revenue distributed to local governments, a shift that would force many municipalities to make tough choices.

The proposal would lower the municipal share of income tax revenue distributed through the fund from 6.47% to 6.23%, meaning cities and villages would receive about $60 million less than they would under the current formula. Lawmakers have reduced that share significantly over the years, starting with a substantial cut from the 10% level that persisted prior to 2011 when lawmakers significantly increased the income tax.

While the change would send more money to the state, it would squeeze local governments that rely heavily on property taxes to fund services. Pulling additional dollars from the LGDF risks shifting the burden onto Illinois homeowners, who already face some of the highest property tax bills in the country. Property taxes are set locally, but state decisions about revenue sharing inevitably shape how much local governments must rely on them. 

Several matters appear to be at play:

  1. Local residents and leaders tend to like more local oversight of government and funds. But they are not necessarily opposed to getting funds from elsewhere – like the state – to then spend locally.
  2. Who should be making “tough choices”? Let’s say the formula is reconfigured; what local services are at risk for Illinois communities? Or where is that extra money the state is keeping then being spent? Would that money be spent in ways that helps lot of people?
  3. Property taxes are a hot button issue in many places. People like their property values going up but they do not like their property taxes going up along with that. And property taxes pay for the local services that help support their property values (schools, local amenities, etc.). If people don’t want property taxes to keep going up, what would local communities actually cut or scale back?

Percentage-wise, the formula change seems small but this gets at a fundamental issue in the American political and social system: there are multiple layers of government that provide for residents. Americans tend to like local control but townships, counties, states, and the federal government also provide services. The optimal distribution of funding and services is up for negotiation and the debate grows stronger when there is less money to go around.

Which American communities will give up local services in order to not have any property taxes?

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As multiple states consider having no property taxes, what happens to the local services that property taxes fund? This could include local schools and local services. Many communities value their local services, whether the residents themselves make use of them and/or because they help contribute to local property values.

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So if there is less funding for local services (this assumes county or state funds might not make up the loss of property tax revenues), which ones would people be willing to forgo? Some possibilities:

-Local schools. Lots of complaints about how much schools cost, particularly labor costs. And people who do not have kids in the schools might want to pay less for schools. (Counterargument: the quality of schools helps boost the status of communities and is related to property values.)

-Local police/fire. Do we need this much local coverage?

-The number of local government employees/functions. Are they all needed?

-Thinking about these last two: why not consolidate police or roads or other local services with other communities or within an entire county? (Counterargument: individual communities then have less say over how much the local services interact with their residents.)

I suspect that places that eliminate property taxes may then have some interesting discussions about how to make sure the services that property taxes helped fund continue. How many residents will actually accept a decrease in local services and amenities?

Education the biggest recipient of local property and IL state taxes

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I recently received the breakdowns of where tax dollars for the State of Illinois and DuPage County went in 2024:

In both cases, education leads the way. For state expenditures, education accounts for 24.8% of spending. At the local level, education accounts for 69.4% of the total rate.

The large portions going to education are supported by multiple interests of residents:

  1. Education is often pitched as for children, the next generation, and the future. If we do not spend on education today, how will the children succeed and/or do better than the previous generation?
  2. The quality of local schools is often tied to housing prices and the status of communities. To not spend locally on schools might provide short-term savings but reduce the desirability of properties and communities in the long-term.
  3. The bulk of education costs is in salaries for teachers and staff. Without quality educators, how can schools be successful?

Some might complain about the tax burden – and Illinois does have high property taxes – but it is hard to argue against spending on education. It could be more effective to reign in spending by targeting other areas where there is duplication of local services (such as townships).

Amid rising housing values, Americans “revolting” against property taxes

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Florida and at least a few other states are considering limiting or eliminating property taxes:

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Florida’s leaders are considering a far-reaching remedy to cut the soaring costs of owning a home: ditching property taxes…

“People are getting crushed not just by home insurance but by property taxes,” said GOP state Sen. Jonathan Martin, who is sponsoring a bill that would require a study on the elimination of property taxes be completed by October. “That American dream in Florida is taking five figures a year in local taxes.”

Revolts against property taxes have erupted elsewhere in recent months as homeowners’ tax bills have risen alongside home values. Property values in the U.S. increased 27%, adjusted for inflation, between January 2020 and July 2024, according to the Tax Foundation, a think tank.

“You’re seeing a groundswell of opposition to property taxes generally”—one reminiscent of a wave of protest in the 1970s and 1980s that triggered ballot measures including Proposition 13 in California that capped property taxes, said Jared Walczak, vice president of state projects at the Tax Foundation.

A number of states including Wyoming, Kansas and Montana are weighing significant property-tax limitations, he said. In November, voters in North Dakota rejected a ballot measure that would have eliminated property taxes.

This is the double-edged sword of property taxes in the United States: homeowners like their property values going up but they do not like it when their property taxes adjust to that increased value. In the short-term people do not want to pay more in taxes even as in the long-term they will benefit from selling at a higher price.

So what other taxes might people be willing to pay if property taxes are reduced or done away with? There would be other ways to generate revenue that would not be tied to property values. More taxes on driving? Higher sales taxes? Increased tax rates on business activity?

It would also be interesting to see how local governments would adjust to the change in funding. Would other tax formulas equal the same amounts that come now through property taxes? Who would make up the shortfalls in funding?

Office buildings empty, residential property taxes go up

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What happens when the office buildings in Chicago’s Loop have more vacancies? Residents end up paying more in property taxes:

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The pandemic left the heart of the Loop with vacant offices and stores as workers and customers stayed home, and more people began working remotely. Then, citing the impact of that lost business, the owners of those vacant offices won huge tax breaks from Cook County officials.

The amount of property taxes didn’t get smaller because those taxpayers were now paying less. The taxes were still needed to pay for government services and salaries. So others have had to pay more to make up for that shortfall.

On top of that shift, City Hall and other government agencies have been asking property owners to pay more taxes overall, with total property taxes in Chicago rising from $6.8 billion five years ago to $8.3 billion last year.

That’s a 22% increase in taxes citywide in those five years.

This is one reason municipal officials like thriving commercial and industrial sectors: they contribute to the property tax base of a community. When these properties are worth less, someone else has to pick up the slack. Homeowners do not like rapidly increasing property taxes, if they like property taxes at all.

For residential property owners, the issue is compounded for some because the value of residences has jumped in recent years. With limited new supply and consistent demand for good housing, property values have gone up. Homeowners like this – until property taxes also increase because their home values have increased.

Will residential property owners put up with this and, even if they do not like it, what recourse do they have? Does this mean cities and communities need to put on a full-court press to get office buildings filled or converted?

Would Americans choose lower property taxes if it means giving up local control of funding for local services?

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This is an interesting “Would you rather?” for numerous American communities: would residents rather have higher property taxes or give up control of the local funding for schools and other local services because of lower property taxes?

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There is a silver lining, though. The most radical property tax–related proposals are argued for as either general anti-tax measures or as efforts to privatize schooling. Whatever you think of their intended goals, they would also have an unintended effect of ameliorating one of the worst features of the property tax: its localism.

If North Dakota voters had voted for a repeal of the property tax, much of the revenue used to replace it likely would have come from state taxes. (The group formed to oppose it was called “Keep it Local.”) Similarly, if the state government is supporting school choice vouchers with income or sales tax revenue, that means schools as a whole rely less on local property taxes.

Americans like local control, particularly in the suburbs. To give that up to governments elsewhere who may attach particular guidelines to the funding could be seen as a loss.

And there are some people willing to argue they are willing to pay higher property taxes for what they receive. It is less clear how many residents feel this way or that people do not find ways to limit their property taxes.

I am not sure this has to be pitched as an either/or: higher property taxes or lower taxes and give up financial control to other bodies. Here are two other options:

  1. Do Americans believe that local services can and should be provided more cheaply? This could be about containing costs of existing services.
  2. Another variation for #1 is cutting local services to limit costs.

Both of these options might be unattractive: local services tend to help enhance the status and value of properties and communities. Reducing these or threatening them could be perceived as backfiring and hurting everyone.

The choice might also depend on the local context. Would high housing values in some places lead to residents wanting to do a lot to limit property taxes? Or what if residents felt they could handle funding coming from other places? After all, real estate is local.

Bureaucracy misses property tax assessments, property owners can pay up to 3 years later

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A report on errors in property assessments by the Cook County assessor’s office includes this summary of Illinois legislation:

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State law allows county assessors to back-tax property owners for up to three years of missed assessments, even when the homeowners did nothing wrong.

This can have serious consequences:

A homeowner in Northbrook was hit with a nearly $7,800 bill in back taxes this year after the home, built by 2022, was added to the rolls in 2023. The assessor’s office had the permit data on file, records show.

That homeowner’s next door neighbor was hit even harder…

Finished in 2020, it sold for nearly $1.4 million the same year. The owners paid less than $1,800 in property taxes last year because the assessor’s office listed it as vacant land for three years before realizing their error.

Their bill this year: more than $93,000. The sum includes more than $67,000 in back taxes.

In an even more extreme case, Kaegi’s office classified an $11 million lakefront house in Winnetka as vacant until 2022, even though its construction was completed in 2020. This year, its owner owes $651,346 in property taxes, including more than $370,000 in back taxes from 2020 and 2021 — more than 4% of all property taxes being collected by the village of Winnetka this year.

The bulk of the story is about the difficulty the assessor’s office has had in keeping up with current property values. From it not being the top priority to not being able to keep up with all the data they have to not getting the data in the first place, it sounds like there are multiple areas to improve in.

So I wonder about the consequences of this passed along to property owners. They might have choices in local elections about who is in this position. They tend to assume the local government is doing their job. Yet I would guess this position is not the radar screen of most people. They might not be very aware of how to appeal their taxes or how their taxes are calculated. They get their taxes each year and pay the bill.

There is even a story in the article about a property owner who realized their taxes were probably low and tried to ask about it. Nothing happened.

If property taxes are important to local government – and I know they are – then it would behoove them to be on top of assessing properties, collecting taxes, and working with the public.

When housing values and property taxes both go up

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American homeowners want their property values to increase. It builds their wealth. The equity they have in the home can be used for other purposes. They can feel like they made a good investment.

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On the other hand, fewer homeowners like the idea of paying higher property taxes. Particularly in states with higher property taxes, like Illinois, this is a constant source of frustration: don’t we pay too much? How come other states get away with much lower property taxes?

But, these two forces might just be linked. If your property is worth more, the taxes you pay on that property are likely to go up. In other words, the kind of property appreciation many homeowners want means higher taxes on that more valuable property. (This is not always the case: the value may go up but the property tax rate goes down or some program or exemption limits the property tax amount.)

In a dream world for homeowners, their property would get more valuable and they pay less in taxes. It does not often work this way so instead they may complain about having to pay more in the short term for the ability to gain more money down the road when they sell the property.